Do You Believe In Magic? More Questions About Dodger Ownership.

Seven seconds on the clock.  Lakers down a point to the Boston Celtics.  Magic Johnson gets the inbound pass.  He hesitates for a moment, starts his dribble, cuts right toward the lane.  Five seconds.  Four seconds.  Magic takes a step toward the basket.  Three seconds.  Celtics Big Men Kevin McHale and Robert Parish out to defend.  All three men go to the air.  Magic puts it up with the right hand.  Basket good with two seconds left!  And after Larry Bird clanked one off the iron at the other end on a shot that looked good until it wasn’t, the Lakers took a commanding 3-1 lead in the 1987 NBA Finals.

Magic Johnson has a knack for winning. (Image source:

These are the moments that Magic Johnson has lived for all of his life: the chance to win on the biggest stages, to achieve the greatest triumphs, to make the big play at the most crucial moments.

So it should come as no surprise that Magic Johnson would have come to the rescue when another storied Los Angeles franchise, the Dodgers, needed to be saved from Frank McCourt.  The fans were irate.  A rival had emerged that was beating them senseless.  This was like 1969 all over again, except this time it was the Dodgers fans’ party balloons stuck in the rafters, and wheras Bill Russell was a great competitor, Frank McCourt appeared to be a great crook.

So wouldn’t it make sense for the man who finally chased away the Laker demons of the past and beat mighty Boston for the championship not once but twice to also be the man to save the Dodgers and bring greatness to the City of Angels once again?  And there he was.  Magic Johnson, hero triumphant, assembling what appeared to be an all-star cast.  It would be Magic himself with the million dollar smile and iconic status, undoubtedly the face of the franchise as far as off-field matters were concerned.  Stan Kasten, who helped build a dynasty of division winners and championship contenders in Atlanta, would be his point man on baseball issues.  And Guggenheim Partners, with Mark Walter as their primary representative, would be the big financial contributor that would bring the Dodgers out of the dark days and back to prominence.

The city was saved!  The Dodgers returned to a place of prestige!  The stars started to come out!  The payroll inflated!  Certainly, championships and harmony would follow.

Magic Johnson’s rivalry with Larry Bird made for some great photo opportunities over the years and evolved into a great friendship between two equally minded competitors. (Image source:

Except they haven’t.  And while it’s perfectly acceptable for Magic Johnson and Larry Bird, fierce rivals on the court, to be great friends off the court, one has to question why Magic Johnson would want to be seen, or even put in the same context, as Frank McCourt.

Photo opportunities such as this one involving Magic and Frank McCourt’s billion dollar smile on Opening Day 2012, however, might not be the sort of “friendly rivalry” pictures that Magic Johnson wants associated with his reputation or his public image. (Image source:

Now, it can’t be established for absolute certain that keeping Frank McCourt on board in any capacity, even those not involving the team, had anything to do with Magic Johnson.  However, this quote from this News Services article around the time of the Dodgers sale looks a little worse today, now that we know just how much leverage Frank McCourt has with the land surrounding Dodger Stadium.

“I am thrilled to be part of the historic Dodger franchise and intend to build on the fantastic foundation laid by Frank McCourt as we drive the Dodgers back to the front page of the sports section in our wonderful community of Los Angeles.”

-Magic Johnson, March 27th, 2012

Let those words sink in for a moment.  “Fantastic foundation.”   These words could be just a gracious way of being above the situation, opting to move on from McCourt peacefully rather than rehashing the complaints of fans or the ugliness that resulted in the Dodgers’ finances being monitored by Major League Baseball in 2011.  However, given what the documents about Guggenheim’s agreement with Frank McCourt actually state, it looks more and more like Guggenheim actually welcomed McCourt’s approach, which was to use a Major League Baseball franchise to leverage other investments and take on large amounts of debt and, in effect, use other peoples’ money to do it.

Here’s a couple more paragraphs from that ESPN article to ponder before we get to something even juicier here.

There was some concern among MLB officials about the financing of the Walter bid because some of the money was coming from insurance companies that are owned by Guggenheim. A person familiar with the baseball owners’ teleconference Tuesday said several team owners voiced that during the call. The person spoke on condition of anonymity because MLB did not make any announcements.

“The problem there is a fundamental problem as you go into an auction, and that is the absolute reliance on other people’s money,” Ganis said. “It means a lot of regulators. It means either shareholders or, depending on which insurance companies it’s coming from, the insured themselves.”

Do you understand what’s going on here?  There’s a reliance on other peoples’ money.  If the value of the investment goes down in value, those people lose money.  Guggenheim Partners are not in the business of losing money for investors.  There are hundreds of billions of dollars at stake.

