Big debts and custody fight: why MLB took Dodgers

[April 22, 2011]  NEW YORK (AP) -- As he read each report coming from Los Angeles, baseball Commissioner Bud Selig grew more and more concerned.

Dodgers owner Frank McCourt and his wife, Jamie -- the team's former chief executive officer -- were trading bitter accusations during a three-week divorce trial that centered on which of them owned the franchise of Jackie Robinson, Sandy Koufax and Tommy Lasorda.

Then Frank McCourt fired Dennis Mannion, the team president. Having already burdened the team and its real estate with more than $450 million of debt, McCourt wanted to take out additional loans and was having trouble securing them. He retained a high-powered law firm and wanted to negotiate a new front-loaded television deal that would give the club more cash he might withdraw for himself.

Then on opening day, a San Francisco Giants fan was severely beaten outside Dodger Stadium, highlighting a security problem fans have complained about for years. The fan remains in a medically induced coma. And there were worries the Dodgers would not make their first player payroll on April 15.

Finally, Selig had enough. He took the extraordinary step Wednesday of saying Major League Baseball was taking over operations of one of America's most famous teams, the one that integrated the national pastime, broke Brooklyn's heart and paved the way for coast-to-coast expansion. The takeover is possibly a prelude to Selig forcing a sale of the franchise.

"It wasn't one thing," a high-ranking baseball executive said Thursday, speaking on condition of anonymity because only Selig was authorized to speak on the situation. "It was a series of things that just kept building."

Once a model, the Dodgers now are just a mess.

The team began play as the Brooklyn Bridegrooms in 1890 (several of the players had gotten married in the leadup to the initial season). The club later became known as the "Trolley Dodgers" -- shortened to "Dodgers" and "Superbas" -- and was affectionately labeled "Dem Bums" as it failed to win the World Series year after year until its first title in 1955.

After the 1957 season, Walter O'Malley moved the Dodgers to Los Angeles, persuading the Giants to go west with him to San Francisco, and his team became a prototype franchise with a sparkling modern ballpark that regularly led baseball in attendance.

But the Dodgers haven't won a World Series since 1988, when they were still owned by the O'Malley family. The Fox division of Rupert Murdoch's News Corp. bought the team in 1998, then sold it to McCourt in 2004.

Speaking Thursday, a day after his announcement, Selig wouldn't go into details about why he decided to take over the team. He is expected to appoint his new head of the Dodgers early next week, the baseball executive said.

Selig did draw a distinction between the problems of the Dodgers and those of the New York Mets, a team that is not only struggling for cash but is mired in the Bernard Madoff investor fraud scandal. While Mets owners Fred Wilpon and Saul Katz are seeking to sell a minority stake in the team, McCourt was becoming more and more leveraged.

"There are a lot of differences between the Mets' and Dodgers' situations," Selig told the Associated Press Sports Editors. "Comparing the Mets to the Dodgers, not only is it not true, it's just not accurate."

Baseball officials were worried that money coming into the Dodgers from a new deal with Fox would be redirected to McCourt personally and would not be used for team operations.

Steve Soboroff, hired Tuesday as the Dodgers' vice chairman, said baseball's concerned were unjustified and Selig's decision was "irresponsible."

McCourt's planned deal "should be the model for other baseball teams. But Frank is being picked out," Soboroff said. "He said, 'We meet these requirements.' Other teams, like in New York, don't. He's being picked out and selected."

Now, Soboroff said, any team expediture over $5,000 must be approved by MLB.

Former Dodgers manager Joe Torre said he talked with Selig about the move, and that he hopes it produces a healthy franchise.

"It's obvious the organization needed to be tended to, paid attention to, and I know it wasn't easy for the commissioner to come up with the decision that he did," Torre said.

League takeovers of troubled teams have occurred in other sports. The NBA purchased the New Orleans Hornets from George Shinn in December. The NHL bought the Phoenix Coyotes in U.S. Bankruptcy Court in November 2009. In addition, the NHL and lenders to Dallas Stars owner Tom Hicks installed former baseball team executive Tony Tavares as the team president in January.

But baseball has never had a situation quite like this. In the case of the Montreal Expos, MLB purchased the team in 2002 from Jeffrey Loria, who in turn bought the Florida Marlins from John Henry, who in turn headed the group that acquired the Boston Red Sox. And last year, Selig dispatched MLB executive vice president John McHale Jr. to Texas in a behind-the-scenes move to assist the sale of the cash-strapped Texas Rangers from Hicks to a group headed by Nolan Ryan.

"It had a great ending," Selig said. "Everybody walked away happy."

Selig has broad power to act under the Major League Constitution, the agreement that binds the 30 teams. Article II states his functions include "to investigate, either upon complaint or upon the commissioner's own initiative, any act, transaction or practice charged, alleged or suspected to be not in the best interests of the national game of baseball."

While his power over players is limited by the union and its labor contract, he has full authority over teams and management employees.

"It is true when people come into baseball, they do sign a document that they will not sue baseball. That's been true forever," Selig said.

Some have tried, including George Steinbrenner of the Yankees and Charlie Finley of the Oakland Athletics.

"Yeah, and they've lost," Selig quickly added.

Team executives have speculated over the next Dodgers head. Among the candidates mentioned were McHale, former Atlanta Braves and Washington Nationals chief executive Stan Kasten, former Giants executive vice president Corey Busch and former San Diego Padres president Dick Freeman.

They will have a mountain of debt to climb out of: $384 million of long-term debt on the team and $73 million on the Chavez Ravine land where Dodger Stadium sits, a lawyer familiar with the Dodgers' financial arrangements said, speaking on condition of anonymity because the team has not announced those figures.

Fans primarily care about one number: wins. They see McCourt's ouster as a positive.

"He's out! Great news!" season-ticket holder Martin McGinty said, giving a thumbs-up.

"I was hoping something like this would happen. Everything they've done has been terrible," he said of the McCourt family. "They didn't spend money on anything."

For those who say they bleed Dodger blue, the descent of the team has been upsetting.

"I'm saddened by the whole issue. And I think I'm in shock about the whole issue," said former pitcher Don Newcombe, now a special adviser to the chairman. "I don't know where I'd be or what I would have been without the Dodgers.

"I was playing in the Negro Leagues in 1946," Newcombe said. "The Dodgers in that era were unique. It was different than any other sports entity. And they became the biggest entity in major league sports, and were responsible for so many things happening. The Dodgers really started the civil rights movement."

[Associated Press; By RONALD BLUM]

Associated Press writers John Rogers and Greg Risling in Los Angeles contributed to this report.

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