UPDATE #1: Added paragraph dealing with response by Greenberg/Ryan lawyers blasting reconsideration motion.
UPDATE #2: Judge grants hearing for Tuesday, July 20, 2010 at 9:00 a.m. to hear Emergency Joint Motion of Lender Parties for Reconsideration of Court’s Order Adopting Bidding Procedures.
Creditors of the Texas Rangers are seeking an emergency hearing in which they claim the approved bidding procedures for the auction of the Texas Rangers are flawed, and should be reconsidered. The court filing states that, “Discovery has confirmed that the Debtor’s goal in engaging in the Midnight Transfers and filing this bankruptcy case, as stated by Glenn West (then representing multiple Hicks-related entities) to Major League Baseball’s president (among others) in an email.”
The motion adds:
The Bidding Procedures are unfair to the Lender Parties, as they were largely based on the procedures sought by the Debtor and its preferred buyer, (Greenberg/Ryan group), were presented to the Lender Parties and all other parties in interest literally only minutes before they were argued, and were entered without the support of a single word of testimony or single document entered into evidence.
The motion goes on to say that, "The Bidding Procedures serve only the purpose of overlaying the façade of an auction process over a case that has been fundamentally flawed from the beginning.”
The filing states that procedures do not provide sufficient time for potential bidders, such as Jim Crane and Jeff Beck, to be able to participate meaningfully in the sale process and are too skewed to the advantage of Rangers Baseball Express, the group led by Chuck Greenberg and Nolan Ryan – the one party that does not need any added incentive to participate in an auction or any other advantages in the sale process.
The court filing is redacted, thus making critical information surrounding the claimed email, unavailable to the public. In a separate filing, the creditors filed an non-redacted copy of the document, requesting that it remain under court seal, never to be allowed to see the light of day by the public. The “Motion to Allow Lenders Parties to File Under Seal” reads, in part:
[T]he Lender Parties request that the Motion be kept confidential indefinitely. Local District Court Rule 79.4 states that “all sealed documents will be deemed unsealed 60 days after final disposition of a case.” Pursuant to Rule 79.4, the Lender Parties hereby request that the Motion be kept confidential indefinitely and that it not be deemed to be unsealed 60 days after the final disposition of these bankruptcy proceedings.
Early Friday morning, lawyers for the Greenberg/Ryan group blasted the motion in a filing of their own saying, "The Motion for Reconsideration is nothing but a rehash of arguments previously made by the Lender Parties and the Holding Companies, and rejected by the Court, at the hearing on RBE’s request for a temporary restraining order.... For over seven months, RBE has had an agreement to buy the Texas Rangers approximately $500 million. For almost that long the Lender Parties have been saying that there are others who are 'ready, willing and able' to pay more. Talk, however, is cheap; nor does it pay claims against a bankruptcy estate. The time to put up or shut up is here."
Judge Michael Lynn has set an Aug. 4 auction date for the sale of the Rangers. Any qualified bidder wanting to participate in the auction must submit a qualified bid on or before Aug. 3 at 8:00 p.m. (prevailing Central Time).
Bidding at the auction is set to begin with an initial minimum bid that is at least $15,000,000 above the "Stalking Horse Bid" of the Greenberg/Ryan group, which is currently $306.7 million in cash. Bids after that shall subsequently continue in $2,000,000 minimum overbid increments.
The auction does not include a land transaction for approx. 154 acres around Rangers Ballpark at Arlington valued at $75 million reached by the Greenberg/Ryan group.
Any winning bid would need approval from 75 percent of MLB’s owners. The league has backed the Greenberg/Ryan group for months. In the past, MLB has said that the highest bid does not always mean the best owners for the make-up of the ownership brethren of the league. Judge Lynn said that he can determine whether the league acted in good faith in the process, should higher bidder win the auction but be rejected over the Greenberg/Ryan group by MLB's owners.
More news as it becomes available.
Maury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey, as well as a contributor to Forbes SportsMoney blog. He is available for hire or freelance. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network.
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