Published October 25, 2011
By Tom Hals
(Reuters) - Los Angeles Dodgers owner Frank McCourt "looted" $190 million from the bankrupt team to fund his lavish lifestyle, which includes eight homes, according to court documents filed on Tuesday by Major League Baseball.
The league stepped up its battle to oust McCourt as owner of the franchise by arguing he was draining the team's financial lifeblood.
The Dodgers filed for bankruptcy in June after the league's commissioner, Bud Selig, rejected the team's proposed deal to sell its broadcast rights to generate desperately needed cash.
The Dodgers plan to get out of Chapter 11 by striking a new deal to sell the media rights. The team is hoping that the bankruptcy judge will overrule league objections.
The league has argued the only way to end the bankruptcy is to force McCourt to sell the team, and Tuesday's filings with Delaware's bankruptcy court hammered at what the league said was McCourt's mismanagement.
The league said he took $61 million from the team to pay personal debts, $73 million from team parking revenue and $55 million from the team's untapped equity.
"The Dodgers are in bankruptcy because Mr. McCourt has taken almost $190 million out of the club and completely alienated the Dodgers' fan base," the league said in court documents.
The Dodgers said in a statement the league's "inflammatory allegations" were not supported by the evidence.
"As the Commissioner knows and as our legal documents have clearly shown, he approved and praised the structure of the team about which he belatedly complains. We look forward to the opportunity to show the truth next week in court."
A four-day court hearing is scheduled to begin October 31 to determine the best way out of bankruptcy. McCourt and the league's commissioner are expected to testify.
Separately, fans were given a role in the baseball team's bankruptcy.
Two season ticket holders were granted seats on the unsecured creditors committee, which can raise objections and conduct investigations with funds provided by the team.
One seat will be held by a representative of the estate of the late entertainer Frank Sinatra. The Sinatra estate had taken a lead role in seeking a voice for season ticket holders.
The unsecured creditors committee also includes suppliers as well as a representative for Bryan Stow, a San Francisco Giants fan who was beaten so badly at the Dodgers' opening day game that he ended up in critical condition.
Fan boycotts and fears about security at the stadium drove Dodgers' attendance down nearly 20 percent in 2011 to its lowest level in a decade.
The bankruptcy case is In re: Los Angeles Dodgers LLC, U.S. Bankruptcy Court, District of Delaware, No. 11-12010.
(Reporting by Tom Hals in Wilmington, Del., editing by Matthew Lewis, Phil Berlowitz)