Yesterday afternoon, Daniel Kaplan of the Sports Business Journal scooped everyone by posting breaking news about the Rangers' bankruptcy proceedings on Twitter. "Federal judge finds Texas Rangers impaired," he wrote, "likely means they can block the sale."
This wasn't quite right. Judge D. Michael Lynn, who's presiding over the Rangers' Chapter 11 bankruptcy proceedings, did not find the ballclub impaired. (Nearly four decades of Rangers fans might've agreed with him if he had, but that's beside the point.) And the Rangers were not going to block their own sale. Rather, the judge found the club's creditors impaired, along with its equity owners.
Kaplan quickly moved on. "Said source close to creditors: 'This is great news. [...] Means plan is not confirmable,'" he reported. He made no other further information available. For an hour or two, there was no further indication from Kaplan regarding the context for his coverage. There was no explanation of the grounds for the judge's decision, or detail about Kaplan's source(s), or why he granted one source close to the creditors anonymity.
Meanwhile, Judge Lynn's memo was uploaded to the website Scrib'd, where anyone could peruse it. Within an hour or so of Kaplan's initial posting, "Unfair Park" -- the blog of the Dallas Observer -- had posted a link to the document, accompanied by an entry quoting Kaplan's messages, and the claim, "It would appear to be a good day for the creditors."
Soon thereafter, however, the Observer updated its story, adding the following:
A good Friend of Unfair Park, who happens to be a local bankruptcy attorney, summarizes thusly for those of us who were not smart enough to go to law school:
"If the creditors are happy, it's because Lynn didn't just completely pour them out. He is not going to confirm the plan as it now stands, but all Hicks has to do is amend the plan to pay the creditors interest on their 75MM.
Once the new plan goes on file, the two Rangers equity companies have to re-vote to approve it. In order to scuttle the deal now, the creditors have to figure out a way to take control of the Rangers equity companies so they can cast the vote the way they want. The involuntary bankruptcy cases that the creditors filed against the Rangers equity companies may eventually get the creditors some control, but not soon enough I'll bet. Later, I think Kaplan et al. will realize the creditors (Monarch) just won the battle and lost the war."
At the same time, Kaplan was engaged in an argument with another, legally trained reader from LSB, who -- having read the memo -- found it less of a victory for the Rangers' creditors than Kaplan's reporting implied. In response to the reader's observation that the judge's memo seemed to indicate that minor changes might resolve the situation, Kaplan replied, "Minor? Oh come on. The judge ruled the plan can't proceed without lender approval. End of story."
But, of course, it wasn't the end of the story. And with due respect to the good friend of "Unfair Park," the required modifications to the plan were not obviously limited to adding interest to $75 million dollars.
And the reports kept coming, fast and furious.
Buster Olney, about an hour after Kaplan's tweet: "The judge's decision today on the Rangers' creditors is viewed by execs in baseball as a big blow to the team's efforts to trade pre-Aug. 1." No word on which execs; no word on whether or how Olney had managed to poll a representative sample of informed decision-makers within an hour or so of Kaplan's tweet, and before most people had a chance to digest the judge's memo.
Craig Calcaterra, at about the same time: "Big loss for the Rangers in b[ank]r[u]ptcy court today. Decision could end any hopes of a move before the deadline." In his accompanying blog entry, he stated, "[The judge's ruling] means [the lenders] can vote to accept or reject the prepackaged plan that the team had come up with. Of course, the creditors have said they would reject the prepackaged plan, so unless something dramatic happens soon, they probably will." He made this assertion despite the fact that, as he admitted, he hadn't read the judge's memo in its entirety.
In lieu of that, Calcaterra referred readers to Maury Brown's website, and concluded, "That sound you hear is every Rangers fan in the world screaming bloody murder to the heavens above. Once they get done venting, however, they should refocus those screams at Tom Hicks because he's the one that got everything in such a mess to begin with."
What did Maury Brown's website have to say at the time? The headline read, "Judge's Ruling in Texas Rangers Bankruptcy Case Could Pave Way for Lenders to Block Sale"; the report opened, "The bankruptcy judge in the voluntary bankruptcy case of the Texas Rangers may have dealt a blow to the prospective ownership group led by Chuck Greenberg and Nolan Ryan." Brown's piece cited Kaplan's earlier "tweet." Separately, he tweeted agreeably at Kaplan, "Yeah, this is no small deal. Mediation seems like best route for both sides. Plan would have to be amended greatly, otherwise."
Kaplan, for his part, posted his own story on the Sports Business Daily website (with no paywall); its headline was, "Judge rules Rangers' creditors have right to block sale of team." In this report, however, he also noted, "Lynn did not order the Rangers to pursue the Crane bid, and in fact ruled the club was not bound to take the highest offer." This was an aspect of the memo that had not received much attention on the afternoon, though it had been a central focus of coverage leading up to the judge's ruling.
Kaplan and Brown proceeded to give on-air interviews with Dallas-Fort Worth radio shows (the former with "The Hardline"; the latter with Randy Galloway) to explain their expert opinions on the day's events.
Meanwhile, the churn continued -- but with a twist. One or two hours after Kaplan's initial tweet, Evan Grant posted his first comments at the Dallas Morning News -- and struck a cautionary note. "First," he wrote, "Rangers business-side officials did not comment on judge's opinion today, so most of this is speculation of the purest nature." Similarly, the Fort Worth Star-Telegram's Barry Schlachter observed, "The decisions represented a partial victory for the lenders… [but] just how big the setback is remains to be seen."
