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|Jamie and Frank McCourt's divorce is taking its toll on the Dodgers franchise.|
This story appears in the July 26 issue of ESPN The Magazine.
She knows it was a Wednesday last October. She knows it was 10:55 a.m. But for all the Dodger Dogs in Chavez Ravine, Jamie McCourt can't recall where she was when she opened the most important e-mail of her life, because her world went blank. As she scrolled down her BlackBerry, Jamie thought she might be sick. It had taken almost 30 years for Jamie and her husband, Frank, to build a billion-dollar empire -- a nest egg that included seven homes and the Los Angeles Dodgers -- but it took only five paragraphs to destroy it.
On the surface, the e-mail -- a letter scanned and forwarded by her attorney -- was a formal but fairly routine termination notice from an owner of a sports team to a CEO for whom he no longer had use. But buried beneath the instructions for how said CEO might clean out her office was the subtext of a family in shambles, a husband firing a wife, a father canning the mother of his four sons.
"There was a saying in the front office that the three worst days of our jobs would be when Vin Scully died, when Tommy Lasorda died and when the McCourts decided to split," said one Dodgers official. "There was never any question it was gonna go lethal."
In the 405-word electronic missive that began "Dear Jamie," she read Frank's reasons for her removal as CEO of the Dodgers, a job that made her the highest-ranking female exec in baseball. They included insubordination, a failure to follow procedure and inappropriate behavior with regard to a direct subordinate (an allusion that she was allegedly sleeping with Jeff Fuller, whom the Dodgers had hired to protect Jamie and ferry her around town). Ironically, of all the perks the McCourts enjoyed as black-card-carrying members of the LA nouveaux riches, a driver for Jamie was the most legit. Shortly after the couple moved to LA from Boston to take over the Dodgers, in 2004, Jamie had nearly lost her right eye from a bacterial infection contracted while swimming. Jamie had sought traditional medical treatment -- and also employed a Russian healer named Vladimir Shpunt -- but could no longer drive at night. Now Frank was, allegedly, a cuckold because of it.
But Frank and Jamie had known their marriage was rocky long before her need for a driver. The two barely resembled the couple that, just six years ago, promised to rescue the Dodgers from the corporate clutches of Rupert Murdoch and return them to family ownership, reminiscent of the glory days when the O'Malley clan ran the show. No, these McCourts had been estranged since July 2009, when they took separate vacations -- she to France with Fuller as her driver, he to the family's estate on Cape Cod -- and found they didn't miss each other. They attended counseling later that month, but it didn't stick. Now they were gearing up to take their bitter private drama excruciatingly public.
Hours before the Phillies flushed the Dodgers from the National League championship series in five games last October, Frank had the termination letter hand-delivered to Jamie's attorney, Dennis Wasser. Earlier, the couple had made a handshake agreement to put off any war over their estimated $1.2 billion fortune until after the season. But with the Dodgers only one loss from elimination, Frank knew that Jamie could file for divorce in LA Superior Court the following morning, before he had a chance to fire her. And because judges tend to preserve the status quo while lawyers settle who gets the toaster, the china and the baseball team, he could be forced to work an entire off-season with a woman he could no longer stand. Unless he fired her immediately. Plus, not cutting her loose would put her in a stronger position for a takeover attempt; Frank couldn't risk it. Jamie responded to her dismissal by filing for divorce on Oct. 27.
Today, what began as boardroom and bedroom bickering has become tabloid fodder in LA. Details of their spat, once the domain of baseball blogs and Twitter feeds, now rival the latest nuttiness from Lindsay Lohan and Mel Gibson for splashy headlines in the Los Angeles Times. The McCourts came to Hollywood expecting star treatment. They just didn't expect to star in a reality show about their crumbling marriage. Once the divorce trial begins, on Aug. 30, sordid details of their troubles will likely be aired coast-to-coast.
To report this story over the course of two months, The Magazine reviewed several thousand pages of court documents and interviewed dozens of people close to the team and couple, including lawyers for Frank and Jamie. Not one source was surprised when the split was announced. "They hated each other from the moment they set foot in Los Angeles," says a former high-ranking Dodgers official. "There was a saying in the front office that the three worst days of our jobs would be when Vin Scully died, when Tommy Lasorda died and when the McCourts decided to split. There was never any question it was gonna go lethal."
