Bids Being Filtered In Dodgers Auction

Over ten bids were submitted by prospective ownership groups for the Los Angeles Dodgers, and the investment firm handling the sale for Frank McCourt, The Blackstone Group, has winnowed the field down to at least eight. Mark Cuban, owner of the Dallas Mavericks, was not one of the bids that will advance to the final round. From the Los Angeles Times:

Mark Cuban was eliminated from the Dodgers’ ownership sweepstakes Friday, along with baseball executive and former agent Dennis Gilbert, according to two people familiar with the process but not authorized to discuss it.In addition, ESPN Los Angeles is reporting that the group headed by Steve Garvey and Orel Hershisher did not make the final cut. Bidding is reportedly expected to be at least $1.2 billion, with some estimates putting the eventual price just south of $2 billion.

Mark Cuban submitted a bid. Steven Cohen submitted a bid. Peter O’Malley submitted a bid. The group including Magic Johnson and Stan Kasten submitted a bid. The group including Joe Torre and Rick Caruso submitted a bid. The group including Stanley Gold submitted a bid. The group including Dennis Gilbert, Jason Reese and Randy Wooster submitted a bid. And so on. Bids were submitted. Lots of ‘em.

What happens now? More bids might come in. Some of the bidding parties might choose to consolidate. The bids will be evaluated by the bankers in charge of this process, and some of the parties will continue along while some of the parties might be eliminated.

How are things heating up? What does any of this actually mean? That’s where Bill Shaikin comes in. In this article from the Los Angeles Times, Shaikin answers a handful of key questions about the process. For example, what is a soft deadline?

So Monday is a deadline in that it is not really a deadline.* Got it.

Soon, perhaps quite soon, you’ll no longer have to see the name McCourt in these pages, at least not nearly as often as you’ve been seeing it for the last year or so.

The latest McCourt news?

News Corp.’s Fox has joined the auction process for the LA Dodgers by signing a nondisclosure agreement, the Wall Street Journal, which is also part of the entertainment conglomerate, reported.

The company, however, does not want to fully own the baseball franchise, like it did from 1998 to 2004, but is eyeing a minority stake to boost its chances of keeping the valuable Dodgers TV rights, according to the Journal..

It cited sources familiar with the company’s thinking as saying it is interested in a 15 percent-20 percent stake.There are several groups and individuals interested in buying the team, but it doesn’t seem likely that the other groups would want to share ownership with another group holding a significant minority interest.

Oh, and about those TV rights:

The Los Angeles Times reports that a dispute between outgoing Dodgers owner Frank McCourt and Fox, owner of the team’s TV rights, has been settled:

The Dodgers had said they could command a higher sale price by marketing their television rights now. Fox had asked for the enforcement of its current contract, which forbids the team from negotiating with other broadcast outlets before Nov. 30. U.S. Bankruptcy Judge Kevin Gross ruled in favor of the Dodgers, but Fox appealed and Stark put the sale on hold.

The Dodgers agreed Tuesday to honor the existing Fox contract, which expires after the 2013 season. That leaves a new owner free to launch his own Dodgers cable channel starting in 2014, or leverage that threat into a bidding war between Fox and Time Warner Cable.This would seem to put the Dodgers sale on the fast track; as many as six groups have been linked to possible interest in buying the team. There is one thing that hasn’t been settled:

It’s pretty early to analyze seriously what a Joe Torre ownership group would mean for the Dodgers -- there are other, high-powered groups vying for the team, after all -- but it’s not too early to start speculating, which is exactly what Mike Scioscia’s Tragic Illness does:

Obviously this is far, far away, but it’s interesting to try to imagine what Torre might do if he returned to the team with some sort of executive power, similar to Nolan Ryan in Texas. You’d have to think he’d fight hard to retain Don Mattingly, as Shaikin also suggests, but what do we really know about his relationship with Ned Colletti?And as Bill Shaikin notes:

Joe Torre told Major League Baseball before the holidays that he was going to resign from his post to pursue a position with a group looking to purchase the Dodgers, and in the meantime, MLB will use a closer-by-committee approach to replacing him, in which “closer” is defined as “discipline czar.” From Jerry Crasnick:

Joe Garagiola Jr., Kim Ng and Peter Woodfork will do Torre’s job in the interim while MLB looks for a replacement.And as far as a permanent replacement goes, Jon Heyman throws Andy MacPhail as a possible replacement, probably because of his experience meting out punishment to the greater Baltimore area.

