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For Sale: A Team With a Colorful Financial History

  • July 12, 2020

Doubleday refused after an appraiser had set a price, and, predictably, a lawsuit ensued. Wilpon contended that Doubleday was obligated to accept the valuation, which would have made Doubleday’s half worth $137.9 million. Doubleday had been looking for about 20 percent more.

Doubleday claimed he had been “double-crossed” by a “sham process.” He claimed in legal papers that Major League Baseball and the Wilpons were “in cahoots” in a scheme to keep team values down and manufacture “phantom operating losses” to make the game seem less financially sound and in that way create an advantage in negotiations with the players’ union. (Baseball dismissed the claim as “nonsense and a complete fabrication.”)

In the end, the ex-partners reached a deal and the Wilpons took over.

Like many wealthy and well-connected people, the Wilpons invested money with a financial manager named Bernard L. Madoff, who had impressive — and, in retrospect, unbelievable — rates of return. When it was discovered in 2008 that Madoff was running a Ponzi scheme, the Mets were bruised financially.

Though the team lost plenty of money, it had for years earned “profits” with Madoff’s investment firm. When some of the victims further down the pyramid sued to get a portion of that cash, the team wound up paying out tens of millions more.

Although it was not nearly as financially ruinous as the Madoff investment, a deal the Mets negotiated in 1999 with Bobby Bonilla was, and remains, a constant source of humor around the sports world. Bonilla stopped playing in 2001, but the Mets agreed to keep paying him $1.2 million a year … until 2035.

Article source: https://www.nytimes.com/2020/07/10/sports/baseball/new-york-mets.html

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