Chicago Cubs fans may not be happy with their team's place in the standings, but there may be a sense of schadenfreude in knowing that one of the most reviled men in baseball, former Dodgers' owner Frank McCourt, is back in court. McCourt's ex-wife Jamie says she reluctantly filed suit after other approaches failed. She says McCourt understated the value of the Dodgers in the couple's property settlement.
The team was a major bone of contention in the divorce from the beginning. McCourt had bought the team during the marriage, but the couple had taken care of the ownership in a postnuptial agreement. Or so they thought: A number of drafting and procedural errors resulted in protracted litigation. In the end, Jaime gave up her claim to the team in exchange for $131 million. The couple divorced in a community property state.
During negotiations, McCourt maintained that the team was worth less than $300 million. The team filed for bankruptcy in June 2011, about six months after the divorce was final. In May 2012, McCourt finally sold the team -- for $2 billion, more money than anyone has received for a professional sports franchise and $1.7 billion more than McCourt said the team was worth. The figure is notable for another reason, as well: At $300 million, McCourt would have taken a loss from his original purchase price of $430 million; as it was, he made a tidy profit.
Jamie's motion asks the court to throw out the settlement and claims that McCourt's lowball estimate of the team's value constituted fraud. Even if it was a mistake, the motion continues, the settlement is grossly unfair. The hearing is scheduled for November.
In the bankruptcy filing for the Dodgers, Major League Baseball accused McCourt of diverting almost $200 million of revenue from the team to cover personal expenses and to invest in business ventures that had nothing to do with the franchise. The couple's lavish lifestyle became public during the divorce.
Source: KNOE.com, "Ex-Dodger owner back in divorce court," Andrew Dalton, Sept. 26, 2012
Our firm works with men and women who want to modify their property settlements, as Jamie McCourt did initially. To learn more about our practice, please visit the Lake County, Illinois, post-divorce decree page of our website.