Are the Rangers going to stiff Alex Rodriguez?


UPDATE: OK, some more research leads me to believe that the answer in the headline is “no” A-Rod is not going to get stiffed. At least probably not.

It’s possible and, in “prepacked” bankruptcies like this one, common, for the debtor (i.e. the Rangers) to  file for bankruptcy when it has the assets
to cover the liabilities but can’t pay the liabilities exactly as they come due
. This sort of Chapter 11 may allow the debtor to hold a sale — say, to someone like Chuck Greenberg! — to get fresh
cash and to restructure the timing of payments.

Upshot: A-Rod and all of the other creditors (which includes Mickey Tettleton of all people) are still quite likely to get their money, even if there is some sort of delay or disruption.

I think we all learned something today kids: bankruptcy is difficult to understand. And kind of boring, frankly. So unless a ballplayer shoots someone this afternoon, it’s going to be actual baseball content for the rest of the day.

2:09: I am obviously not a bankruptcy expert, but thankfully some of you are, and you have informed me that I got some stuff wrong below. Let me, to the best of my ability, fix it.

The notion that unsecureds don’t get paid is not accurate. They do get paid, and often, but it’s usually pennies on the dollar. Moreover, they are paid at the same rate, so if Alex Rodriguez gets, say, 50 cents on the dollar, all the unsecured creditors get 50 cents on the dollar.  It would not be kosher, then for A-Rod to get his $24.9 million and the others to get stiffed.

The practical implication of this is that yes, A-Rod is likely to get at least partially stiffed. Because if he gets all of his $24.9 million, all the creditors get all of their money and then, by definition, there is no point of a bankruptcy (i.e. a bankruptcy is defined by owing more money than you have). Since the Rangers filed for bankruptcy it means they don’t have enough money to pay all of their unsecureds at a 100% rate. That means that A-Rod should not get all the money he thought he’d get and all of the ugly union/team dynamics set forth below come into play.

Another point of clarification: there can’t be a “side deal” between the Rangers and A-Rod, because that would violate bankruptcy laws which prohibit a debtor agreeing to make preferential payments to certain creditors before the filing. I didn’t intend that meaning when I said “side deal” — I really meant that there was some understanding on A-Rod’s part that he would be taken care of in the normal bankruptcy process — but that seems far less likely given the pro-rata thing outlined above, even if it were proper for the Rangers to make such an assurance, which I’m not sure is the case.

I’d ask that the bankruptcy experts among you continue to help me out with this stuff, but for now anyway, it seems like, yeah, A-Rod is gonna walk away with less money than he bargained for.  I can’t help but think that this will become something of a problem for baseball going forward.

1:15 P.M.: Pfun Pfact from the Rangers bankruptcy filing: the largest unsecured creditor is Alex Rodriguez, who is still owed
$24.9 million in deferred compensation from his big $250 million deal.

“Unsecured” means that Mr. Rodriguez does not have any collateral for the amount of money he is owed.  Unsecured creditors rarely if ever get any of the money they’re owed when the debtor goes into bankruptcy. Your mortgage company is secured (i.e. it has a lien on your house) which means that if you stiff them, they can take the house back to satisfy what you owe them.  Your credit card company, in contrast, is an unsecured creditor. If you stiff them they can try to collect from you and can ruin your credit rating, but they can’t take your stuff and, for the most part, once you file bankruptcy, its game over for them. Which is the biggest reason why credit card companies donate a lot of money to Congressmen in order to get them to make it harder for you and I to file bankruptcy.

But that’s a subject for another blog. Let’s you and I stick to Alex Rodriguez. Is A-Rod SOL?  Are the Rangers going to really just walk away from the money they owe him? The short answer: I don’t know.

The longer answer: man, I can’t see them just doing that. Lots of teams owe deferred compensation to players. Indeed, I think the Diamondbacks spent more time in the last decade working on deferred comp deals than they did playing baseball games.  If a team were to suddenly renege on a major deferred compensation deal you’d have to think that the union would scream and the other teams — who might like to convince some of their own high-priced players to take deferred compensation — would scream even louder.  If there’s a chance they’re going to get burnt, why would any player take such a deal again?

As is the case with the Tom Hicks creditors, I can’t help but think that there is a side deal to pay Mr. Rodriguez what he is owed, be it from the Rangers or some other source.* Otherwise, the team and the league will have just created a big labor headache that no one needs.

