MLB late this morning scored a key victory in the Dodgers bankruptcy case, winning a ruling that denied the club's pursuit of a massive discovery request. The Dodgers sought a wide array of documents it believes would have shown a pattern of mistreatment by MLB Commissioner Bud Selig. But Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware said, "This clearly in my mind is not an appropriate occasion to turn this into a trial on the commissioner." The ruling comes after MLB yesterday issued its own stinging rebuke to the Dodgers' recent requests for a sweeping series of depositions and document submissions in the club's ongoing bankruptcy case. In the filing with the U.S. Bankruptcy Court, the league called Dodgers Owner Frank McCourt's extensive discovery requests "wholly irrelevant" and "a multi-ringed sideshow of mini-trials." McCourt was seeking 31 separate categories of document submissions from the league, elements he believes will show a premeditated animus from Selig to separate him from the team. But MLB in its filing said 28 of those categories, some covering requests for other club RSN deals dating back to '06 and the Mets' financial records, have nothing to do with the club's debtor-in-possession financing and how to fund near-term operations, the issues most immediately before the bankruptcy court. Additionally, the league said McCourt's plans to depose seven senior MLB execs, including Selig, are frivolous as most had nothing to with constructing the league's proposed DIP financing for the Dodgers. "Mr. McCourt cannot use the DIP motion (or these proceedings) to conduct a fishing expedition as to the internal administration of Major League Baseball," the filing reads in part. MLB went on to call Selig "a singularly unique, public figure who should not be subject to unwarranted harassment and discovery abuses." Today's session will serve as a prelude for a July 20 hearing in Wilmington on rival DIP financing proposals from MLB and HighBridge Capital. MLB Exec VP/Labor Relations & HR Rob Manfred said in an interview late yesterday that the Dodgers' document requests represented a breach of club-specific data that is not shared among franchises. "You take discovery in relation to the motion before the court, and the motion before the court right now is the DIP financing," he said. "Everything else is irrelevant” (Eric Fisher, SportsBusiness Journal).
MONEY MATTERS: The league's filing yesterday also alleges McCourt, already with a lengthy history of using team funds to finance a lavish lifestyle, of seeking in late April another $20M in personal distributions from the club (Fisher). In L.A., Bill Shaikin notes McCourt in mid-April “took a $30-million personal loan from Fox, using $20 million to fund the first payrolls of the season.” Selig soon thereafter appointed former Rangers President Tom Schieffer trustee of the Dodgers' finances, and a source said that McCourt responded by asking that the $20M “be returned to him since he would not have final say over the money.” Dodgers Senior VP/Public Affairs Howard Sunkin said, “This is just another example of MLB trying to disparage an owner by leaking confidential information to the media from an unnamed source. This has been their mode of operation since last fall” (L.A. TIMES, 7/7).
