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November 19, 2012

Bizball

Marlins Ownership and a History Lesson in Greed

“The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right; greed works.” —Gordon Gekko, Wall Street

I don’t know if Miami Marlins owner Jeffrey Loria owns a copy of Oliver Stone’s Wall Street. The movie, which came out at the height of the 1980s’ “excess is best” period would seem to play well with him. That now infamous speech by Gekko summed up everything that was wrong with not only Wall Street but also where America was headed. Loria, it seems, is still living in the 80s.

I’m not saying Jeffrey Loria is Gordon Gekko. The biggest difference between the two is that while Gekko out-and-out broke rules, Loria has been able to skirt the edges of them, dodge bullets, and snub his nose in the process.

To understand Loria, the greed element, and what his most recent fire sale means requires understanding of his history within Major League Baseball.

Loria Gets the Expos
He first surfaced on MLB’s radar in 1994. After purchasing the minor league Oklahoma City 89ers in 1989, he sold them in 1993. In 1994, he set his sights on the Baltimore Orioles, who were being auctioned out of bankruptcy. He lost the auction to Peter Angelos but kept his desire to get into MLB. In 1999, he took $12 million and purchased a 24 percent minority stake in the Montreal Expos. As the club floundered in red ink, cash calls were made to the investors in the club. When the other investors failed to come through, Loria swooped in and eventually found himself the majority owner of the Expos at 94 percent.

It’s here where the “Loriaizing” of each club he’s owned began to take shape. He almost immediately said that Olympic Stadium was substandard and that a new ballpark was needed. When that didn’t seem to be taking hold, Loria and his stepson David Samson, who was made club Executive Vice President, began dismantling the fan base further by not coming to an agreement for English-speaking radio and television deals. The effect was simple: it made the case that Montreal was not a viable baseball market even if the actions of the ownership had played a key part in driving fans away.

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24 comments have been left for this article.

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code of conduct

tmangell

Excellent article, Maury.

Nov 19, 2012 05:20 AM

rating: 11

seabass77

Wow.

Nov 19, 2012 05:22 AM

rating: 5

Maury Brown

BP staff

Thanks much

Nov 19, 2012 06:30 AM

captnamerca

Hopefully the voters in Miami realize they've been duped and actually do somethign about it.

BWAHAHAHAHAHA!

Nov 19, 2012 06:31 AM

rating: 2

Shaun P.

They already did. Back in 2011, 88% of the folks who showed up to vote, voted to recall the then-mayor of Miami.

http://www.reuters.com/article/2011/03/16/us-usa-florida-election-result-idUSTRE72F0EC20110316

Nov 19, 2012 13:24 PM

rating: 4

jdeich

You should see if any newspapers in southern Florida would be interested in running stories based on this kind of research. While fans now know (if they didn't know already) that Loria is fleecing them, the degree might be underestimated.

Nov 19, 2012 06:37 AM

rating: 6

APer930

What a tremendous article, Maury, great research. I've heard much of this over my time as a Marlins fan, but I have only attended one game since 2007. I'm waiting for the day someone finds something illegal and Loria and Sampson go to jail. I may never see that day, but one can hope. The Marlins I rooted for as a kid don't feel the same anymore. I'm a nomadic fan now, rooting for a different team every week.

Nov 19, 2012 07:45 AM

rating: 2

mmason

"Loria and Co. were so cheap that when the sale was complete, they took all the office furniture and computers, leaving people like Omar Minaya, who was GM of the Expos, with a mess."

Wow. Just Wow. Fantastic article Maury, damning facts.

Nov 19, 2012 08:18 AM

rating: 2

steve.k

What really ticks me off about the Marlins and Loria is thinking about some of the great sell-offs from history. Which are the 1913-14 A's and the 1931-32 A's. The first one was in reaction to increasing player salaries from the upstart Federal League. Mr. Mack probably could have waited it out. The second one, not so much as the Depression had another 8-10 years to go. But Mr. Mack did not have zillions coming in from TV revenue sharing and I believe his only income came from team ownership.

Messrs. Loria & Samson - you have earned every bit of scorn. How can anyone remain a Marlins fan???

Nov 19, 2012 09:42 AM

rating: 2

boards

Currently reading the Connie Mack bio. The author definitely makes the point that history has been unkind to Mack's legacy, most branding him as a skinflint when that was not the perception at the time.

You are right: all of Mack's "wealth" was earned as a player, manager and owner. The vast majority of owners then, and all now, made their fortunes elsewhere.

Nov 19, 2012 20:48 PM

rating: 0

lipitorkid

Great article.

But if the Marlins start winning games next year, no one, and I mean no one want's to see anyone slowly removing pieces of clothing from a cardboard cut-out of Jeffrey Loria.

