Owners' Divorce Raises Team Ownership Question

On October 14th, 2009, Fred and Jamie McCourt announced that they would be getting a divorce after nearly 30 years of marriage. This was a significant announcement, as the McCourt family has owned the Los Angeles Dodgers since 2004. Almost instantly, a debate began as to whether Fred and Jamie were legally co-owners of the team, or if Fred had complete ownership rights. Jamie was the team's acting CEO at the time, but it is being questioned whether she actually had a share of the team's ownership.

Official divorce trial proceedings began Monday, August 30. During the opening stage of the trial, Frank McCourt and his lawyers argued that the postnuptial agreement gives him full ownership of the team, and Jamie should not be compensated for it in any way, as it was never part of her property. Jamie's lawyers, on the other hand, contested that although she signed a document establishing her husband's total ownership of the team, she was coerced into signing it and believed that it listed the team as a shared asset. They suggested that the ownership of the team should be split in half under California's community property law.

Soon after the trial began, it was discovered that the six copies of the prenuptial agreement are in fact different. Three of the copies use the word "inclusive" to describe the Dodgers, indicating that the team belongs completely to Frank. The other three copies use the word "exclusive," meaning that the team belongs to both Frank and Jamie. It appears that neither Frank nor Jamie knew of this discrepancy, and this has become a key issue in the trial proceedings. Frank's lawyers contest that it was simply an unfortunate but meaningless typo, while Jamie's lawyers believe the error is grounds to throw away the document and settle the dispute by splitting the team in half.

This issue highlights the importance of clarity in legal documents. It also raises questions about how situations like this should be handled. When the law doesn't provide a clear resolution to a problem, how can it be solved in a way that is fair to both parties? In this particular instance, I think ownership of the team should be divided evenly between Frank and Jamie. Jamie clearly believes that the document she signed gave her partial ownership of the Dodgers, otherwise she wouldn't have signed it, since shared control of the team was very important to her.

I researched what happens when business partnerships break up, and the law says that control over the business is determined by a partnership agreement that is generally written and signed when the business partnership begins. In this case, the McCourt's prenuptial documents serve as their partnership agreement. When a partnership agreement doesn't specify what happens when one partner leaves, then the state's partnership laws are used to solve the issue. In this case, there is ambiguity as to which party gets control of the Dodgers, so I think the fairest way to settle it is to split the team evenly between them. This is also probably the most likely result, although a decision probably won't be made for several more months as the parties have gone to mediation twice without results. The downside to splitting up the team is that it would probably cause severe problems for the already struggling Dodgers organization, as it is difficult for a business to be run by two separate parties that don't get along. How do you think the issue should be resolved?