And depending on the trial, millions of Dodgers fans could be collateral damage.
On Nov. 3, 1979, Jamie Luskin married Frank McCourt in a quiet ceremony in their apartment on East 52nd Street in Manhattan, where a rabbi played piano to entertain guests. Frank showed up late, without the ring. It wasn't long before the couple moved to Boston, where two years earlier Frank had bought an abandoned waterfront railroad yard. He promised Jamie they would live in Boston for only a year or so, but one year became many as Frank tried to wring profit from the land, which he had turned into a parking lot.
It wasn't easy. Frank spent the next 17 years in litigation over the waterfront property, trying to clear the way for even bigger plans: a retail and residential complex meant to ensure the family's fortunes for generations. He settled for parking spaces. "To understand who Frank is you have to realize he's not a developer, he's a litigator," says a former business associate who spoke on condition of anonymity, fearful Frank might sue him.
|Frank and Jamie met at Georgetown in the 1970's.|
The McCourts have come a long way from those early days when Jamie had to lend Frank $1,000 to start his development company, which became the McCourt Group. In 2004, Frank used that Boston parking lot to buy the Dodgers from Murdoch's News Corp., which was losing an estimated $30 million to $60 million a year on the team and was desperate to sell. McCourt secured a staggering $421 million in loans to make the deal, including one for $200 million from News Corp. itself, using the parking lot, then worth $125 million, as collateral. When McCourt failed to fully repay the loan by 2006, News Corp. took the property and resold it for $203.7 million.
Since moving west, the McCourts have been on quite the home-buying spree. In the past six years, they acquired four houses -- palaces, really -- within 10 miles of each other in the thick of US Weekly's Los Angeles. First, they plunked down $20 million for music producer Kenneth "Babyface" Edmonds' 15,000-square-foot, four-bedroom, 10-bathroom home on Charing Cross Road in Beverly Hills.
Despite the shortage of bedrooms, that location must have been popular with the couple's four boys, Drew, Travis, Casey and Gavin, who were 22, 20, 17 and 13 at the time. The house was across the street from the Playboy Mansion. When a house next door went on the market for a modest $6.5 million weeks later, the McCourts snapped that up to be used as an 8,400-square-foot guesthouse and headquarters of the McCourt Group. Three years later, they paid Courteney Cox and David Arquette $27 million for their Malibu beachfront home designed by architect John Lautner, a Frank Lloyd Wright disciple. Frank loved that home so much he changed his e-mail handle to "Malibu." When the McCourts later realized that the property wasn't big enough for a pool suitable for Jamie's mile-and-a-half morning swim regimen (her e-mail handle: swimmer), they spent another $19 million for the place next door. Which explains, in an odd sort of way, why Jamie can't remember where she was the moment she learned her husband had fired her. She was alone in her home, yes, but which one? It was hard to keep them straight.
Since the couple separated last July, Jamie has lived in the Lautner house (referred to in divorce documents as Malibu #1), so she most likely read the e-mail there. But it's possible she checked her BlackBerry from Charing Cross #1 if she went to use its indoor lap pool that morning. She had secured custody of the pool from 6 a.m. to 2 p.m. Frank was still with the Dodgers in Philly, so there would have been no repeat of the alleged incident a month earlier trumpeted by the website TMZ.
According to Frank's lawyer, Jamie went for a dip in the company of Fuller -- whose job title with the Dodgers, in a Shakespearean twist, was director of protocol -- and Frank came to the house. Jamie called 911, telling police that Frank's presence was threatening (Frank, unaware of the 911 call, left before authorities arrived, and denied the allegation). Jamie's counsel, in turn, denied that Fuller was even there that morning. Frank lived at the Montage Beverly Hills hotel, a couple of blocks down the road (at a cost of $30,000 a month).
Why was Frank at the Montage? Because Jamie had sole possession of the houses, as stipulated in a marital property agreement the couple had signed in 2004. That MPA is at the heart of their fight. Frank was so leveraged financially when he bought the team from Murdoch that Jamie became concerned that creditors would seize their homes should he ever default on the loans he obtained to complete the sale. To protect their nest egg, they drafted a post-nup that transferred all current and future residential property to Jamie. That was good news for her. The bad news? Jamie, who used to practice family law and has an MBA from MIT, may not have read the fine print. Jamie gets the houses, but Frank gets the Dodgers.
