Tuesday, November 10, 2009

Jamie speaks.

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 Simers:
Sat down with the Screaming Meanie on Tuesday morning, and how about that, even cutting into Jamie McCourt's negotiated swimming time.
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Perhaps unaware he would open his column with multiple shots at her, Jamie McCourt offered T.J. Simers an extended interview on a wide variety of topics. I'm sure you'll get excellent blow-by-blows elsewhere, so I'll stick to what I know: the divorce.  Jamie's relevant quotes, and my quick thoughts:


  • "I'm a baseball girl. Frank likes the real estate side."

    • Smart strategy here by Jamie, implying many times throughout the interview that she's vital to the baseball operations side of the club. She also throws Frank under the bus on the extravagance of the couple's homes, again saying he's the real estate guy. She also uses this set-up to blame Frank for parking pass price increases at the Stadium.
    • Of course, when it really came down to it, she signed away the baseball team, and he gave her the real estate. That sort of contradiction eats into her credibility a little bit here.
  • "Let's remember it's how we lived and not how I lived . . . . [Jamie's demand for so much money was] something that had to be done at the time."

    • Jamie has an excellent point--because she is in the position of asking for money, it appears like she's the only one living the extravagant lifestyle. It was how the married couple lived, and she's simply asking for that to remain available to her.
    • As we've discussed, she's right on. She has no chance of getting a dime (or a benefit, perquisite, or emolument) that she doesn't ask for up front. I don't fault her strategy here, and I hope that however you feel about her lifestyle, you recognize that to ask for less right now would be foolish.
  • "My dream would be to have a coalition of people [owning the Dodgers]. . . . I don't need to be the controlling interest, I just love baseball that much and want to stay a part of it and lend my expertise any way I can."

    • I gotta say, my alarm bells are ringing like crazy right now. To me, that quote says she knows she doesn't have the cash to buy out Frank's half (assuming the Dodgers are community property). If there's a silent minority out there hoping Jamie ends up with the team...well, those hopes take a big blow if that quote means what I think it means.
  • "I met Frank when I was 17, dated him for eight years and was married to him almost 30 years. . . . I trusted the man." 

    • Here, she was explaining why she signed the post-nup without raising concerns as to its effect. As we'll talk about tomorrow (sneak preview!), she might be in deep trouble if Frank's preliminary assertions are right.
I encourage you all to read Simers' account in its entirety. Like his style or not, we certainly need to be thankful for his reporting. There's some great stuff in the interview about ticket prices, payroll, and even Jamie's relationship with her bodyguard/driver/lover Jeff Fuller. The quotes above offer significant insight into how the divorce proceedings will move forward and provide background about the coming battle for the Dodgers.


Thanks to an intrepid reader, we have more original documents to talk about tomorrow. See you then.
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Posted by Josh Fisher at 8:24 PM
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7 comments:

  1. A big problem with Jamie trying to find investors is that there are going to be few who are going to put up millions of dollars, and get so little in return. Baseball is a labor intensive business, from player's payroll to stadium staff.

    Given how the McCourts also leveraged everything that wasn't bolted down, any investors are going to question why their money is going to pay off bank loans to buy the team in 2004, instead of coming back to them in small returns from the tiny profit.

    Also, how the McCourts have run the team, I doubt they are going to be allowed either Frank or Jamie to run it, or use the money to open credit lines for Jamie or Frank's lifestyles.
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  2. I thought in terms of the case, when she said she signed both her declaration in her dissolution petition and also the post-nup agreement without full review and understanding, those two things undermine her case.
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  3. Question-- how much of their lavish lifestyle was funded by credit? Their take-home from the Dodgers wasn't enough to live the way they were living, and the other businesses appear to be moribund or defunct.
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  4. One point in the Simers interview nags at me, where Jamie portrays herself as the lover of baseball and Frank as "the real estate guy."

    Let's take that at face value for the time being, and pursuant to yesterday's Cuban rumors, allow me to engage in some wild-ass speculation for a moment.

    I wonder: what exactly are the covenants and restrictions regarding development of the Chavez Ravine property? As I understand the situation from your excellent previous posts, most of the new debt that the McCourts have taken out over the 6 years of their ownership encumber the land, not the ballclub. Thus, is it possible that either party, winding up in control of the Dodgers post-divorce, could try to hold the franchise by liquidating the real estate for development, and lobbying for a new stadium?

    We are really talking about two civic treasures here, the Dodgers ball club and Dodger Stadium, the fate of both I will be following closely.

    Thanks again for your excellent analysis.
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  5. John--

    The terms of the private placement require the Dodgers to stay in Dodger Stadium through at least 2030. Of course, those same terms require control of the team not to change, so the whole thing might go away if a new ownership group has to buy out that financing.
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  6. In response to Alex's question on how much of the McCourt's lifestyle was funded by credit..

    My guesstimate is alot of it.

    The Real Estate business is known for wheeling and dealing, buying properties all leveraged to the hilt. Hoping that income will cover the monthly payments. The McCourts were probably opening lines of credit with their properties and the Dodgers as collateral.

    One sign of some of McCourts' habits is their South Boston property had $53 million of loans that weren't disclose to Fox Sports/News Corp when they foreclosed on it in 2006. Most of their New England residential properties are listed, and I doubt they are sitting idly, they are probably used as collateral for more loans and credit lines.

    Baseball is a business with high overhead and low profit margins. One reason that many baseball owners have other revenue streams or are successful in other businesses, so they can cover down years The McCourts went into a risky business with huge loans to pay off. The first thing they did when they bought the Dodgers was double down on some loans like the 5.66% interest rate on a $250 million/25 year loan which is AAA bonded, so the McCourts have to pay around $25 million a year on this loan alone.

    What is seems to come out if the divorce/separation started with getting a new post nup agreement, and there should be a strong financial reason while there a new post nup agreement was needed..
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  7. Okojo--

    Great, great point about the surprise debt encumbering the Boston land. You're on fire lately!
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