NEWS: Joe Torre has resigned as @MLB EVP/Baseball Ops to explore opportunities w/ group that will pursue ownership of @DodgersTorre was previously Major League Baseball’s Executive Vice President of Baseball Operations, which was informally known as the “Discipline Czar.” When pitchers would plunk hitters intentionally, and when players would rat-tail reporters with wet towels, Torre would be there to determine the length and severity of punishment.

Last month, the New York Times quoted Torre as saying that he was somewhat interested in pursuing a role with a potential ownership group:

The Los Angeles Dodgers filed for bankruptcy protection in June, and in September asked the court to auction off their media rights as part of a strategy to become solvent again. Fox Sports Net asked a federal judge to dismiss the case, saying that the team was perfectly capable of fulfilling its obligations, but using bankruptcy laws to avoid doing so.

On Thursday, the judge ruled that the Dodgers can sell their rights in an auction, which is seen as a huge win for Frank McCourt and the Dodgers, as the rights will make the team more attractive to potential buyers. From the Los Angeles Times:

We don’t yet know who all is going to get involved in the bidding. We know that Mark Cuban will probably be among them. And now we know that there is another group in contention - a group with an awful lot of name power. And financial power. A lot of financial power, too. Via the LA Times:

The group includes Magic Johnson, Stan Kasten and Mark Walter. Johnson is known for all of his basketballness. Kasten is the former president of both the Washington Nationals and the Atlanta Braves. Walter is the CEO of Guggenheim Partners, which supports Guggenheim Baseball Management. Walter is the guy with all of the money. Johnson and Kasten both have money, but they do not have money like Walter has money.

There are a lot of people in the greater Los Angeles area. More than Philadelphia and St. Louis combined. More than Minneapolis, even. It’s a big place.

The Dodgers are something of a gold mine for an owner who knows what he or she is doing, who understands that fans notice when an organization spends money to make the team better. After a year of Dodger fans hearing how their owner was broke because he was taking their money and shoveling it to crystal gropers, they still came out for the games. At a lower rate than before, but they still ranked 11th in overall attendance.

According to this tweet from Fox Sports’ Ken Rosenthal, Cuban spoke of possible interest in the Dodgers now that they’re officially on the market:

Since, according to the announcement of the sale Tuesday night, the Dodgers are going to be sold in a “court supervised process”, the price could be driven up — or down — by various factors including the number of bidders.

MLB took control of the franchise’s business and day-to-day operations last spring, citing “deep concerns for the finances and operations.” The team officially filed for bankruptcy in June, and in court filings filed last month MLB accused McCourt of “looting” nearly $200 million from the team’s finances.

Despite it all, McCourt was reluctant to officially put the team on the block, even though it’s long seemed inevitable to outside observers that the franchise would eventually change hands for a third time since 1998. McCourt purchased the team from Rupert Murdoch’s NewsCorp in 2004 for $430 million. The franchise, which includes the stadium and the surrounding land, could fetch a billion dollars or more on the open market.

Are the Dodgers finally, mercifully about to be sold by embattled owner Frank McCourt, who owes his ex-wife $130 million and those who bleed Dodger-blue blood a lifetime’s worth of penance?

As Bill Shaikin writes, maybe. As Bill Shaikin also writes, maybe not. It’s like the Lords of Baseball meeting Siddhartha Gautama.

In the filing, the league claimed McCourt funneled $73 million in parking revenue through Blue Land Co., a non-team related entity; used $61.16 million in team revenue to pay off personal debts; and took $55 million from team revenue for personal distributions.I’m sure it makes Dodger fans happy to know that every dollar they’ve spent in tickets, food, and Manny wigs at Dodger Stadium all went to McCourt for his chinchilla remote cozies, which is why MLB claims that he “has completely alienated the Dodgers’ fan base.”

McCourt and the Dodgers volleyed charges back at MLB, saying ...

The rest of the Times article details the history of the McCourt divorce, including the “lavish lifestyle” lived by both Frank and Jamie McCourt, “ultimately financed by Dodgers fans”:

It would seem that everyone connected with baseball will be better off when this is all finally settled.

The reason this document has been released now is it shows how the Dodgers will spend a $150 million loan from Highbridge Capital Management, of which the Dodgers have already accepted $60 million. The loan will be discussed at a court date on July 22, along with a competing proposal for short-term financing from Major League Baseball that the Dodgers don’t want to accept because they fear it will give Bud Selig too much leverage against the team.