To many estranged wives, the real estate might be enough. In addition to the LA cribs, Jamie has in her name a condo in Vail (bought for $6 million), a lot in Cabo San Lucas ($4.6 million), a place at the exclusive Yellowstone Club in Montana ($7.7 million) and that 100-acre Cape Cod estate, now on the market for $50 million and awaiting what Jamie calls in divorce papers "a very special buyer." How serious were the McCourts about their living arrangements? After selling their Brookline, Mass., home to Red Sox owner John Henry, they spent $180,000 to move the kitchen to Charing Cross #1 because they found out Henry planned to raze the joint. In total, the McCourts have spent $14 million improving that residence, adding the indoor pool, a dance studio and a massage room.
That a man who made his bones in real estate would willingly give up so much valuable property is a head-scratcher, until one considers that the Dodgers are worth $727 million, according to a 2010 Forbes estimate.
Jamie, who spoke to The Magazine in early July, says she had no idea she was signing away the ball club: "If someone had said to me, Oh, by the way, you're not going to have the Dodgers or the other assets you've worked your whole life for -- is that okay with you? Believe me, not only would that not be okay, I would remember if someone had said that to me."
Frank declined repeated requests for interviews, but his lawyers say Jamie gambled on real estate because she thought it was a better bet than a sports team. And now that the property market has soured and the team is making money, Jamie wants to unsign. That's their reasoning, anyway. As Frank's attorney Marshall Grossman told the Los Angeles Times: "Jamie McCourt saying she didn't understand [the MPA] is like John Hancock saying he didn't understand the Declaration of Independence when he signed it."
Their legal arms race will cost the McCourts an estimated $19 million, the fees (as high as $1,100 per hour) for some of the hottest trial lawyers in the country. When all the fees are tallied, experts predict that McCourt v. McCourt could be the most expensive divorce in California history. Jamie's counsel, David Boies, will square off against Frank's attorney, Stephen Susman. They have already faced each other in court twice (and are 1-1). Strangely, they are partners on another case, a class-action suit on behalf of commercial fishermen in the Gulf.
Boies has four reasons to believe the MPA will be overturned. Susman has an answer for each.
"First off, I don't even believe it exists," Boies says of the MPA. "Or at least not the piece of paper they claim to have saying Jamie signed away the Dodgers." Boies contends Frank pulled a switcheroo on his wife, that the document he had her sign just before the couple decamped for Los Angeles didn't mention the Dodgers.
According to Boies, the two schedules (listing his take and her take) tacked to the end of agreement (following the signature page) were switched after she signed. Susman says: nonsense. He's getting a forensics expert to verify that the original staples are still in place on the original document.
Boies will also argue that California law states a marital property agreement cannot be conditional, and since it was signed in Massachusetts (which is not a community property state) it is not valid in California (which is, meaning all assets acquired in a marriage belong equally to both spouses). Susman's counter: The document became valid as soon as the McCourts became Golden State residents.
If the validity argument fails, Boies will remind the judge that Jamie didn't have independent counsel; the lawyer who advised her to sign the post-nup was one of her husband's personal attorneys. Susman asserts that Jamie was the driving force behind the post-nup. "Her husband had nearly gone bankrupt three times," says Susman. "She wanted to make sure they would keep the homes if the team wiped Frank out."
In the end, Boies' best hope may be that the Honorable Scott Gordon rules that the MPA creates an unfair division of assets, and that he rips it up. To that, Susman says: "In retrospect, yes, it was a horrible deal for Jamie. But it's fair to say, given the history of Frank's finances, she didn't have much tolerance for risk. This deal gave her security."
