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Special to CityWatch: Can Jorge Ramos Save The American Immigrant Dream?

Tony Castro
TONY CASTRO’S LA- President Barack Obama’s disappointing failure to champion immigration reform, what The Washington Post called his “immigration train wreck,” may be the consummate example of the failure of the Obama presidency on Latino issues. It is also a tell-tale sign of the potential trouble the Democratic Party could find itself in…

Museum Row’s Billion Dollar Block Party

Tim Deegan
EXCLUSIVE TO CITYWATCH--City planners, developers, community members and other stakeholders are having a block party in the Miracle Mile: no champagne but plenty of stress served to order, depending on who you're aligned with. Issues with development: take a seat. Raising hundreds of millions of dollars for development, take several seats. Here…

What Is It About The Homeless That Makes Us So Angry?

Bob Gelfand
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Kill the Transit Tax, Kill the Olympics

Ken Alpern
ALPERN AT LARGE-You know, it's indeed possible that there will be enough voters who won't remember (or care about) the current shenanigans and budget games in the City of LA--enough to allow a 2/3 vote to pass a new sales tax measure in November 2016. Then again, maybe enough voters will remember, and the initiative will (like its predecessor…

Headlines Don’t Lie – LA Needs Leadership

Dennis Zine
JUST THE FACTS-I’m talking to you as a man who policed Los Angeles streets for over 30 years and established policy for another 14 years -- two years as an elected Charter Reform Commissioner and 12 years as an elected Los Angeles City Councilman. Take a look at the latest Los Angeles News and Breaking Headlines. They tell a frightening story…

Airbnb Just Floats by the PLUM Committee

Tony Butka
THE CITY-I was going to do my usual flip and cynical kind of a piece on the Airbnb hearing, but the issue is too important, and just maybe, all is not lost. The Planning and Land Use Management (PLUM) Committee hearing was scheduled in the Public Works Hearing Room, but so many people attended that they had to move it to City Council Chambers…

Bikeshare Comes to Los Angeles … Sort Of

Richard Risemberg
WAITING ON LA--Here’s photographic confirmation that bikeshare has arrived in LA: Not the City of Los Angeles, though; not quite yet. That’s a live bikeshare station in Santa Monica, on Main Street, next to one of the two bike corrals that grace the block south of Ashland. (There’s another and very busy bike corral two blocks north.) This is a…

The Summer of My Discontent ... LA Version

Denyse Selesnick
MY TURN--I think there is such a thing as the "Dog Days of Summer" since my usual sunny disposition ... glass half full demeanor ... seems to be out of sorts of late. There is a litany of things that are annoying me, aside from the heat. I am disappointed in our local government ... not all of them, but a majority. Like many of you I studied the…

Marilyn Who? Ask Councilman Krekorian or Mayor Garcetti

Richard Lee Abrams
PRESERVATION POLITICS-Who doesn’t like Marilyn Monroe? Councilmember Krekorian, that’s who! Why else would Councilmember Paul Krekorian support the demolition of one of the most significant homes of Marilyn Monroe? With the blessings of Mayor Garcetti, who believes in eradicating as much of Hollywood’s history as possible, and with the support of…





Record Breaking! Josh Groban sings Trump


LADWP Rates Overview

 

 

  

 

 

 

Frank McCourt: The Artful Dodger and His Crumbling Legacy

BOTTOM OF THE 9th, TWO OUTS, TWO STRIKES …  - Little spoiled Frankie McCourt is having a hissy fit ever since the Commissioner of Baseball, Bud Selig, rejected the Dodgers $1.7 billion media rights transaction with Fox Sports.  And as part of his tantrum, he is threatening to sue Major League Baseball, especially if the Dodgers are seized by Major League Baseball and put up for sale because of his inability to meet payroll and other financial obligations.
He is also carrying on by saying that he will not sell Dodger Stadium, the parking lots, and other related assets that are controlled by other entities in his convoluted, but crumbling, corporate quagmire, hoping to discourage legitimate buyers from buying the Dodgers.

Obviously, Frank has not reviewed the contract he signed with MLB when he and Princess Jamie purchased the Dodgers in 2004.  

As a way of background, on Friday, June 17, The Boston Parking Lot Attendant was a happy camper as he and Princess Jamie agreed to a Binding Term Sheet where she agreed to consent to the 17 year, $3 billion media rights deal between the Dodgers and Fox Sports that included a $385 million upfront loan to the Dodgers.

These two lovebirds also agreed to a one day Expedited Trial (presumably on August 4) to determine if the Dodgers and the related assets (the “Dodger Assets”) are community property or Frank’s separate property.  

