Smoking Gun in the McCourt's Divorce Trial

by John M. Curtis
(310) 204-8700

Copyright Septembre 22, 2010
All Rights Reserved.                                

              Giving Major League Baseball a black eye, the ugly divorce trial of Jamie and Frank McCourt battled for ownership of the Los Angeles Dodgers.  Since the divorce trial began Aug. 30, the McCourts continue to air more dirty laundry, prompting former Dodger owner Peter O’Malley, son of original owner Walter O’Mally, to demand the team be sold to the highest bidder.  O’Malley, who sold the Dodgers to Fox Entertainment Group Sept. 5, 1997 for $350 million, should go back to the sidelines, since he had little regard for the team’s ownership.  While the McCourt’s dispute sullies one of sports most coveted franchises, O’Malley lost his right to criticize when he unloaded the team in 1997 to Rupert Murdoch.  Recent revelations about how Frank’s Boston attorney Larry Silverstein altered a postnuptial agreement now make Frank’s ownership claims untenable. 

            Under withering cross-examination from Jamie’s attorney David Boies, Silvertein admitted to altering a version of the postnuptial agreement to assure his client Frank sole and separate ownership of the Dodgers.  Jamie signed an agreement that left the ownership as part of the couple’s community property.  Calling the change to the agreement a “drafting error,” Silverstein was hard-pressed to explain it to Superior Court Judge Scott Gordon   Silverstein originally omitted the Dodgers, stadium and surrounding property from Frank’s side of the ledger.  Jamie signed all six copies of the agreement in  2004, three that included Frank’s exclusive ownership and three that did not.  “I was simply trying to have a set of protective documents,” said Silverstein under oath, trying to explain how he could of left his client, in the original three agreements, so financially exposed.

            Silverstein’s explanations lack plausible deniability and stretch credulity to the breaking point.  His original error, omitting Frank from exclusive Dodger ownership, potentially exposes him to a liability at least 50% of the team’s market value, now estimated at around $1 to $1.4 billion.  When he bought the franchise in 2004 from Murdoch’s New Corp. for $430 million, no one expected the whopping increase in value.  Silverstein’s error, and now discovery of an altered postnuptial agreement, could cost Frank about $700 million.  Boies asked Silverstein in court whether it was OK for an attorney to alter a legal document without consent of both parties.  “In certain circumstances, yes,” replied Silverstein, handing Jamie the smoking gun needed to go back to arbitration.  With Silverstein’s admission, Frank’s attorney, Steve Susman, got that sinking feeling.

            When Boies asked Silverstein, who’s practiced law for 30 years, whether he’d ever seen an agreement altered from a legal document without permission of both parties, he replied “no.”  “Express permission or implicit permission, no,” replied Silverstein, giving Jamie the best ammunition to go back to arbitration.  While there’s no finger pointing yet, Boies hasn’t asked whether Silverstein was asked to modify the agreement directly by Frank.  “I thought,” Silverstein testified,” it was a drafting error being cleared up,” later admitting, “I just miswrote it.”  Silverstein’s admission now forces Frank back to a more vulnerable position before he boldly moved to trial.  Why Susman went to trial knowing the discrepancy in the postnuptial agreement is anyone’s guess. Now Frank faces more pain in arbitration than before Jamie offered $!00 million and some team profits before trial.

            Frank’s attorney, Steve Susman, grossly miscalculated the pitfalls of going to trial.  He knew that Jamie, who practiced corporate and family law in New York and Boston for 15 years, wouldn’t roll over.  Susman also knew about the altered postnuptial agreement but still rolled the dice in court.  “By failing to go to the clients with this innocent mistake, as he calls it, he deprived both parties of the opportunity to clarify what they wanted,” said Jamie’s attorney Bruce Cooperman.  Boies raised the possibility that Silverstein’s “drafting error” was actually a calculated ploy by Frank to steal ownership of the Dodgers.  “I call it shenanigans,” said Dennis Wasser, one of Jamie’s attorneys.  “I don’t know if it’s an honest mistake.  I don’t believe it’s a mistake,” giving Jamie the upper hand in the new arbitration hearing schedule for Friday, Sept. 24.  Frank finds himself behind the eight-ball.

            Susman’s decision to go to trial looks like a rookie mistake now that the cat’s out of the bag with respect to the altered postnuptial agreement.  Boies made Silverstein squirm trying to explain how he could possibly alter a legal document without notifying both parties.  While it’s still unclear, Silverstein either tried to pull a fast one on Jamie at Frank’s request or tried to cover his tracks:  It’s unlikely he acted alone.  “Tried to the do the right thing,” said Victoria Cook, one of Frank’s attorneys, rejecting the idea that Frank ordered Silverstein to make the correction.  Insisting that it’s a “drafting error,” only helps Jamie’s position by making Frank’s legal team look sleazy and desperate.  While Silverstein’s now a sacrificial lamb, truth be told, he probably followed Frank’s orders to create two separate posnuptial agreements in order of outsmart Jamie on her right to Dodger team ownership.

About the Author  

John M. Curtis writes politically neutral commentary analyzing spin in national and global news. He's editor of OnlineColumnist.com and author of Dodging The Bullet and Operation Charisma.