Boies, who in March took Jamie and a TMZ crew to Dodger Stadium to retrieve belongings (they were turned away), doesn't mince words when discussing Frank's fiscal strategies. The Dodgers' payroll has dropped from $119 million in 2008 to $95 million this year, raising eyebrows across the league. He echoes frustrated fans -- with an eye to public opinion, no doubt -- who worry that the team is in payroll lockdown until the trial concludes. Says Boies: "Every dollar Frank spends on attorneys to keep Jamie from getting a penny could be spent on starting pitching." Boies says that even if Frank wins on the post-nup, he'll have to pay Jamie a percentage (maybe half) of the Dodgers' appreciation in value -- which is community property -- since the agreement was signed. McCourt paid $431 million for the team in 2004, and the team now could be worth nearly twice that. Given that Frank's lawyers argued he couldn't afford to pay the nearly $1 million per month in temporary spousal support that Jamie requested (he first offered nothing; in May the judge settled on $637,159), he may not be in any position to pay her the hundreds of millions he might owe.
In the six years he's owned the Dodgers, Frank has borrowed an estimated $390 million against the team -- staking future ticket sales -- which he used to live the high life, complete with a private jet ($2 million a year) and a hairstylist who came to the house five days a week ($150,000 a year). The McCourts also spent six figures on Vladimir Shpunt -- the healer who treated Jamie's eye -- asking him to use his "V Energy" to help the team and to "Think Blue" from his home in Massachusetts.
Meanwhile, Frank engaged in a perfectly legal shell game and has not paid a dime in state or federal taxes since 2004. More eyebrows were raised when The New York Times revealed on July 9 that a Dodgers executive had drawn more than $400,000 in salary to run a $1.6 million charitable fund for the Dodgers Dream Foundation. The trial will force open even more of the club's books, bringing even closer scrutiny to the couple's professional and private finances.
While the McCourts were living large, the Dodgers, in 2008 and 2009, spent less than any other MLB team on the draft and international-player signings, an area the team once dominated. Frank told reporters during spring training that the divorce has nothing to do with the payroll; and multiple former club execs say there's truth to the claim. "It was Frank's plan all along to run a team with a payroll of about $80 million," says a former high-ranking club official speaking on condition of anonymity. "His thinking since he bought the team was: 'This isn't the AL East. Why would I spend $150 million to win 98 games when I can spend half that to win 90, if that's all it takes to make the playoffs in our division?' " So while the Dodgers have spent money on free agents such as Andruw Jones, Juan Pierre, Jason Schmidt, Rafael Furcal and Manny Ramirez -- plus Joe Torre, the game's highest-paid manager -- GM Ned Colletti has structured deals creatively, offering fewer years (Furcal, Jones) and deferring payments (Ramirez, Jones).
When asked how the McCourts' divorce is affecting the Dodgers' payroll, Colletti, weary of the question, joked: "You think I can answer that?" He says he's never "heard a number" like $80 million and holds the company line, saying the team would add payroll down the stretch if the right deal presented itself. If the Dodgers were to deal for, say, Cubs lefty Ted Lilly at the July 31 trade deadline, Lilly would be owed just $4 million for the rest of 2010, or roughly one-fifth of what McCourt will pay to divorce attorneys this year. "For the life of me, I cannot figure out why he hasn't just settled," says another former executive. "It's like he's lost his mind."
Frank McCourt would rather this story be about his accomplishments as owner of the Dodgers, and he has a point. His team has been to the playoffs four times in his six-year tenure, after making just two postseasons in the prior 15 years. It advanced to the NLCS two straight years after not winning a playoff series for two decades. His Dodgers have broken club attendance records. Why, friends say Frank wonders, does the LA press abuse him?
Maybe it's because the Dodgers were his third choice. He lost a bid to buy his hometown Red Sox in 2001, in part because the community balked at his plans to move the team from Fenway Park to a proposed stadium on his lot. "No one wanted to work with him," says a former Dodgers executive familiar with the negotiations. Frank next went after the Angels, but MLB commissioner Bud Selig was said to be keen on having Hispanic-American Arte Moreno join baseball's lily-white owners' club. And Disney, which was selling the team, was happy with Moreno's ability to write a check. "Would you take a parking lot over cash?" the source says.
|Frank made Ned Colletti and Scott Boras happy with a deal for Ramirez.|
It's not as if the media started giving Frank a hard time only after his marriage fell apart and details of his expenses trickled out. The criticism dates to Day 1 in LA, when McCourt showed up to his first press conference at Dodger Stadium, face full of makeup, and stammered through prepared remarks that he handed out to reporters. "It looked like he was running for president of the Dodgers, not announcing he just bought the team," says a former employee who attended the ceremony. It didn't help public trust when the Los Angeles Times reported that Frank had bought the team with those heavy loans and almost no money down.