*How that is specifically being done — if indeed it is being done — is a pretty interesting question, because I think it’s unprecedented in baseball history.  The most recent parallel I can think of is Mario Lemieux, who was owed so much in deferred compensation that he just up and converted all that debt into an equity stake with the Penguins and now owns the team.  That can’t happen with A-Rod because baseball prohibits players from doing such a thing.  Seems like it would have to be a cash thing.

Jacob deGrom outduels Clayton Kershaw, Mets take 1-0 NLDS lead

Jacob de Grom
AP Photo/Kathy Willens

Jacob deGrom put together one of the best post-season starts in Mets history, outdueling three-time Cy Young Award winner Clayton Kershaw to pitch his team into a 1-0 NLDS lead. The right-hander fanned 13 over seven shutout innings, holding the Dodgers to five hits and a walk as the Mets won 3-1.

deGrom’s game score of 79 is the fifth-best by a Mets starter in the playoffs, behind Jon Matlack, Mike Hampton, Bobby Jones, and Tom Seaver, according to Baseball Reference. As Katie Sharp notes on Twitter, deGrom is one of three pitchers to hold the opposition scoreless on 13 or more strikeouts and one or fewer walks. The other two are Tim Lincecum and Mike Scott.

In the eighth inning, reliever Tyler Clippard allowed a one-out double to Howie Kendrick followed by an RBI single to Adrian Gonzalez as the Dodgers finally got on the board. Closer Jeurys Familia entered and recorded the final out of the eighth inning by inducing a weak line out from Justin Turner. In the ninth, Familia worked a 1-2-3 frame to wrap up the game.

Kershaw remains winless in the post-season since Game 1 of the 2013 NLDS, a span of seven starts. He gave up a solo home run to Daniel Murphy in the fourth inning, then walked the bases loaded in the seventh inning before departing with two outs. Reliever Pedro Baez entered and allowed two of his inherited runners to score when David Wright lined a single to center field. On the evening, Kershaw was on the hook for three runs on four hits and four walks with 11 strikeouts. Though he lost his command a bit towards the end of his start, the lefty pitched quite well and will be on the receiving end of some unnecessary criticism as a result of taking another post-season loss.

deGrom and Kershaw both struck out 11 batters, the first time that has happened in a major league post-season game.

Michael Cuddyer didn’t look too good out in left field for the Mets.

Game 2 of the NLDS will continue on Saturday at 9:00 PM EDT. Noah Syndergaard will start for the Mets opposite Zack Greinke of the Dodgers.

Clayton Kershaw, Jacob deGrom create MLB first with 11 strikeouts each in the playoffs

Jacob deGrom
AP Photo/Alex Brandon

For the first time in major league history, both pitchers in a playoff game have struck out at least 11 batters, per’s Paul Casella. Mets starter Jacob deGrom has pitched just a hair better than Dodgers starter Clayton Kershaw overall. deGrom has blanked the Dodgers over six frames on five hits and a walk. Kershaw made one mistake, resulting in a solo home run to Daniel Murphy in the fourth inning. He’s allowed four hits and four walks total in 6 2/3 innings.

The last time opposing starters each struck out 10 in a post-season game was back in 1944 in Game 5 of the World Series when Mort Cooper of the St. Louis Cardinals struck out 12 and Denny Galehouse of the St. Louis Browns struck out 10.

Michael Cuddyer not shining in left field early in NLDS Game 1

Michael Cuddyer
AP Photo/Kathy Kmonicek

Mets outfielder Michael Cuddyer has already made a pair of mistakes in left field and he’s only four innings into the first game of the best-of-five NLDS against the Dodgers.

Leading off the second inning, Justin Turner sent a well-struck liner to Cuddyer which was quite catchable, but the ball clanked off of the veteran’s glove. Turner was credited with a double. Mets starter Jacob deGrom was able to work around the misplay, striking out Andre Ethier, A.J. Ellis, and Clayton Kershaw to close out the frame.

With two outs in the third inning, Corey Seager sent a fly ball down the left field line. Cuddyer took an inefficient route and the ball bounced about a foot inside the foul line, then into the stands, giving Seager a ground-rule double. To add insult to injury, Cuddyer ended up tumbling over the fence. deGrom, again, worked around Cuddyer’s mistake, striking out Adrian Gonzalez to end the inning.

Because he bats right-handed, Cuddyer got the start in left field over the left-handed-hitting rookie Michael Conforto against Kershaw, a southpaw. Conforto mustered only a .481 OPS against lefties this season compared to Cuddyer’s .698. Despite the batting disparity, one wonders how short a leash manager Terry Collins has on Cuddyer given his defense.