We have long speculated that the one way the Rays may be able to get out of their Tropicana Field contract, would be to file bankruptcy. Apparently this worries the city of St. Pete also.

In preparation for a stadium battle that could ultimately end up in the courts, the City of St. Pete has hired a law firm, Brown Rudnick LLP. And the contract between the law firm and the city was penned by a bankruptcy lawyer.

The city is concerned that the Rays might file bankruptcy as a way to get out of its stadium contract, City Attorney John Wolfe said. The city has no evidence the team is planning to do that, though, he said…Bankruptcy has “been mentioned in various articles as one of the possibilities, and we want to have a lawyer ready to go in the event the Rays decide they no longer want to honor their contract,” Wolfe said.

Michael Sasso of the Tampa Tribune spoke with a lawyer that represented the NHL’s Phoenix Coyotes in their bankruptcy case. The lawyer speculates that stadium leases could potentially be thrown out during a bankruptcy case. However, the lawyer doesn’t mention whether the same would be the case for the Rays, who technically don’t have a lease.

The contract with the City of St. Pete is a “use-agreement” which renders the Rays more like business partner of the city, rather than a tenant.

Another concern for the city is the cost of battling the Rays in court. According this story, the city’s contract with the law firm is capped at $5,000 in fees. At $480 an hour, that is not going to go very far.

It is clear that the city of St. Pete is worried that a battle is looming. But at some point, they may have to decide if this is a battle that is worth fighting.

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3 Comments

  1. Richard Welty says:

    it's tremendously frustrating to me that the city has chosen to be adversarial about this, and insistent on the contract. it was a bad contract, it never should have been signed in the first place, and if the city understood business at all, they'd be willing to talk.
    just standing around with their finger in their ears chanting "we have a contract, we have a contract" is asking for trouble, and it's coming.

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    • Gus says:

      It is a good contract for the City because it guarantees the team in its boundaries, and basically free rent for the Rays, so "good" for them in a pure cost perspective.

      The only thing "bad" about the contract seems to be the northern ownership's (foolish) belief that open air baseball will attract more fans in Florida, which it won't and that a downtown Tampa location will generate more than the increased costs of a new stadium there.

      Any bankruptcy petition would reorganize the Rays assets and have to show an insolvency (hard for them to do based on what we've seen), and I think jeopardize all of their existing contracts. Longoria would be very excited to get out of his "bad" contract.

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  2. joseph says:

    St. Petersburg smells the rats jumping ship...lawyer up against these
    Goldman Sach wise guys...I'll give you 2%

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