If the Dodger Assets were deemed to be community property, they were to be sold in an “orderly manner” under the supervision of the Court. But Frank would have a natural advantage given his current level of ownership and the convoluted corporate structure.   

If Dodgers were deemed to be Frank’s separate property, then Frank would pay the Princess $100 million, $55 million upfront and $45 million over the next two years.  

But this whole arrangement which would allow Frank to get his grubby little mitts on all that cash was contingent upon the MLB approving this Hail Mary deal with Fox Sports. Otherwise, the Binding Term Sheet would be null and void.

But the Commissioner did not approve the deal, citing that it was not in the “best interests” of the Dodgers and the game of baseball.

For openers, Frank was “diverting” $173.5 million (45%) of the $385 million loan for his personal needs which has the effect of mortgaging the Dodgers’ future. And this continued looting of the Dodger franchise was contrary to Frank’s previous statements that all money would be invested in the team.  

The uses included $10 million for the attorneys; $10 million of walking around money; $23.5 million to repay Frank for his 2011 advances to the Dodgers to help meet payroll; $80 million to pay down Dodger debt that was used to purchase the club; and $50 million to fund an account under the supervision of Court.

At the same time, the Dodgers are one of nine teams that are reportedly in violation of Major League Baseball’s Debt Service Rules.  The other eight teams are the Baltimore Orioles, Chicago Cubs, Detroit Tigers, Florida Marlins, Philadelphia Phillies, Texas Rangers, New York Mets, and Washington Nationals.

There is also the belief that the Fox Sports transaction undervalues the media rights of the Dodgers.  On the one hand, Frank values this deal at $3 billion while MLB is at $1.7 billion, a considerable difference that could have an adverse impact on all of MLB’s media rights.  

The Dodgers are also hemorrhaging cash. Attendance for the first 40 home games is off 20% from last year. But revenues are probably off at least 25% to 30% as a result of increasing no shows, extensive price discounting of tickets, and large discounts offered to corporate sponsors such as United Airlines for early payment.  As a result of the loss of this highly profitable incremental revenue, the cash strapped Dodgers are most likely losing money before they even pay the interest on the mounds of debt.  

To compound the problem, MLB attendance of off by about 1.5% this year, but the Dodgers account for 77% of that loss.  

But the basic issue is that the Commissioner of Baseball does not trust increasingly desperate Frank to be responsible owner and steward of the Dodger franchise.

More than likely, the Dodgers will not be able to meet payroll next week which will precipitate a takeover of the Dodgers by MLB.  

Now one alternative that has been floated is that Frank will push the Dodgers into bankruptcy before he allows MLB to seize team.  But this will backfire since Frank does not have a well thought out plan or the necessary funds to effectuate a favorable outcome, especially since Fox Sports wants no part of a bankruptcy.

Furthermore, a bankruptcy filing is very long and drawn out affair, costing millions in legal and accounting fees.  And to complicate matters, the bankruptcy court may invalidate certain not so arms length contracts that the Dodgers have with various other McCourt controlled entities, forcing these entities to default of their bank debt. As a result, Frank’s house of cards would collapse.

While little Frankie may want to conduct a scorched earth policy, Princess Jamie may have other ideas on how to protect her lifestyle and her nest egg.

And based on her prior actions, she will push to have the Dodgers and all of the related assets sold in an “orderly manner” under the supervision of the Court, as outlined in the Binding Term Sheet.

We can only pray that is the case.  So Judge Scott M. Gordon of Superior Court, hear the prayers of all Angelenos and order the sale of the Dodgers (and the related assets).

Frank has said that he wanted to pass the Dodgers down to his sons.  However, given the reaction of the True Blue fans, Angelenos, the sports writers and the media, Major League Baseball, and his lenders, the only thing that he will pass down to his family is a legacy that will make Donald Sterling, Bruce McNall, and Bernard Madoff look like choir boys.

So Frank, do the right thing: Sell the Dodgers in an orderly manner.  And take the bus back to Bean Town.  

(Jack Humphreville writes LA Watchdog for CityWatch He is the President of the DWP Advocacy Committee and the Ratepayer Advocate for the Greater Wilshire Neighborhood Council. Humphreville is the publisher of the Recycler -- www.recycler.com. He can be reached at:  lajack@gmail.com )
–cw

Tags: baseball, Dodger, Frank McCourt, Commissioner Bud Selig, Fox Sports, Jamie McCourt, MLB, Major League Baseball,




CityWatch
Vol 9 Issue 50
Pub: June 24, 2011

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