McCourt Dodgers trial continues

Updated: September 27, 2010, 9:34 PM ET
ESPN.com news services

LOS ANGELES -- Jamie McCourt didn't refer to herself as owner of the Los Angeles Dodgers and told her estranged husband that he shouldn't pursue the team 6 1/2 years ago because the deal was too risky, the team's chief financial officer testified Monday at the couple's divorce trial.

Peter Wilhelm recounted conversations he had with Frank and Jamie McCourt in the months leading to the $430 million acquisition of one of baseball's most storied franchises in 2004.

After conducting a financial analysis that showed the Dodgers were bleeding money under the previous owner, Fox Corp., Jamie McCourt questioned whether the deal was appropriate, Wilhelm said.

"It was all about the riskiness of the deal and if we could contain it," Wilhelm said. "Jamie was making it readily clear that she thought Frank was being too aggressive."

The couple are embroiled in a nasty and costly divorce case that centers on the validity of a postnuptial marital agreement they both signed shortly after buying the Dodgers that gave Frank McCourt the team, the stadium and the surrounding land, worth hundreds of millions of dollars, and provided Jamie McCourt a half-dozen luxurious homes.

Jamie McCourt wants Superior Court Judge Scott Gordon to throw out the agreement, arguing no one told her she was giving up her purported stake in the team. There are also two versions of the agreement, one that gives the Dodgers solely to Frank McCourt, and one that doesn't.

Gordon could order the sale of the team. Closing arguments are set for Wednesday.

Wilhelm's testimony contradicts what Jamie McCourt told Gordon last week when she said she didn't view the Dodgers transaction as risky. Frank McCourt's lawyers have said Jamie McCourt isn't entitled to a slice of the Dodgers because she wasn't willing to take on the danger of possibly going belly up with the new business.

The deal was mostly funded by loans that needed to be paid in two years.

The Dodgers were in sad financial shape prior to the McCourt ownership. Court documents show the team lost nearly $200 million between 2000 and 2003.

Wilhelm also testified that Fox executives told him the new owner would have to field a payroll of $115 million.

"A turnaround was possible with a lot of hard work," he said.

Wilhelm was part of a management team that came up with a business plan that was eventually submitted to Major League Baseball. The proposal called for cutting payroll by 11 percent and 21 percent in 2005 and 2006, respectively, with an operating budget of roughly $85 million. The document was shown earlier in the trial.

Other testimony came from three witnesses who said they understood the couple held their assets separately because Jamie McCourt didn't want to expose the homes to business creditors.

Financial consultant Robert Leib said he worked with the McCourts on bids to buy the Boston Red Sox, Los Angeles Angels, NHL's Anaheim Ducks and Dodgers. Leib recalled Jamie McCourt saying the couple had problems with her husband's creditors before and didn't want that to happen again, adding the pair didn't "have two nickels to rub together."

Baseball consultant James Corey Busch said he was taken aback when Jamie McCourt suddenly made a comment at a meeting prior to the purchase of the Dodgers about the way the couple divided their assets. Busch said she "wanted to be separate from the [Dodgers] deal."

One claim noticeably absent from the trial has been the allegation made by Frank McCourt in court documents that his wife was having an affair with her driver-bodyguard.

Busch broached the subject when asked by one of her attorneys why he sent Frank McCourt an e-mail last November pledging support to him but didn't make the same offer to Jamie McCourt. Busch said he decided to reach out to Frank McCourt because he had heard about the alleged affair.

"I felt sad for Mr. McCourt and his sons," Busch said.

Jamie McCourt, wearing a powder blue outfit, scoffed at Busch's comments. Outside court, her attorney Dennis Wasser called the mention of the affair a "cheap shot."

In afternoon testimony, Jeffrey Ingram, a chief operating officer of one of Frank McCourt's companies, said his boss typically was asset-rich and cash-poor. In a January 2001 e-mail, Ingram told the couple it would be six to eight months before they ran out of cash.

While Ingram said money was eventually found, the couple continued to have liquidity issues. He said Frank McCourt was more concerned with creating value for his businesses than drumming up money, and Jamie McCourt was more interested in keeping the houses away from her husband's liabilities.

"Jamie was interested in having a nest egg and getting cash into the family and into her account," Ingram said.

Frank and Jamie McCourt were back in court Monday after settlement talks stalled Friday.

Lawyers for both McCourts confirmed that a mediation session held late last week behind closed doors failed to bring a resolution in the couple's bitter battle over ownership of the Dodgers.

The Los Angeles Times reported Monday morning that Frank McCourt has offered his estranged wife roughly $100 million and that Jamie McCourt is seeking four times that amount. When asked to comment on those numbers Monday afternoon in front of a group of reporters, an attorney for Jamie McCourt responded flatly with: "They're wrong."

Last week's proceedings were highlighted by the testimony of lawyer Larry Silverstein, who has admitted that he replaced the schedule that excluded the Dodgers from Frank McCourt's separate property with a schedule that gave him sole control of the team. He said that he believed he was correcting a typo. Attorneys for Jamie McCourt argue that Mr. Silverstein's actions were unethical because neither party was informed of the switch.

Closing arguments in the case are expected to be delivered on Wednesday. The judge then has 90 days to render a verdict.

Information from ESPN The Magazine's Molly Knight and The Associated Press contributed to this report.

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