Postnup, Dodgers at center of case
The couple who tried to restore the Los Angeles Dodgers as a family franchise walked out of a divorce court Wednesday, placing the team’s future in the hands of a judge.
Superior Court Judge Scott Gordon must decide whether a postnuptial marital agreement signed by Jamie and Frank McCourt in 2004 should determine who owns the team, the stadium and the surrounding property, worth hundreds of millions of dollars.
The judge has 90 days to make a ruling on a disputed 10-page document that exists in two versions — one that gives Frank McCourt sole ownership of the Dodgers, and one that doesn’t.
Frank McCourt’s lawyers contended the agreement undeniably gives the team to their client, while Jamie McCourt’s legal team wants the pact thrown out and the couple’s assets divided as community property.
Both McCourts declined to comment after attorneys gave their closing arguments. Attorneys on both sides were more humble than previous days when asked who was winning at trial.
Legal experts believe Gordon has a difficult choice to make.
”I think at this point, the score is pretty even,” said Los Angeles family law attorney Lisa Helfend Meyer. ”This case has so many loose ends, you have to give the benefit of the doubt to (Jamie).”
The 11-day trial provided the public a rare glimpse into the inner workings of a Major League Baseball team. Through testimony and tens of thousands of pages of court documents, observers have learned about the Dodgers’ finances and how the couple’s lavish lifestyle affected the team.
Although both sides gave conflicting accounts of what their intentions were when they signed the agreement, one aspect was abundantly clear: neither of them read it closely enough, even though it spelled out how their assets would be divided in the event of a divorce to prevent the legal fiasco.
Jamie McCourt maintained she was the team’s co-owner and would never have signed away her purported stake in the Dodgers had she know the agreement took it away from her. Frank McCourt countered the pact was his wife’s idea so she could protect her separate property – a group of opulent homes — from his business creditors.
His attorneys said in their closing arguments that Jamie McCourt couldn’t have the houses and still have access to her husband’s property, namely the Dodgers. They also pointed out to Gordon that Jamie McCourt was an astute family law attorney herself and her claim that she didn’t read the agreement before signing it doesn’t hold water.
”To put it plainly: a deal is a deal,” attorney Victoria Cook said in explaining why the marital agreement should be upheld. She later took a shot at Jamie McCourt, saying, ”Justice may be blind, but it doesn’t reward those who refuse to see.”
To complicate matters for the judge, it was discovered shortly before trial began last month that there are two versions of the agreement.
In his closing argument, Jamie McCourt’s attorney Dennis Wasser gave a Power Point presentation that included two sections entitled ”Smoking Guns” and ”Hurdles Frank Cannot Overcome.” In both, Wasser directed his ire at Larry Silverstein, the couple’s attorney who helped draft the postnuptial agreement and supposedly advised them about its effects.
Wasser suggested fraud was committed when one version of the postnuptial agreement was replaced with the other, but he doesn’t believe Frank McCourt instructed Silverstein to do it. ”My theory is he was acting as (Frank McCourt’s) agent,” Wasser said of Silverstein. ”He wasn’t doing it for himself. He wasn’t doing the switch for Jamie.”
Silverstein testified during the trial that he believed he swapped a key portion of the agreement but failed to tell the couple. Frank McCourt denied during testimony that he knew about the switch.
Wasser believes Frank McCourt and Silverstein tailored their testimony after forensic analysts determined a portion of the agreement had been replaced. ”The story that Frank and Mr. Silverstein are giving is reverse engineering,” Wasser said. ”The story is scripted.”
His attorneys also said Jamie McCourt wanted no part in the risk associated with the $430 million purchase of the Dodgers that was mostly funded by short-term loans to be repaid within two years. They pointed out that she didn’t call any witnesses during the trial to corroborate her claim that she was a team owner.
Wasser reiterated Jamie McCourt wouldn’t have signed away her purported stake in the Dodgers.
”You know and everyone in this courtroom knows, and even Frank knows, she would never give up the Dodgers,” Wasser said to the judge. ”It doesn’t make sense.”
The McCourts, armed with a cadre of high-powered lawyers, have met at the negotiating table several times to try to settle the dispute. The most recent session came Friday with no resolution.
They were expected to resume mediation on Oct. 9, according to court spokesman Allan Parachini.
”My best guess is the case will settle after the judge makes a decision,” Wasser said outside of court.
Jamie McCourt was fired in October as the team’s CEO, a job that paid her a $2 million annual salary. She filed for divorce the same month, citing irreconcilable differences. The couple have been married since 1979 and have four grown sons.
Legal observers say the case is nothing short of a colossal mess.
”It’s a debacle,” said J. Michael Kelly, a family law attorney in Santa Monica. ”I find it very hard for the judge to say this is a valid agreement.”