Big picture: Whither McCourt now?

Nothing that happened in bankruptcy court today specifically precludes Frank McCourt from getting the television deal that would keep his Dodger ownership alive. So what’s the endgame that could push McCourt out?

There’s still the possibility that MLB strips McCourt of ownership, for violating the sport’s rules that he agreed to abide by when he became owner, but the ability for MLB to do that while the Dodgers are in bankruptcy court is unclear.

Instead, everything might rest on whether MLB is able to delay a new television deal long enough to starve McCourt from meeting his personal obligations in a way that would allow him to emerge with the franchise.

Remember, it’s the Dodgers who are in bankruptcy court, not McCourt. So none of the $150 million loan that the bankruptcy court is facilitating is supposed to go into McCourt’s pocket — it’s supposed to satisfy the Dodgers’ creditors. If McCourt can’t pay his own personal debts (complicated by his dealings with ex-wife Jamie), he would presumably have to start eating into his assets. Or, I suppose, file for bankruptcy himself.

So we’re back to discussing TV revenue.

Fox has exclusivity though November 2012 on any negotiations for future Dodger TV rights. As was confirmed earlier today, Bud Selig believes there has to be competitive bidding for TV rights to ensure that the Dodgers are getting fair market value. McCourt ostensibly either needs a judge to bless that bidding (which would be contested by Fox), or get a judge to overrule MLB and approve a Fox-McCourt extension.

Would the court approve a Fox-McCourt deal over MLB’s objections? It’s not clear, but given the conflict-of-interest concerns at the heart of today’s ruling by Judge Kevin Gross and the knowledge that the deal would largely serve McCourt at the Dodgers’ expense, I think there’s reason for the anti-McCourt camp to feel some hope.

This should come to a head as soon as a hearing scheduled for August 16. Josh Fisher has more at ESPNLosAngeles.com:

… A Dodgers attorney said in a statement that the team “will propose … a competitive sale process of exclusive cable television rights” before the end of this calendar year. However, the Dodgers will find themselves in an awkward negotiating position with current partner Fox.

Under the terms of the existing television deal, the Dodgers cannot begin negotiating with anyone other than Fox until late 2012. That has led baseball to express concerns about the desirability of extensions of the Fox deal thus far proposed by McCourt. However, because of the club’s bankruptcy, it may have the option to walk away from the Fox contract and sell the Dodgers’ television rights competitively.

MLB will likely oppose such treatment of an important strategic partner. While today’s ruling signals Gross’ willingness to curtail baseball’s policies to the extent necessary to achieve bankruptcy’s purposes, he may not be as willing to entertain a move with potential negative impact across the game. Make no mistake, the fight over the Dodgers’ ability to sell their TV rights will be as bitter and acrimonious as any thus far. The outcome will determine how much longer the Dodgers remain under McCourt ownership. …

Hold your breath …

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