The McCourts go to court

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For those of you who think that tooth-and-nail competition ended with Victorino’s groundout last night, you couldn’t be more wrong. The McCourts will have the first of what are sure to be many offseason hearings in there divorce battle cum power struggle later today, and unlike some of the stuff that will come later, this one involves the Dodgers pretty prominently.

The absolute go-to website for all of this stuff is Josh Fisher’s Dodger Divorce blog, where he has all of the details as to what will be argued and what will be at stake in today’s hearing and beyond.

While I appreciate that some of you may not care to pay attention to this due to the tawdry and salacious nature of some of the proceedings thus far, there is a larger baseball point to all of it: two highly-leveraged people are fighting over ownership of one of baseball’s marquee teams. The outcome of that battle will almost certainly have a profound impact on the Dodgers’ competitive situation going forward, as well as financial implications for baseball as a whole.

Why? Because if Jamie McCourt wins, and convinces the court that she’s a co-owner, the Dodgers will almost certainly have to be sold in the divorce. At the very least, they will have to be leveraged even more than they already are, thereby choking off cash from the team.  What’s more, such a sale would probably occur under distress conditions — there would be a time frame placed on it — thereby lowering the franchise’s market value. Appreciation in franchise market value, by the way, is the single biggest reason anyone buys a baseball team. If that is negatively impacted, owners will start to behave very differently. Probably by cutting payroll and trying to make their teams a better investment from a cashflow perspective as opposed to merely an arbitrage opportunity.  In short, this is a big deal.

So come for the wild accusations, but stay for the gravitas. Either way, we plan to keep you apprised of all of the happenings in L’affaire McCourt.

Report: Major League Baseball bans transactions with Mexican League teams

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Jeff Passan of Yahoo Sports reports that Major League Baseball has banned all transactions with Liga Mexicana de Beisbol (LMB), popularly known as the Mexican League. As of now, all 30 teams are prohibited from signing players under contract with LMB teams. The ban was issued due to Major League Baseball’s contention that “corruption” and “fraud” run rampant in the player acquisition process.

Passan describes the issues in detail, and they sound pretty compelling. The upshot: LMB clubs — which have full control over their players — are taking advantage of them, taking most if not all of the signing bonuses MLB teams give them after negotiating for their rights. Mexican teams often sign players when they’re 15 years-old so that, once they are old enough for American teams to approach them, they’re in the position to take a usurious cut.

Passan says Major League Baseball is demanding greater transparency from LMB before it’s willing to lift the ban. He also says that the MLBPA is in “lockstep” with Major League Baseball on the matter, which makes sense given that, if MLB’s claims are accurate, players are being exploited here. He also says that if LMB does not change its ways, there is a “Plan B,” though it’s not clear what that is.

There aren’t a ton of Mexican players signed by MLB teams each year, but there are enough to make this a significant issue that is worth watching.