Bloomberg News

L.A. Dodgers Hearing Over Future of Team Delayed to Nov. 29

October 26, 2011

(Updates with order that Fox, MLB give Dodgers documents in second paragraph.)

Oct. 26 (Bloomberg) -- Los Angeles Dodgers’ owner Frank McCourt won an extra month to prepare for a court battle with Major League Baseball Commissioner Bud Selig over control of the team when a judge rescheduled the hearing to Nov. 29.

U.S. Bankruptcy Court Judge Kevin Gross today also ordered MLB and News Corp.’s Fox Sports to turn over to the Dodgers any e-mails they exchanged about the team before it filed bankruptcy in June. Dodgers’ lawyers claim the documents will help them show during the November hearing that Selig is unfairly trying to force McCourt to sell the team.

At the hearing, scheduled to last through Dec. 2, McCourt and the Dodgers will seek approval to sell the team’s future television rights in order to raise enough money to pay creditors in full and exit bankruptcy. Selig will try to persuade Gross to force a sale of the team.

Fox and MLB oppose a sale of the TV rights for different reasons. Selig argues the sale would divert money from the team to be used by McCourt to settle his personal debts. Fox claims it has an exclusive right to negotiate for an extension of its current television rights until next year.

“While Fox clearly has a common interest with MLB on the telecast rights motion, it does not have a common interest when it comes to ousting Mr. McCourt,” Gross said in his order requiring Fox and MLB to turn over documents. Fox tried to convince Gross it had a common legal strategy with MLB to oppose the Dodgers and therefore didn’t have to turn over certain documents prepared by its attorneys.

The court fight in November will turn on whether McCourt or Selig is acting in “bad faith.” To meet the legal definition of bad faith, MLB and the Dodgers are collecting evidence to try to undermine the other side’s motives for taking various financial actions related to the team.

The case is In re Los Angeles Dodgers LLC, 11-12010, U.S. Bankruptcy Court, District of Delaware (Wilmington).

--Editors: Glenn Holdcraft, David E. Rovella

To contact the reporters on this story: Steven Church in Wilmington, Delaware, at schurch3@bloomberg.net; Michael Bathon in Wilmington, Delaware, at mbathon@bloomberg.net

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net


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