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Drayton McLane

More on the Abbott-Duntsch connection

The Observer advances the ball.

Dr. Christopher Duntsch

How immune are hospitals? Under the current law, for Baylor to be liable for Duntsch’s mistakes, the plaintiffs have to prove that hospital administrators let him operate because they specifically intended to harm patients.

Soon after the three plaintiffs sued, Abbott’s office announced that it would be jumping in to defend the statute that shielded Baylor. In statements at the time, the attorney general’s office was clear: Abbott wasn’t defending Baylor or Duntsch. He was simply defending state law.

Earlier this week, Wayne Slater at the Dallas Morning News suggested that Abbott may have had other incentives to intervene. In June 2013 and January 2014 Abbott received two large donations to his gubernatorial campaign—$100,000 and $250,000 respectively—from one Drayton McLane, a Temple transportation exec and Republican who is also the chairman of the the board of trustees for Baylor Scott & White, the company that owns the Baylor hospital system.

The timing is a little suspicious. The $100,000 donation came the day after the Texas Medical Board suspended Duntsch’s license, ending an 18-month surgical career that had left two dead and many more paralyzed or in chronic pain. The $250,000 donation came the week after the second of the three lawsuits.

McLane has given Abbott money before, but it’s generally been much less; the most he had given in the past, according to the campaign filings the Morning News references, was $25,000.

See here for prior posts on Dr. Duntsch, and here for the DMN story on which the Observer piece is based. By the way, I can only presume that Observer author Saul Eblein is not a baseball fan or else he might have recognized Drayton McLane as the former owner of the Houston Astros. McLane, who gave more to Abbott in that one fell swoop than he had to Rick Perry in a dozen years, insists there was nothing fishy about the donation, its size, its timing, or Abbott’s subsequent defense of Duntsch. And we should believe him because that’s how people like Drayton McLane got to be where they are in the world today, by tossing their money around indiscriminately without even a passing thought to the possible return on investment. I’m sure Greg Abbott won’t treat him or the things he values any differently than he’d treat any other rich Republican donor. They’re all equals in his eyes.

Crane sues McLane

This ought to be fun.

Jim Crane’s Astros ownership group filed a state court lawsuit Thursday against former Astros owner Drayton McLane, Comcast and NBC Universal, accusing them of fraud and civil conspiracy and accusing McLane’s corporation that owned the Astros of breach of contract in conjunction with Crane’s 2011 purchase of a 46 percent interest in the parent company of Comcast SportsNet Houston.

The suit accuses McLane, who sold the Astros and his CSN Houston share to Crane in 2011 for $615 million, of selling “an asset (the network) they knew at the time to be overpriced and broken.” It also says Crane was “duped” when he bought McLane’s network interest based on what have been proved to be “knowing misrepresentations” and “falsely inflated subscription rates.”

“Ultimately, fans of the Houston Astros have been injured because defendants’ misrepresentations leave (Crane) with an impossible choice: accept the broken network as is and deprive thousands of fans the ability to watch Houston Astros games on their televisions, or distribute the game at market rates and take massive losses out of the Houston Astros player payroll – thereby dooming the franchise for years to come,” the suit adds.

[…]

Crane’s suit alleges McLane and Rockets owner Leslie Alexander demanded in 2010 that Comcast charge a base subscriber rate for CSN Houston in Zone 1 – the area around Houston where Astros and Rockets games can be seen – that Comcast said was too high. In fact, the suit said, the rate was so high Comcast feared it could not convince other distributors to carry the network.

Comcast eventually agreed to the inflated base rate, the suit said, in return for a most favored nation clause, which ensured Comcast it would always pay the lowest base rate of any distributor.

Faulty business plan

Crane, according to the suit, was not aware of these facts when he was negotiating to buy the team in 2011 and that Comcast, NBC Universal and McLane agreed to “conceal material information” about the network’s business plan.

The suit also accuses Jon Litner, group president of the NBC Sports Group, of making false and misleading claims the CSN Houston business plan was achievable, even though they were based on what the company knew were inflated subscriber rates.

Crane became aware of the 2010 demands by Alexander and McLane, according to the suit, during a December 2012 meeting in New York City, about a year after he bought the team and three months after the network launched.

The suit asks that McLane’s McLane Champions corporation be ordered to repay Crane’s group for losses that have resulted from alleged breaches of the group’s purchase agreement – including, presumably, more than $30 million in rights fees the Astros failed to receive in 2013 and what Crane says is the “artificially inflated price” he paid for McLane’s network share. Court testimony indicated CSN Houston was valued in 2010 at $700 million, with McLane’s share valued at $326 million.