That led to speculation in the press that Frank had purchased the team only for the real estate that came with it. Dodger Stadium sits on one of the most valuable pieces of property in sports, and he'd never even set foot in it before buying the team. Whispers that Frank was planning to level the city treasure to develop the surrounding 276 acres rose to a roar when it was revealed that the Dodgers were losing so much money. Why, people wondered, would a real estate maven buy a baseball team bleeding cash if not for the potential billions he could make by developing the land? But McCourt has said he never considered razing the stadium. "He took a look at those books and knew he could turn a profit within three years," says a former executive who was part of McCourt's transition team. "Fox was the worst owner in the history of baseball. They inflated their losses with accounting tricks. They were hemorrhaging money on the most ridiculous things you could imagine, from terrible gardening deals to the way the yearbook was published to the soda distributor. It wasn't rocket science to turn it around."
And the McCourts did almost double the team's value. But at what cost? Dodger Stadium had become a battlefield. Last September, Jamie filed a formal complaint with the team citing workplace harassment. Although CEO, Jamie claims Frank's staff told Dodgers employees to stop speaking to her. Jamie argues that she was more than a figurehead executive or owner's wife content to sit in the luxury box. In court filings, she contends she sat in on weekly owners' conference calls with Selig. She also says she regularly led meetings with other Dodgers execs and was involved in discussions on everything from ticket prices to Yoga Day with Andre Ethier.
Maybe so, but her role with the team was confusing. Jamie started as vice chairman, became team president in 2005 and CEO in March 2009. "We rewrote her bio for the 2005 media guide 20 times," says a former Dodgers executive. "There was a daily fight over what her title was."
Whatever was on her business card, Jamie clearly had an agenda that went far beyond taking over the Dodgers. In 2007, the McCourts hired PR guru Charles Steinberg, who is credited with revamping the Red Sox fan experience at Fenway, to do the same with the Dodgers. But within a year, Steinberg had aligned himself with Jamie, bringing in people from Boston and inserting them in every department. "It was a giant mess, because you had a Jamie person and a Frank person doing the same job," says a current Dodgers employee. "And as things got tenser, it was like they were each using moles to spy on each other."
|A year after the Dodgers signed Ramirez, Jamie made a pitch at the LA courthouse.|
Steinberg went so far as to unveil "Project Jamie," a seven-page action plan with a goal to make her president of the United States, with support from a coalition of "women, minorities, Hollywood types, and sports-loving males." Frank had seen enough of the Jamie Show. Steinberg was fired last September; his people were out by Christmas.
Project Jamie came to light in court proceedings connected to the divorce, which in general has been a wellspring of joyous discovery for the local media, celebrity voyeurs and anyone else curious about the foibles of the rich and famous. Frank, for example, once harbored desires to build an NFL stadium -- project code name Gorilla -- adjacent to Dodger Stadium. Trying to secure Chinese investors for the project, as well as financing for a stake in a Premiership soccer team, Frank wrote a plan to double Dodger ticket prices over the next eight years while lowering payroll. None of this would be known had Jamie's side not revealed Frank's scheme through court papers.
In any event, after Jamie got the termination e-mail, Frank had the locks to her office changed and canceled her Dodgers Amex card. Her health insurance was cut off, and she had to go on Cobra. Frank was just getting started. He axed dozens of Dodgers employees seen as Jamie loyalists, from ticket salespeople to in-game entertainment producers. "At the Christmas party last fall I found out 40 people had been fired, 35 of whom probably did not deserve to go," says a current Dodgers employee speaking on the condition of anonymity for fear he might be next. "But you could kind of see why he did it because it seemed like the queen was amassing an army for a possible takeover." Still, another current Dodgers exec says the housecleaning may have been Frank's biggest mistake, creating a legion of "pissed-off ex-employees."
Steinberg is now senior adviser of public affairs for MLB commissioner Bud Selig.
