MLB sends Dodgers/Fox rights deal to the showers

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The Los Angeles Dodgers are one of Major League Baseball’s marquee franchises, but they are also in deep financial trouble, much of which is related to the personal travails of the team’s ownership. MLB has struck down a deal with Fox for 17 years worth of broadcast rights that Commissioner Bud Selig determined was not in the best interests of the team and its fans.


The deal would include an upfront payment of $385M, which would go to meeting the immediately forthcoming payroll obligation. But much of it would also go straight to Frank McCourt and former wife Jamie, partly to meet obligations of their divorce settlement.

Selig objects to so much cash being diverted to the personal use of the McCourts.

MLB also believes that the deal with Fox is a bad one in the long run, and short-changes both the team and potential future owners. The total long term value is in dispute – according to the Los Angeles Times, McCourt believes it is worth $3B or more, while MLB pegs it more in the $1.7B range.

If McCourt is unable to meet payroll, the team may be seized by MLB. The next payroll date is 6/30/11. It is expected that McCourt will respond with legal action.