I haven’t followed it here on the blog, but CSN Houston has been plagued with problems, mostly stemming from the fact that nobody other than Comcast carries it. That limits its reach to about 40% of Houston-area viewers, which also limits ratings and ad revenues. Mayor Parker has tried to facilitate talks between Comcast and other carriers to resolve this, but has had no luck. The infamous game nobody watched probably didn’t improve Crane’s mood about the station. The Astros have been trying to get out of this deal but aren’t on the same page as the Rockets, who are also stakeholders in CSN Houston. Four Comcast affiliates have filed for bankruptcy stemming from that action. It’s all a big mess, is what I’m saying. I have no idea what happens from here, but I’ll be watching. Sports Update and Hair Balls have more.

MLB approves Astros sale

It’s official.

Jim Crane’s $610 million purchase of the Astros from Drayton McLane was unanimously approved by Major League Baseball’s owners this morning.

All that remains is a formal closing of the transaction, which likely will take place early next week. At that point, McLane’s 19-year ownership of the club will end.

As we know, this not only means that the Astros will be changing leagues, but that the MLB playoff format will change as well.

Two wild card teams will be added to Major League Baseball’s playoffs no later than 2013, the same year the Houston Astros will begin play in the American League.

Commissioner Bud Selig announced Thursday that baseball’s owners unanimously approved Jim Crane as the Houston Astros’ owner. As part of his agreement to buy the club, Crane will shift the Astros to the AL after 2012, creating two 15-team leagues.

“It’s a historical day,” said Selig, whose new format ensures that an interleague game will be contested “from opening day on.”

Selig did not offer specifics on the schedule or playoff format, but said his committee for on-field matters favors the one-game playoff among wild-card teams in each league, saying it would be “dramatic.” The additional wild cards could be added for the 2012 season, but will be in place by 2013 for sure.

I’m not a hidebound traditionalist by any means, but count me among those who thought the current system, which as noted before produced two of the most compelling playoff races we’ve seen in a long time, was working just fine and didn’t need any further tweaking. But never let it be said that MLB and Beelzebub Selig are letting moss grow on them.

A potentially troublesome, or at least potentially hilarious, side item here has to do with the Astros’ lease at Minute Maid Park.

An Astros move to the American League could violate the team’s lease agreement with the Harris County Houston Sports Authority, according to a local attorney.

Kevin W. Yankowsky, a partner at Fulbright & Jaworski L.L.P., outlined his findings from a review of the lease in a Tuesday letter to J. Kent Friedman, the Sports Authority’s chairman of the board.

Yankowsky, an Astros fan since the 1970s, will make a presentation at the Dec. 1 Sports Authority Board of Directors meeting urging a strict enforcement of the Astros’ lease to play their home games at Minute Maid Park. The wording of the lease agreement, Yankowsky said, spells out that the Astros cannot play at Minute Maid as anything but a National League team without receiving prior consent from the Sports Authority.

[…]

“My position would be: (The Sports Authority) simply ought to refuse to renegotiate their lease,” Yankowsky said. “All they have to do is stand on their rights and let Major League Baseball know that come 2013 they intend to stand on their right. Then it’s up to baseball.

“Baseball can either sue the Sports Authority or give in. The Sports Authority doesn’t have to sue anybody. They can sit back and say, ‘We’ve got a valid lease, and this is what it says, and we’re going to enforce it.’ ”

Citing provisions from a 2000 agreement that expires at the end of 2029, Yankowsky said the terms spell out that the home team — the Astros — be a National League franchise.

[…]

“In the simplest form, what this means, in my judgment, is come opening day of 2013, the Sports Authority can refuse to let them play because it’s not a permitted use of the stadium,” Yankowsky said. “They can quite simply lock the doors and say, ‘No, it’s not a permitted use.’ The play of Major League Baseball games, by definition, are limited to games in which a National League team is the home team.”

Friedman called it “an interesting analysis” and said he has asked the Sports Authority attorneys to review the matter.

“We’ll take a hard look at it,” Friedman said. “If there is a legitimate legal position to be taken by the Sports Authority that benefits the community, we ought to take it. If it’s a stretch or if it’s something that ultimately doesn’t benefit the community, then that’s not what we should be doing. But that’s easy to say. How to sort through all that remains to be seen.”

While I applaud the outside-the-box thinking here, I have a hard time seeing this as anything more than a minor annoyance for MLB and the ‘Stros. Let’s be honest, this is the sort of problem (if it really is one) that is solved by whacking it with a checkbook until it dies. There’s a negotiated settlement in someone’s future, if it comes to that. I hope I’m misunderestimating Attorney Yankowsky’s interpretive skills, because I love me some misdirected chaos, but I’m not holding out much hope. Greg has more.

