Frank McCourt: Mistake over Dodgers ownership in postnuptial agreement caught at last minuteBy Greg Risling, AP
Wednesday, September 1, 2010
McCourt: Dodgers mistake in postnuptial was caught
LOS ANGELES — Frank McCourt testified Wednesday that a mistake was caught that would have excluded the Los Angeles Dodgers as his separate property in a postnuptial agreement, but he couldn’t remember who first noticed the purported error.
McCourt, 57, said the blunder was discovered the day before he and his estranged wife, Jamie McCourt, signed the document in March 2004, just weeks after buying the Dodgers for about $430 million.
Three drafts of the agreement specifically excluded the team from his separate property, but at some point during a sitdown with a family attorney, the document was changed to include the Dodgers, he testified.
“By the end of that meeting, it was clear that a correction needed to be made,” McCourt said.
But Jamie McCourt’s lawyer David Boies showed McCourt two financial documents in which the couple sought bank loans that listed her as a joint owner of the team.
McCourt and former Dodger CEO Jamie McCourt are locked in a contentious and costly divorce dispute that could decide who owns the team. He contends the postnuptial agreement gives him sole possession of the team, the stadium and the surrounding property, while his wife believes the agreement should be thrown out and those assets should be split evenly under California’s community property law.
Superior Court Judge Scott Gordon will have to decide whether the 10-page agreement is valid. He also could order the sale of the Dodgers.
Frank McCourt’s testimony primarily focused on his recollections of what the agreement was supposed to provide. But he had trouble remembering a number of factors, including whether his wife saw a copy of the postnuptial agreement before they signed it at their Massachusetts home.
Boies showed him documents from the family attorney that indicate he met only with Jamie McCourt that day, suggesting Frank McCourt may not have gone over the agreement with the lawyer before signing it.
“We think he was at the house but not at the meeting,” Boies said outside of court.
McCourt also had problems remembering what transpired before the pact was signed, but said he was certain that the Dodgers were meant to be his and that the couple’s six palatial homes were to belong to his wife.
“I don’t have a present memory if I caught it or (the family attorney) caught it, but he made the change,” McCourt recalled.
Three copies of the agreement list the Dodgers under McCourt’s separate assets and three others that don’t. McCourt’s lawyers have said the one word that was changed was due to a typo, but Jamie McCourt’s legal team claimed her husband and the family attorney engaged in fraud by making the correction without telling their client.
Jamie McCourt’s attorneys also were seeking the monetary value of the Dodgers, its stadium and the surrounding property. In court, Boies showed a financial analysis prepared by McCourt advisers that listed the value of the land around Dodger Stadium as low as $414 million and as high as $828 million.
McCourt’s attorneys said the team and the properties are worth between $800 million and $900 million, while his wife’s lawyers believe the potential could be more than $2 billion. The analysis introduced by Boies included a footnote that said the franchise could general $200 million in revenue.
Jamie McCourt’s team also argued that the couple’s individual assets were not balanced between the two. They believe the postnuptial agreement is invalid because it gives McCourt an unfair and unbalanced amount of assets.
A Major League Baseball application from McCourt buy the Dodgers in 2003 showed his net worth at $240 million. Nearly a year later, McCourt reported his personal fortune had grown to about $380 million.
McCourt believed his wife’s assets, which included the couple’s homes, were roughly $75 million.
During McCourt’s testimony, Boies asked whether McCourt had pointed out to his wife that his assets greatly outweighed hers six years ago. McCourt said he had many conversations with Jamie McCourt about the value of their assets but admitted he never told her to think about making the proportions more balanced.