A little before 2 pm ET, The Tribune Company issued a statement that they have filed for bankruptcy. With the statement, came this weird note:
"The Chicago Cubs franchise, including Wrigley Field, is not included in the Chapter 11 filing. Efforts to monitize the Cubs and its related assets will continue."
Huh? How does a company file for bankruptcy and voluntarily take off some of its assets or subsidiaries? I certainly didn't think that was playing by the rules. Well, apparently I was wrong.
I spoke with Paul Rubin, a partner at Herrick Feinstein who is part of the bankruptcy group and has dealt with and consults with professional sports teams.
- Tribune Co. Files for Chapter 11 Bankruptcy
Rubin told me that a parent corporation can file for bankruptcy without the subsidiary filing. The point of doing this is to make it easier to sell the Cubs without all the rules associated with the bankruptcy court, including timely filings of financial information. Another bankruptcy lawyer friend of mine told me that it would also allow the Cubs employees, and anyone associated with dealing with the Cubs, to better operate on a "business as usual" basis.
This all does not mean, however, that the Cubs sale will be free from everything that goes on with the bankruptcy because the creditors will still get the proceeds from the sale of the team. And who knows what's going to happen with free agents? You think the court isn't going to get involved if the Cubs sign a big free agent like Jake Peavy or Bobby Abreu in the offseason?
Questions? Comments? SportsBiz@cnbc.com