So how does this involve one Earvin “Magic” Johnson?  Here’s where we get to something interesting.  Magic’s business thinking is well documented in this News Online piece.

Here are a couple notable footnotes from the piece.

-After using his own money to do business, Johnson said he advanced to “using other people’s money,” which required some convincing of those other people. He sought $150 million from a major pension fund and did not get funded until the third attempt, and only for $50 million. But he used that $50 million to buy a shopping center for $22 million, built up the center until it was fully leased, then sold it for $48 million.

-Johnson urged business people to partner together for success and not worry about who gets the credit.

“Fifty percent of something is better than 50 percent of nothing, so partner, partner, partner,” Johnson said. “You are in a successful business, that’s all that matters.”

Now, the idea of using the investment money of others is nothing new.  Magic has done it before and had startling results.  However, it demonstrates that part of Magic’s business philosophy involves the importance of the use of other peoples’ money and partnering up.  As you may recall, Magic’s business partners now include Frank McCourt due to the land ownership situation at Dodger Stadium and may possibly involve a silent partnership with Junk Bond King Michael Milken.  Even with Magic’s history of successful business ventures, including 24 Hour Fitness Sports locations and 125 Starbucks locations, there’s an awful lot of taint on those two partnerships.

Magic Johnson had an opportunity to speak up early in the bidding process and say “folks, we need to get rid of Frank McCourt.  He is a liability.  He is the kind of bad press that we do not need now and that we do not need ever again.”  Magic had a chance to show the fans that he had their best interests at heart.  Magic could have asked his partners, who benefited greatly from his standing in the community, to be transparent in their dealings and to make sure that people like Frank McCourt and Michael Milken were in no way involved in the franchise, and while there is no evidence that Milken is directly or even indirectly involved with the Dodgers at the moment, his past attempts to get involved with the Dodgers and his current involvement with Guggenheim have to, at minimum, raise an eyebrow.

Instead, Magic worked with the rest of the ownership group to hide the reality of the situation, to reassure the public that Frank McCourt could not make decisions regarding the land without Guggenheim Partners’ consent.

Instead, we now know that this is tantamount to Frank McCourt holding a great deal of real estate around Chavez Ravine hostage.

By the way, we were warned that this might happen, and while Frank McCourt doesn’t own all the land surrounding Dodger Stadium, he has a vice-like grip over just enough of it to dictate how it will be used and potentially profit over either its sale or its use.

Guggenheim and company, as it often does, tried to spin this positive.  And used Magic Johnson to do so.

What was Magic’s “explanation” (and it was Magic who addressed this, by the way,) for McCourt staying on with what effectively amounts to control over what can be done with much of the Dodger Stadium land? Why might Guggenheim have a hard time developing, say, an NFL Stadium in the parking lot?

According to the Dodger Thoughts article linked above:

Johnson: “Frank McCourt is not involved in any, shape, fashion. If you need me to come up, I’m 6-9. The rumors, we’re squashing them right now … his only future profits is from new development, if we do any. There’s nothing on the table.”

Johnson: “This franchise is moving forward with us. If (McCourt) is part of the future development, so what? … That’s how you got to get it sometimes. We own it. We control everything. Fans got to understand, we’re going to make sure we’re going to win and have a great team every day and that they’re going to have a great experience. … Frank’s not here, he’s not part of the Dodgers anymore — we should be clapping just for that.”

The documents that were released seem to indicate that even if Frank McCourt isn’t involved directly in the franchise, he’s certainly looming large.  To take Magic Johnson’s words, he might need to bring all 6 feet 9 inches of him and “come up.”  The fans have some questions about those documents that just got released and what it is exactly that they mean.  And they want transparency.

Oh, and in regard to the profits from new development?  Frank McCourt could sabotage those, too.

We’ll conclude with one more thought from Magic in the News Online piece.

“You’ve got to stay on the hustle, stay on the grind.  Just because you have a successful business, don’t rest, because you can lose it all tomorrow. I’m a control freak, and I don’t apologize for it, because if it’s my hands, we’re going to win it.”

Dodger fans want a winner both on the field and in the owners’ box.  The ball’s in your court, Magic.  The fans have been looking to you to change the direction of this franchise.  Winning ballgames is important.  After what Dodger fans went through with Frank McCourt, even more than before, so is the truth.

Magic Johnson has a reputation for championship triumphs and great comebacks. Magic can still lead the Dodgers to a great comeback. But to do so, he will have to use his clout to bring true winners to the Dodger organization while cutting ties with losing prospects such as Frank McCourt. (Image source:

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