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November 23, 2010 7:02 PM

White & Case's Lauria to Rangers Bankruptcy Judge: "Why Don't You Call Me Blutarsky?"

Posted by Tom Huddleston Jr.

After a drawn-out bankruptcy process that ran from May until an explosive court auction in early August, it seemed like the circus surrounding the sale of the Texas Rangers was finally behind us. 

Apparently not everyone is ready to move on. In an article posted online Monday night, The New York Times reported on conversations held in the chambers of U.S. bankruptcy court judge D. Michael Lynn on July 9, during what may well have been a particularly interminable point in the case's proceedings.

With no court reporter on hand, the conversation was instead memorialized via an audio recording that Lynn ordered sealed. Recently, however, the judge granted the Times's motion to unseal the recording, which is what led to Monday's story.

In its story, the Times reports on Lynn criticizing journalists covering the case, lawyers trying the case, and even baseball's oft-maligned designated hitter rule. The article notes that Lynn felt as if the lawyers involved were using the media as a forum to influence the outcome of the case.

"I do not like being bullied," the Times quotes Lynn saying at one point, "and I will not be bullied."

Those lawyers included Chuck Greenberg, the former Pepper Hamilton partner who led the group, along with Nolan Ryan, that eventually bought the team.

According the the Times, Lynn also questioned the professionalism of Stephen Shimshak--a partner at Paul, Weiss, Rifkind, Wharton & Garrison who was representing Major League Baseball--after Shimshak threatened that the MLB would "take over" the team if the court did not approve its reorganization plan. 

The Times story is the latest twist in a bankruptcy drama that The Am Law Daily covered closely, from an intriguing start that raised the question of how much influence business interests and courts have over sports leagues to a climactic end that included a heated exchange between lawyers participating in the court auction. In between, there were stories about the growing roster of lawyers involved in the proceedings and even the addition of former Rangers superstar Alex Rodriguez to the case's creditors committee.

When former owner Tom Hicks decided to sell the team in late 2009, Greenberg's and Ryan's team of investors agreed to pay him $525 million. But Hicks's creditors sought a higher selling price and, after the team filed for bankruptcy, Ryan and Greenberg had to compete with other potential investors in the court auction. In the end, Greenberg's and Ryan's team of investors reached its objective of acquiring the team, but it had to pay roughly $70 million more than its original offer.

Considering the case's length, and its twists and turns, it is not much of a surprise that Lynn was already losing patience in early July. But that doesn't explain what might have been the most curious exchanges revealed by the times.

At one point on the tapes, White & Case partner Thomas Lauria--the lawyer for Greenberg and Ryan who was, as it happens, a colleague of Lynn's at Weil, Gotshal & Manges in the early 1990s--makes a reference to the character famously played by John Belushi in Animal House.

"Why don't you call me Blutarsky?" he asked Lynn. "You could do that too, I guess."

"I don't call you anything," Lynn replied. "I just want to get out of this case."

Contacted by The Am Law Daily, Lauria said the reference was to a previous case in which he served as debtor's counsel to Mirant Corporation it its Chapter 11 reorganization. Over the course of that trial, Lauria said, Lynn mentioned multiple times that "he didn't like food fights," and Lauria took the July 9 meeting in the judge's chambers during the Rangers proceedings as an opportunity to recall those past comments.

"This was one of my initial appearances in the case and it was my little way of saying that I might be starting a food fight," Lauria said, laughing. "So, I was talking to him in code from our previous case." 

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