Ken Gurnick of MLB.com reports that the Dodgers filed a reorganization plan in bankruptcy court that shows the club near $600 million in debt.
The Dodgers filed their reorganization plan with a federal bankruptcy court in Delaware on Friday, which will bring the club out of Chapter 11 protection through a sale of the team by April 30.
The club, which has been hamstrung by $573 million in debt, is expected to fetch $1.5 billion or more through the auction.
In reality though, it’s far worse than that, as Bill Shaikin of the Los Angeles Times explains on Twitter.
McCourt owes $573m in team debt, $131m to ex-wife, up to $200m on tax liability. That’s up to $904m, with any Stow liability TBD. #dodgers
That’s a potential disaster waiting to happen and it could leave Frank McCourt with no room for profit, but Lester Munson of ESPN explains how Frank McCourt has a chance to come out on top.
At the earliest possible moment in the litigation process, McCourt’s new lawyers asked Sanders to dismiss that case, and she quickly agreed, leaving the Bingham firm with no option beyond an appeal of her ruling — an appeal that appears, based on legal precedents, to be hopeless. Other law firms, caught in similar circumstances, have tried the same maneuver in at least eight states, and none has succeeded.
Court papers show that McCourt will be looking for hundreds of millions of dollars in the malpractice suit. His lawyers from the Bartlit firm, led by Fred Bartlit and Glen Summers, will argue that Silverstein’s error and the court ruling on the ownership of the team prompted both MLB commissioner Bud Selig’s effort to drive McCourt out of baseball and subsequent rulings in the Dodgers’ bankruptcy case that have resulted in the auction of the team.
The amount of McCourt’s losses is not yet known, but they are substantial. The bidding on the sale of the Dodgers will be a key factor. If the price is low, he could walk away from the franchise with a net of nothing, which would add to his claim against Silverstein and the Bingham firm.
None of the lawyers involved in the McCourt-Bingham dispute would discuss it with ESPN.com, but there is little doubt that it will be one of the largest legal malpractice cases in the history of American jurisprudence. If the auction goes badly, McCourt’s damages could be more than $500 million.
While I would prefer he suffer, I’m at the point where I honestly don’t care what happens, as long as he has nothing to do with the Dodgers ever again.