Several motions and objections were filed today in the ongoing Dodgers bankruptcy case, serving as a run-up to Wednesday's hearing in Wilmington, Del., on competing interim financing proposals from MLB and club owner Frank McCourt in tandem with Highbridge Capital Management. Most notably, McCourt angrily responded to MLB's objection last week of the Highbridge bid, saying that MLB Commissioner Bud Selig is "hostile to both the interests of [me] and the Dodgers," and as a result is an unfit bidder.
Selig has "an eye jaundiced by irrational animosity toward Mr. McCourt," the filing reads in part. McCourt in the filing continued, "It is well within a debtor's business judgment to decline such a 'deal with the devil.' " McCourt also challenged MLB's previously redacted claim that he had taken $180M out of the team for personal distributions, saying the number is less than "$30 million during the seven-plus year tenure as owner." In doing so, he said "most of the payments about which Commissioner complains relate to the real property assets - and not to the Dodgers and the club assets." And the filing called MLB's prior assertion that McCourt has a "substantial personal stake" in the Highbridge bid being approved "patently false.”
The Dodgers, according to the filing, intend to exit bankruptcy by the end of ‘11, and want to use a scheduled Aug. 16 hearing in Wilmington to set new guidelines for the sale of the club's cable TV rights.
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Meanwhile, the committee representing unsecured creditors in the case today filed a limited objection to McCourt's proposed interim financing plan. The panel, just formed last week and including the MLBPA and family of critically injured MLB Giants fan
Bryan Stow, among others, said the rival interim financing bid from MLB is "economically superior." But it added "the committee understands [the Dodgers'] concerns with the proposed [MLB financing] given the tense relationship with the parties.” The panel requested several modifications be made to the Dodgers' interim financing bid from Highbridge, including the removal of $10M in fees it called "excessive" and the removal of team assets as collateral to secure the loan.
MLB today also filed a supplemental objection to McCourt's interim financing bid from Highbridge. On top of previously stated arguments that the league's proposal would carry lower interest rates and overall costs, MLB said its bid would allow for an additional $250M in borrowing if needed, under league control. The league also filed a detailed side-by-side comparison of the two interim financing bids, a breakdown it believes clearly shows the superiority of its proposal.
The Dodgers said in a separate filing they are seeking to withhold any severance pay to former Exec VP/Communications Charles Steinberg until they investigate "whether Steinberg may have taken any actions while an MLB employee that were adverse" to the club. Steinberg now works in Milwaukee as a senior public affairs advisor to Selig.