Meanwhile, during a press conference on Tuesday, Selig implied that the Dodgers would soon be under new ownership.

A judge has ruled that a hearing in the Los Angeles Dodgers’ bankruptcy process will not require the presence of Bud Selig, and that Major League Baseball will not need to turn over an array of documents to the Dodgers, the Los Angeles Times reports.

“This is clearly, in my mind, not an appropriate occasion to turn this hearing into a trial on the commissioner,” U.S. Bankruptcy Judge Kevin Gross said.Gross’ decisions (he denied the Dodgers’ motion to have MLB turn over documents from 31 categories, deeming them “not relevant”) are, in sum, a win for MLB, which may have gotten slightly closer to wresting control of the insolvent Dodgers from owner Frank McCourt, whose financial woes have led to this declaration of bankruptcy. The hearing, on July 20, will determine whether McCourt can pursue his own external bankruptcy financing or will be forced to accept MLB’s offer of a loan.

The Dodgers claim these documents demonstrate “the commissioner’s real agenda” with regard to the team (essentially, to treat the organization differently from other teams that it argues have had similar situations), while the MLB contends that the documents are irrelevant to the Dodgers’ bankruptcy and financing of the team, which is what’s really at issue.

MLB’s opposition to the motion was the latest move in the wrangling between the embattled Dodgers organization and Major League Baseball. Dodgers owner Frank McCourt has accused the commissioner’s office of preventing the team from getting the money it needs (by vetoing a huge new television deal that commissioner Bud Selig felt would give McCourt money he didn’t deserve). Meanwhile, McCourt has “treated the team like a personal bank,“ contributing to its mountain of debt. Major League Baseball argues that the documents to which McCourt is seeking access merely show how badly McCourt has run the team.

Selig is set to be deposed in two weeks by lawyers representing Dodgers owner Frank McCourt, according to a bankruptcy court filing late Thursday via a report in the Los Angeles Times. According to the deposition, Selig would be required in court on July 15.

While in court, McCourt’s lawyers are looking for Selig to answer two important questions according to the Times: How the MLB approved the Dodgers’ interlocking entities and rent payments to which the league now objects as well as how the MLB devised and implemented what McCourt has said is an MLB investigation with a “predetermined” outcome of ousting him from ownership.

The Los Angeles Dodgers’ bankruptcy filing, a move designed to alleviate some of the financial pressures on Dodgers owner Frank McCourt, has another major foe: Major League Baseball. In papers filed to a Delaware bankruptcy court on Tuesday, MLB is objecting to the Dodgers’ bankruptcy filing, citing concerns about the Dodgers leveraging future assets to pay for current debts.

Commissioner Bud Selig claims in the filing that his office can provide a loan on better terms, and argues that the court should reject McCourt’s financing proposal because it compels the team to sell valuable future broadcast rights to meet current expenses and to provide money for McCourt’s personal use.Broadcasting rights have become one of the most lucrative assets a professional sports team can claim, especially in the Los Angeles area. The Los Angeles Lakers’ television rights deal with Time Warner Cable reportedly could rake in up to $3 billion, and the New York Yankees and Boston Red Sox have been able to maintain their massive payrolls in part because of substantial revenue from regional sports networks.

Because the Dodgers have filed for Chapter 11 bankruptcy protection and they are going through (possibly long) bankruptcy proceedings, that loan has to be approved by a judge. This is where MLB steps in with an alternative option that the judge could force McCourt to take instead of the loan he found for himself. Speculation is that their offer might include a provision that the team be sold to the highest bidder, which a bankruptcy judge might find exceptionally appealing, even if McCourt doesn’t.

That offer is purely speculation, though, as there are currently no details out on a potential MLB offer. If McCourt gets his way and secures the loan he got for himself, these bankruptcy proceedings could take a long time.

Even more impressively, every starting Dodger got at least one hit, drove in at least one run and scored at least once. This feat had not been accomplished by a Dodgers team since 1930, and it’s only been done 45 times since 1919, less than once every two years on average.

Dodgers players claimed the bankruptcy news had nothing to do with this offensive explosion:

There was a time when the Dodgers were the Yankees of the West Coast. They completely dominated the Southern California market, and in 2000 they had the second-highest payroll in baseball, just behind the Yankees. The progression of their payroll compared to their peers since then: