Thursday, July 7, 2011
Judge denies Dodgers' motion
DOVER, Del. -- A Delaware judge on Thursday denied a request by the Los Angeles Dodgers to order Major League Baseball to turn over a vast array of documents in the team's bankruptcy case.
The Dodgers sought a wide range of records they believed would bolster their argument that commissioner Bud Selig and MLB have treated the team unfairly and should not be allowed to serve as its bankruptcy lender.
But Judge Kevin Gross agreed with MLB attorneys that the information the Dodgers were seeking was irrelevant to the immediate issue of the team's proposed bankruptcy financing plan, which is subject to a July 20 hearing.
"The discovery is really at this point overbroad and burdensome," Gross said. "... This is clearly in my mind not an appropriate occasion to turn the hearing into a trial of the commissioner."
Gross also indicated that the Dodgers' request to depose Selig was improper, saying depositions should be limited to people most knowledgeable about the major leagues' analysis of the Dodgers' proposed financing plan and MLB's competing loan offer.
The information sought by the Dodgers included records regarding MLB's investigation of the team and owner Frank McCourt, its decision to reject a broadcast rights deal between the Dodgers and Fox Sports, communications between Selig and the monitor he appointed to oversee the Dodgers, and communications between the league and McCourt's ex-wife, Jamie, who is seeking half of his ownership assets.
The Dodgers also sought league records regarding last year's bankruptcy filing by the Texas Rangers and the league's recent dealings with the New York Mets, whose owners are embroiled in the Bernard Madoff Ponzi scheme scandal.
"The best evidence of what Major League Baseball will be doing going forward is what it did in the past," said Dodgers attorney Bruce Bennett.
The loan offer by the league has better financial terms than the team's financing arrangement with hedge fund Highbridge Capital. But the Dodgers argue that the league's offer is simply a veiled attempt to take control of the team and force a change of ownership, and that they should not be required to accept financing from an entity "overtly hostile" to the team's best interests.
"We concede that cheaper is normally better, but it isn't always better," Bennett said.
Glenn Kurtz, an attorney for Selig's office, said the league has agreed to produce documents regarding its offer to provide debtor-in-possession financing to the Dodgers, but that much of the information sought by the team was irrelevant to the financing issue and instead related to McCourt's individual disagreements with Selig and the league.
"This is generally not the time or venue for Mr. McCourt to try to litigate with the commissioner," Kurtz said.
Gross, who has given interim approval to the Dodgers' proposed $150 million financing arrangement with Highbridge, acknowledged that many of the issues involving the team's relationship with the league may come before him at some point, but that he was not going to turn the financing motion into a hearing on collateral matters.
In a statement released by a spokeswoman after the judge's ruling, the Dodgers said they still expect their financing proposal to be approved at the July 20 hearing.
"As the court indicated, there will be other opportunities in this bankruptcy case for the Dodgers to obtain the discovery that MLB does not want to share with the Dodgers and the court," the statement read.