Dodgers cite Texas Rangers in opposing Fox Sports appeal
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This will not be one of the prouder legacies of Bud Selig’s tenure as baseball commissioner: This year’s team in bankruptcy citing last year’s team in bankruptcy in challenging the legal claims of one of baseball’s valued television partners.
The Dodgers on Tuesday asked a federal judge not to interfere with a U.S. Bankruptcy Court ruling that permits the sale of the team’s television rights as well as the team itself.
Fox Sports has appealed that ruling to the U.S. District Court and has asked for a stay pending the appeal. The court will hold a hearing Thursday on whether to grant the stay.
The court also has set a hearing on the appeal for Jan. 12. The Dodgers cannot negotiate with any potential television partner besides Fox until Jan. 19, and they argue a stay would be unnecessary.
‘The only thing that will happen before then is negotiations between Prime Ticket and the [Dodgers] -- negotiations that are already underway,’ according to the Dodgers’ filing.
On the crucial legal issue at hand -- whether the Bankruptcy Court had the authority to move up the negotiating window prescribed in the contract between the Dodgers and Fox, in the interest of maximizing the return for outgoing owner Frank McCourt -- the Dodgers cited what they said was precedent established in the case of the Rangers.
In that case, a Texas Bankruptcy Court ruled that the contractual right of lenders to approve a sale of the Rangers need not apply in bankruptcy. ‘It would be inconsistent with the authority and responsibility [of the debtor to maximize value] ... to give effect to a contractual provision that would frustrate the performance of its fiduciary duties,’ according to the Texas ruling.
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-- Bill Shaikin