WILMINGTON, Delaware (Reuters) ? Major League Baseball rejected allegations it caused the Los Angeles Dodgers to end up in bankruptcy and said the Dodgers' owner tried to get $20 million of team money weeks before the Chapter 11 filing.
The league filed court papers Wednesday accusing Dodgers' owner Frank McCourt of improperly using bankruptcy to fight his personal disputes. Major League Baseball has appointed a monitor to run the team.
The team has requested a slew of documents from the league which the team hopes will prove McCourt has been targeted unfairly by Commissioner Bud Selig. A telephone hearing before Delaware bankruptcy Judge Kevin Gross will be held later on Thursday to determine what documents the league must provide.
The Dodgers filed for bankruptcy last month after the league rejected the team's proposed cable television deal with Fox Sports, which would have provided the team with funds to meet payroll.
The team accused the league of causing the cash crunch as part of a covert campaign to oust McCourt, who the league says diverted $100 million of team revenue for his personal use.
McCourt is simultaneously waging a divorce court battle with ex-wife Jamie over ownership of the team.
The Dodgers and the league are fighting in bankruptcy court over financing to keep the team operating. McCourt wants to borrow $150 million from the Highbridge hedge fund unit of JPMorgan Chase & Co.
The league has argued it can provide the loan more cheaply, and with fewer strings attached.
The Dodgers are trying to demonstrate the league is an adversary and the team should not be forced to borrow from MLB.
The league countered that it has taken steps to preserve the image of one of baseball's most storied teams. It also said in the court papers that in April McCourt requested $20 million from the team's funds be distributed to him.
The league said the Dodgers' document requests constitute harassment. It said the Dodgers requested information about loans to the New York Mets from convicted Ponzi scheme operator Bernard Madoff, media rights deals of other teams and league communications with Jamie McCourt and former Dodgers manager Joe Torre.
The league attacked the Dodgers' preferred loan deal with Highbridge, and said that if the court accepted the league loan Frank McCourt would be personally liable for various undisclosed fees to Highbridge.
"Mr. McCourt is conflicted here because it appears that he has a multi-million dollar financial interest in ensuring that the inferior Highbridge (loan) proposal is consummated," the league said in court documents.
An attorney for the Dodgers did not immediately respond to requests for comment.
The case is In re: Los Angeles Dodgers LLC, U.S. Bankruptcy Court, District of Delaware, No. 11-12010.
(Editing by Dave Zimmerman)
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