Nov 19, 2012 09:51 AM

rating: 7

Maury Brown

BP staff

The league has approved the trade. As I outlined, this should have come as no surprise.

Nov 19, 2012 12:10 PM

Richard Bergstrom

You can't blame Bud for approving the trade.. it sets a dangerous precedent if he starts deciding what trades are salary dumps, which trades are "equal" etc. But, it is a "fox in the henhouse" argument.

I do find it a little sad that Loria remains in yet known competitive owners like Mark Cuban are kept out.

Nov 19, 2012 13:48 PM

rating: 6

Shaun P.

Great article, Maury. I shouldn't be amazed, but I am that Selig and the owners don't more thoroughly vet potential owners. Of course, Loria did them a big favor by helping to kill MLB in Montreal and then taking the Marlins on in exchange. And now they're stuck with him.

The other portion of the triangle has plenty of its own dirty laundry (the Yawkey trust, controlled by John Harrington, taking the smaller Henry-Werner bid), but of course, given 2004 and 2007, almost no one in Massachusetts is interested in it.

Nov 19, 2012 13:31 PM

rating: 4

Richard Bergstrom

As I recall, after the MLBPA handslap, the Marlins raised payroll by signing Josh Johnson to a backloaded contract..

"The Marlins recently came under scrutiny amid concerns from the players' association that they weren't living up to a provision in the basic agreement that requires teams to use revenue-sharing receipts to improve performance on the field"

http://sports.espn.go.com/mlb/news/story?id=4826840

Nov 19, 2012 13:46 PM

rating: 0

Maury Brown

BP staff

Yep, Richard. That's exactly what happened.

Nov 19, 2012 14:00 PM

Richard Bergstrom

Btw, since you touched on contraction earlier, considering MLB revenue and attendance in general has done very well in recent years and the increase in available international free agents, I'm surprised there hasn't been talk of expansion. Finding some way to get to 36 teams would get rid of a lot of the "interleague game every day" schedule problem.

Nov 19, 2012 14:14 PM

rating: -1

amazin_mess

This all has one common denominator. Bud Selig.

Nov 19, 2012 16:27 PM

rating: 5

Richard Bergstrom

This all has one common demoniator. Money.

Nov 20, 2012 09:48 AM

rating: 0

Pat Folz

Fantastic article, as others have said!

The point about future stadium plans is an interesting one. The Marlins shenanigans might come back to bite MLB pretty hard in about 10 years, when inevitably the teams that built their new stadiums in the early 90s (Baltimore, Cleveland, etc.) start complaining that they "cannot remain competitive" in such "outdated facilities" and want taxpayers to build them new ones.

Nov 19, 2012 23:11 PM

rating: 1

saigonsam

This may seem far fetched, but what if the Marlins go to the Winter Meetings again and replicate last year's spending spree. Maybe there is a market inefficiency of back-loading free agent contracts, and then trading the players the next year for young, cheap players. Then repeat until enough prospects develop and the right free agent combo is hit.

I play in a keeper fantasy league where this is the only strategy for winning.

Nov 20, 2012 00:51 AM

rating: 2

kddean

I just love that Loria et al are MLB owners, but Mark Cuban is deemed by them to be distasteful.
What a bunch of a-holes.

Nov 20, 2012 06:34 AM

rating: 2

Richard Bergstrom

Hey that was my line! :)

Nov 20, 2012 10:01 AM

rating: 0

Isaac Lin

A small clarification: the previous Expos ownership group, under general partner Claude Brochu, had stated the need for a new ballpark in order for the Expos to succeed. Brochu initiated plans for a downtown stadium, lined up a company to sign up for the naming rights, and gotten the federal and provincial government levels to start nodding in the right directions (the plan was for the land to be provided by the federal government at a heavily discounted price, and provincial tax revenue from player salaries to be used to pay the interest on the park construction loan).

Loria, however, decided to reset the ballpark plans, breaking off the team's agreement with the naming sponsor, and subsequently failing to close an agreement with the provincial government.

Regarding the English radio and TV deals, this was not directly tied to the progress of the ballpark plans, as the gap in coverage occurred in Loria's first year of ownership. Reportedly the Expos had been paying for their English broadcast deals, rather than receiving revenue for them, and Loria wanted to at least break even. Unfortunately, there were no takers, and with the team not relenting, the Expos stayed off the public airwaves in English during 2000. (In later seasons, the team found specific sponsors to fund the radio broadcasts.) They were trailblazers in a sense, becoming the first MLB team to broadcast their games on the Internet, and in today's world of ubiquitous Internet access this approach might be moderately successful, at least at putting some pressure on the traditional broadcasters. It was too ahead of its time for then, though, and unfortunately the recent Ford C. Frick winner Dave Van Horne left after the 2000 season.

Nov 20, 2012 09:58 AM

rating: 1

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