Bankruptcy judge orders Texas Rangers’ creditors, MLB to give each other documents in case

Judge orders documents released in Rangers’ case

DALLAS — Major League Baseball and Texas Rangers’ creditors trying to block the team’s sale must hand over documents about actions and conversations that took place before the club filed for bankruptcy last month, a judge ordered Monday.

Each side has accused the other of withholding information related to the team’s Chapter 11 bankruptcy filing.

U.S Bankruptcy Judge Stacey Jernigan said the MLB had documents that were relevant in the case. She also said that “in fairness,” the lenders also had to release certain documents.

Creditors oppose the team’s plan to pay them $75 million and sell the club to a group led by Pittsburgh attorney Chuck Greenberg and Nolan Ryan, the Hall of Fame pitcher and team president.

Since the sale was announced earlier this year, creditors have stalled it over concerns about team owner Tom Hicks’ financially strapped ownership group.

The creditors argue that the team doesn’t just owe $75 million, but is obligated to pay more than $525 million in loans that Hicks Sports Group defaulted on last year. Creditors also have argued that the Greenberg-Ryan bid, which Major League Baseball endorses, was not the highest.

Creditors sought the documents — including communications between the team and league just before the bankruptcy filing — to bolster their claims that the filing was made to remove their rights to approve the sale. A bad-faith filing would be a bankruptcy code violation and might kill the plan.

But Peter C. D’Apice, an attorney representing the baseball commissioner’s office, said MLB also needs some lenders’ documents in order to defend itself against those claims. He said the lenders knew about the league’s discussions about the bankruptcy, bids for the team and other issues that “they’re now complaining about.”

Yolanda Garcia, an attorney for team owners, said the Rangers have given the team’s creditors more than 8,000 pages of documents but that lenders have withheld some documents.

Jernigan also ordered lenders to provide information to the team as well as the league and said she hoped the order would not mean delays in the bankruptcy case, where mediation is set for July 6 and a confirmation hearing on the team’s plan is scheduled for July 9.

U.S Bankruptcy Judge D. Michael Lynn, who is unavailable to oversee proceedings in the case this week, said earlier that the Rangers had to adjust the plan, although not the amount owed, in order to avoid creditors killing it. The team on Friday revised its plan and restored creditors’ rights under their previous loan agreements.

Lynn has said he will not approve the plan unless it meets certain bankruptcy codes.