Astros almost to the AL

It’s happening.

Prospective Astros owner Jim Crane and his group of investors have reached an agreement with Major League Baseball that would shift the franchise to the American League, two people with knowledge of the situation confirmed Friday.

One person familiar with the situation said the transfer of the team from Drayton McLane to Crane is on the agenda at next week’s owners meetings in Milwaukee, but negotiations over the final details likely will continue until then. The Associated Press, citing two people who spoke on condition of anonymity, also reports the sale is on the owners’ agenda and that part of the sale agreement would involve the Astros moving to the AL effective in 2013.

The AL agreement would appear to be the final hurdle for Crane to close a deal he and McLane announced May 16. The Chronicle reported Nov. 4 that the $680 million purchase appeared to be headed for approval Thursday, with the AL negotiations being one of the final sticking points. The Astros have been in the National League since 1962 and the Central Division since 1994.

Spokespersons for Crane and MLB declined comment.

“If it’s on the agenda, then the deal is done,” one person with knowledge of the situation said.

“They usually don’t get this far unless it’s something that’s going to be acted on,” another person with knowledge of the situation said.

Assuming no further delays, it ought to be made official this week. I still don’t understand why anyone wants to have an odd number of teams in each league, and I don’t understand why I haven’t seen more about how this will drastically affect scheduling. I guess we’ll know more soon.

Astros sold

With everything else that’s been going on I’ve only been peripherally aware of the ongoing sale of the Astros to a new owner, which is now official.

Jim Crane stood behind the microphone Monday afternoon at Minute Maid Park, in his first moments as the new owner-to-be of the Astros, and spoke from his heart about dreams coming true, of his love for baseball and of his determination to produce a winning product for Houston fans.

And then Crane headed to his seat, only to be hooked back to center stage, with evident glee, by outgoing owner Drayton McLane.

“Don’t leave,” McLane said. “You’re just getting started. You’re just beginning, but this is the fun part right here.”

If he didn’t know it, that was Crane’s first hint that life in Major League Baseball will be considerably more high-profile than his role over the past three decades as broker of supply chain services for business and industry.

Crane, 57, had few specific answers for Astros fans because he will not take the keys to the franchise until the $680 million acquisition is approved by MLB owners. But he indicated he will apply the lessons he learned as a pitcher at the University of Central Missouri in the 1970s and as the founder of two successful companies, most recently Houston-based Crane Worldwide Logistics.

“Baseball teaches you a lot of values, and I tried to use a lot of those values, especially in how we ran the business,” he said. “We try to operate as a team. We weren’t afraid to work harder, harder than the other guys, and we stay persistent. The harder you work, the luckier you get.”

Welcome aboard, Jim Crane, and best of luck getting the Astros’ ship pointed in the right direction again. My guess is that we’re looking at three to five years minimum, given the still-barren (though better than it was) nature of the farm system. Hope the honeymoon lasts long enough to tide him over till then.

As for outgoing owner Drayton McLane, I think Sean Pendergast summed up his tenure pretty well. Let’s just say that I hope Crane builds on the good things, of which there were quite a few, and leave it at that.

RIP, Sister Damian Kuhn

This is the sweetest story you’ll read all week.

One spring season when the Astros were in a particularly bad slump, Sister Damian Kuhn made her way to owner Drayton McLane’s office, dressed in her traditional blue habit and veil.

“She was our No. 1 fan, and she always took it personal,” recalled McLane. He told her it was time to start praying.

After a long sigh, she replied, “Drayton, my knees are bloodied. It’s going to take more than that!”

Now McLane and the baseball team’s players are struggling over a different loss — the death of Sister Kuhn on Monday, just months shy of her 90th birthday.

She, as a good Roman Catholic, and McLane, as a good Baptist, connected after he noticed the nun’s unabashed enthusiasm for the team whenever she managed to snare a ticket for a game at the Astrodome that otherwise would have gone unused.

“She was hard to miss in a crowd,” McLane said, since her head was covered with a habit instead of a ball cap.

Thinking it was unbecoming for a nun to shout, she once told the Houston Chronicle that she tried hard to just clap and give high-fives. She never jeered or heckled, and always believed that next crack of the bat might be an Astros’ home run.

It just tickles me that she thought shouting was unbecoming, but high fives were okay. Not that I’m arguing with a nun, mind you – I’m a good Catholic boy, I know better than that. Go read the whole thing, you’ll be glad you did. Rest in peace, Sister Damian.