LA Dodgers Seek Bankruptcy Protection

LA Dodgers Seek Bankruptcy Protection

Los Angeles : CA : USA | Jun 27, 2011 at 9:37 AM PDT
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It doesn't happen very often, but it looked like the only way for Frank McCourt to survive through these financial difficulties. McCourt, as the leader of the Los Angeles Dodgers organization, filed for bankruptcy protection Monday that would pit his ownership interest in jeopardy with Major League Baseball.

According to a statement released right after the Federal court filing in Delaware, McCourt said that he has obtained $150 million in bridge funding to meet this Thursday's payroll deadline if the court approves. He continues his control of the club through the bankruptcy proceedings unless and until the court deems otherwise.

Under the MLB constitution, an ownership act of filing for bankruptcy triggers the ability of the commissioner to strip McCourt of ownership. However, bankruptcy court proceedings generally override MLB rules.

The list of creditors and amounts must be part of the filing when a person or company seeks the courts protection. Manny Ramirez is the Dodgers' largest creditor, according to the bankruptcy filing. The Dodgers owe Ramirez $21 million, followed by Andrew Jones ($11 million), Hiroki Kuroda ($4.5 million), Rafael Furcal ($3.7 million) and the Chicago White Sox ($3.5 million, for the salary of Juan Pierre). In most of these instances, the amounts reflect deferred salaries that players agreed to with the belief that the organization had the wherewithal to meet the obligation.

The list of creditors includes much of the current Dodgers roster, Hall of Fame broadcaster Vin Scully ($152,778), the city of Los Angeles ($240,563 in tax debt) and two players yet to play for the Dodgers (prospects Zach Lee at $3.4 million and Alexander Santana at $499,500).

In a statement issued on McCourt's behalf, the filing was said to have been done "in order to protect the franchise financially and provide a path that will enable the Club to consummate a media transaction and capitalize the team."

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Frank McCourt
Sought the Help and Protection of the U.S. Bankruptcy Court to save the L.A. Dodgers
Nathaniel Hines is based in Florianópolis, Santa Catarina, Brazil, and is an Anchor on Allvoices.
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