League asks court to terminate Dodgers exclusivity to allow sale plan

By Caroline Salls

Pittsburgh, Sept. 23 - Major League Baseball asked the U.S. Bankruptcy Court for the District of Delaware to terminate Los Angeles Dodgers LLC's exclusive periods for filing and soliciting votes on a plan of reorganization to allow a sale of the team, according to a Friday court filing.

As an alternative to termination of the team's exclusivity, the league also suggested that the court order the Dodgers to file a motion for assumption or rejection of its baseball agreements.

The league said Los Angeles Dodgers' "admittedly cash-strapped owner" Frank McCourt Jr. is attempting to cause the team to use its rights as a Chapter 11 debtor to violate its obligations to Major League Baseball. The league also said McCourt is attempting to use those rights to breach contractual obligations to Fox Sports by selling future telecast rights to the highest bidder, whether or not that bidder is approved by the league.

"The transaction and its timing are motivated by Mr. McCourt's personal financial difficulties and his unrealistic hope of generating substantial proceeds from the sale of an asset that belongs to the Dodgers and exists solely because of the activities of the Dodgers as part of Major League Baseball, with much of such proceeds then being available to satisfy Mr. McCourt's personal liabilities," the league said in the motion.

"This course of action is inconsistent with the underlying purposes and policies of the Bankruptcy Code, and violates the rules and regulations of Major League Baseball."

The league said the Dodgers' case is being used to advance McCourt's interests in a way that would hurt the Dodgers, Major League Baseball and its other teams.

According to the motion, a sale of the Dodgers is the only path to emergence from bankruptcy and would allow for payment of allowed claims in full in cash and the distribution of surplus proceeds to equityholders.

A hearing is scheduled for Oct. 12.

Major League Baseball team Los Angeles Dodgers filed for bankruptcy on June 27. The Chapter 11 case number is 11-12010.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.