The point of no return in this real-life War of the Roses may have been crossed in August 2008, when Jamie tried to get Frank to sign a revised version of the MPA, giving her co-ownership of the team. Frank stalled through the fall and winter. On May 13, unaware that Frank had sent her an e-mail the day before saying he would not change the MPA, Jamie sent him a last-ditch e-mail to resolve the fight over the team. It read:
"We should both remember that we've been life partners for nearly 40 years. We have been enormously fortunate with our love, our health, our children and our success together. I would really like to get this annoying estate work behind us for a variety of reasons. It's pretty unclear to me why you've canceled yet another meeting with [our estate attorneys] to tie this up in a bow. What about this am I missing, because it really makes me feel that you don't care about me? If we come through this troubling time in our lives we should think about renewing our vows ... I love you."
Frank refused to waver from his position. He said in filings that he was just protecting his and the family's interests, that at the same time she was asking him to sign over half the Dodgers she was consulting divorce attorneys behind his back and cheating on him with Fuller. Not helping her case on the fidelity front, claim Frank's lawyers, Jamie went with Fuller on a two-and-a-half-week trip, first to Israel on business for a baseball tournament, then to France -- all on the Dodgers' dime. When she returned, she moved from the Charing Cross house to Malibu. (Jamie refuses to say whether she and Fuller are together.)
Despite continued legal wrangling, stubbornness and general mistrust, the McCourts, according to those who see them daily, both seem more sad than angry these days. One current Dodgers exec and confidant of Frank's says, "People think he hates her, but he never trashes her to us. He's more sad than anything else." And Jamie expresses grief, at least for one former love: "I miss the Dodgers more than anything in the world."
Always involved and engaged parents, Frank and Jamie put aside differences for one day to sit together as son Casey graduated from Stanford this past June. But their lingering sadness and momentary détente will be forgotten when the divorce goes to trial, Aug. 30. And while both sides hope to get their way, it's likely neither will. Frank wants his position as sole owner to be upheld by the judge and for Jamie to walk away with just the houses. He wants to own the Dodgers, then pass the team on to his beloved sons. If he has to give Jamie a chunk of the team, he'll be even more financially strapped than he is now -- just as stars such as Matt Kemp, Andre Ethier, Chad Billingsley and Jonathan Broxton hit free agency.
Jamie, who set up offices for Jamie Enterprises 500 feet from Frank's refuge at the Montage hotel, wants to be reinstated as co-owner. Her lawyers suggested to the Los Angeles Times that she's in a position to buy Frank out, but after the drama the couple has put Major League Baseball through, it's unlikely she'd get the necessary approval from other owners. Boies says Frank can buy Jamie out with a back-loaded deal, paying some now and a lot later if he realizes a potential windfall. As it turns out, Fox's TV deal with the Dodgers ends in 2013, and McCourt can start a network that could be worth billions. No surprise, Frank has tapped Susman to ensure that Jamie sees none of that loot.
For now, the games go on and the players try not to pay attention to the turmoil upstairs.
"We don't really worry about all that stuff," says catcher Russell Martin.
"It doesn't really affect me at all," says second baseman Blake DeWitt.
Adds former Dodgers and current Rockies reliever Joe Beimel: "An owner is your employer, so you pretty much just take your paycheck and play. I rarely interacted with the McCourts. They liked to sit in the front row behind home plate and be on TV, but they don't meddle in the clubhouse."
At least Joe Torre has that going for him. Late last month, after closer Broxton blew a four-run lead against the Yankees, Torre sat at his desk in Dodger Stadium, still in uniform, looking very tired. Reflecting on his 12 years in New York, Torre said he left mainly because "the stress got to me. The scrutiny was never-ending." When asked how handling questions from the New York media about why his Yankees teams couldn't win 162 games every year compared with handling questions about divorces, frozen payrolls and Russian healers, Torre said: "It's the same stress, really. The difference is out here it's coming from only one paper."
Torre denies reports that he's tired of the McCourts' drama and frustrated that he doesn't have the war chest he enjoyed in New York. Those same reports say he won't be back after his contract expires at the end of the season. Torre says he'll let the team know by September.
Reflecting after that loss to his former team, Torre said: "It's tough to manage in a city where baseball doesn't stay in the sports section, where it spills over into other sections."
As far as anyone could tell, he was referring to New York.
Molly Knight is a contributing writer for ESPN The Magazine.