Ex-Marlins owner faces fight with county over financial disclosure
The finances of the Miami Marlins have always been one of the most sought-after secrets in local sports. Now a judge might start exposing them.
A lawsuit by Miami-Dade against the Marlins asks for a trove of financial information from Jeffrey Loria’s $1.2 billion sale of the team last October, as well as disclosures of some of the team’s long-term finances under Loria’s tenure. Loria has already resisted turning over anything but a bare-bones summary of the details of the October sale to Derek Jeter and partners.
The financial details behind that sale are the target of the lawsuit by Miami and Miami-Dade County over a nearly 10-year-old provision that traded more than $400 million in public money to build Marlins Park for a 5 percent share of certain proceeds if Loria sold the team by the spring of 2018.
Loria’s lawyers provided a fivepage financial summary trying to justify the New York art dealer’s claim of a $140 million paper loss under the terms of the 2009 stadium agreement. On Thursday, Circuit Court Judge Beatrice Butchko ruled against Loria, saying he needed to provide more details to justify his claim of owing the taxpayers nothing on the sale of a team he bought for $158 million in 2002.
County lawyers hope the ruling will open a broad window into the team’s finances under Loria. The 2009 agreement calls for an independent accounting firm to look at the confidential financial documents and make an unbiased recommendation on profit-sharing. But a MiamiDade attorney at the hearing argued Loria’s actions have thrust the question into what could be a drawn-out, detailed trial to explore how much Loria actually made selling to Jeter and partners.
“Our argument is it’s for your honor and a panel of jurors to determine what the 5 percent equity payment is,” said Jorge Martinez-Esteve, an assistant county attorney in MiamiDade.
Butchko declined to rule on whether she would let the dispute go before a jury — raising the prospects of county lawyers bringing Loria or even Jeter to the stand — or simply order both sides to undergo the arbitration process laid out in the 2009 agreement. Butchko could also oversee the appointment of an accounting firm to audit Loria’s numbers in private, likely shielding many of the underlying records from public view.
Marlins lawyers argued the county and city can learn more details if they want to protest Loria’s calculations before a neutral arbitrator.
“We are open to curing any request for information,” said Loria lawyer Peter Duffy Doyle, from Proskauer Rose in New York. “We are not telling them to sit on their hands. We want to have an open discussion.”
The Marlins’ financial health has been a matter of dispute since Miami and Miami-Dade leaders pushed through a series of unpopular funding packages in 2008 and 2009 that had the two governments agree to pay nearly $500 million in tax dollars for construction of the 37,000-seat Marlins Park in Little Havana and the garages that surround it. The Marlins contributed $155 million.
At the time, Loria argued his baseball team’s home in the Miami Dolphins’ stadium had left the franchise on a doomed track and he needed to turn around a money-losing operation by moving into a true baseball park. The county did not insist on seeing the Marlins’ books before signing the deal. Leaked financial reports published by Deadspin showed the franchise turned a $29 million profit in 2009, the same year Miami and Miami-Dade granted final approval for the stadium construction.