Just more than an hour later, Grant returned with a copy of Eric Morath's coverage of the memo for Dow Jones. The headline: "Ruling does not give lenders ability to veto sale." Morath's reporting is also worth citing at length:
A U.S. bankruptcy judge said Tuesday that the Texas Rangers baseball team's Chapter 11 plan doesn't make lenders to the club's owners whole, but that doesn't give the lenders the right to block a sale of the franchise….
The judge said the plan must be modified to grant [the lenders] the same rights against the bankrupt entity, Texas Rangers Baseball Partners, once it emerges from Chapter 11, as the lenders had before that entity filed. But since that entity likely will have sold its most valuable asset -- the Major League Baseball team -- the lenders' "rights may have lost much of their usefulness"...
[Lynn] said the lenders could pursue possible damage claims against the bankrupt entity and Hicks Sports Group following confirmation of the Chapter 11 plan. If the changes Lynn suggested are incorporated into the team's bankruptcy-exit plan, "the plan will be confirmable," the judge said in court papers.
Later, Maury Brown weighed in again, but with a considerably different tone. "Upon Further Review, Texas Rangers Bankruptcy 'Plan' Could Move Forward Shortly," his headline read. Brown's intro: "After further inspection, press reports regarding a U.S. Bankruptcy judge's ruling saying creditors had veto power over a 'prepackaged plan' that would exit the Texas Rangers from voluntary bankruptcy may not be as detrimental as initially believed."
For his part, Kaplan refocused on the appointment of William Snyder as Chief Restructuring Officer. He began by noting, "Other huge development of the day with [Texas R]angers: judge appointed a chief reconstruction officer to also vote on the sale: more in S[ports] B[usiness] D[aily] tom[orrow]." He later admonished Brown that the latter's latest entry reflected "the team spin, but for now [the sale is] blocked. And the real power has been shifted to this chief reconstruction officer."
In another post, Kaplan asked his persistent LSB interrogator, "What are you, a team plant?" and reiterated, "Believe what you want. Right now the sale is blocked and the CRO has a lot of power." But not long thereafter, he opined, "[The] judge will really try to resolve this…. But this may partly fall on the new CRO and his opinion" (emphasis added). And Brown came back with his own rebuttal: "But, there's ample text in the ruling that allows Debtors to reach certain criteria that blocks vote. Going to be tough."
So what are we to make of all of this? From a facts-about-the-sale perspective, I'm not going to venture an opinion. I'm not a lawyer. I don't play one on TV. I didn't even stay at a Holiday Inn Express last night. I have zero -- zero -- legal training. I've read Judge Lynn's memo a couple times now, and spent a fair amount of time talking about it with folks who seem to be knowledgeable, but I'm absolutely not in any position to make any definitive claims about the legal situation of the Rangers at this point.
(Before you read any further: reread that last paragraph.)
I don't think you have to be a lawyer, though, to follow the media chronology set out above -- and, in doing so, to realize something's not right. So I do have one strong opinion about today's events: the media coverage, especially of Judge Lynn's memo, left a lot to be desired.
I don't mean to paint the media with too broad a brush. I appreciate those reporters (mainly but not exclusively local) who, like Grant, cautioned readers that their analyses were speculative, and who emphasized that the ramifications of Judge Lynn's memo had yet to be properly contextualized. And I am equally thankful for those few journalists who, like Morath, not only appeared to have read the judge's memo thoroughly, but also included key passages of it in their reports, with enough context and depth for readers to start making sense of the ruling.
Unfortunately, those responsible takes were swamped by the coverage of those who, in their rush to get the story out first and fastest, made very questionable decisions. These were professionals -- people who make their living doing this sort of thing. And from them we saw reports that got basic facts wrong. We saw dependence on anonymous sources, with no stated rhyme or reason. We saw questionable assertions backed by little if any evidence. We saw reportage that more or less reversed course in the span of five hours.
And none of this happened because there were unexpected events that surfaced over the course of the afternoon. The news of the day was the judge's memo, and that was anticipated to be the case. The memo contained almost all of the new facts that (as I write this) have been reported and analyzed. That memo raised a number of obvious questions (both to my untrained eyes, and to a number of more trained pairs). But most of those who were quickest to report the story punted those questions for several hours -- even as they were publicly weighing in on the purportedly dire consequences of the judge's ruling for the Rangers.
Blurring breaking news with preliminary and tentative analyses is bad enough. Compounding the confusion by going live with incomplete information is worse. Adding ad hominem replies to readers to that mixture is toxic.
Look: I'm no Luddite. I'm (obviously, I hope) a fan of blogs. I think they have an important role to play in the media. I believe that even Twitter has its place in conveying key information. But the professionals who provide us with news have to do a better job of reporting in situations like these.
One reader here suggested that rather than post a piece like this, I should contact some of the reporters involved, and engage them in private, constructive, critical dialogues. That's a good suggestion, and I'm open to it. But after reading some of the responses to those who've already posed critical questions and perspectives, it doesn't seem sufficient.
The sale of the Texas Rangers is, on the grand scale of world events, a very minor issue – but that doesn't excuse journalists from reporting on it in a responsible, thorough, and professional manner. And if some don't, readers have no excuse for sitting by and letting it happen.
In short: the sound we should hear is "every Rangers fan in the world screaming bloody murder to the heavens above" – but for one day, at least, it's not just about Tom Hicks.