The Dodger Saga
“I started out, of course, as a baseball fan,” said O’Malley. “I had season seats at Ebbets Field (‘I guess back in the days when we had maybe 100 season ticket holders’Walter O’Malley interview with Vin Scully for Union Oil record series, 1966) and I found that that was a great way of entertaining clients, active or potential. I used my seats quite effectively for that purpose. It became pretty generally known that you could find Walter O’Malley at a Dodger ballgame in Ebbets Field almost each night. From that, led my active association with the ballclub. I represented the Brooklyn Trust Company; the bank was a trustee of 50 percent of the Dodgers’ stock. The ballclub was badly involved in a mortgage they could not pay off and the President of the bank assigned me as a troubleshooter to step into the picture and see what could be done.
“So, I first went onto the Board of Directors of the Dodgers as a lawyer (in 1932), but actually representing the people who were trying to get some of their money out of the ballclub, the mortgage payments and the bank loan. It was about that time the economy of baseball turned the corner and the club started to do very well.”Walter O’Malley on KFI Radio with host Loren Peterson, 1965
Had the opportunity to join Brooklyn Trust Company, which specialized in post-Depression financing, not come into the picture, O’Malley once speculated that he might have become “a Supreme Court judge in Brooklyn.”Boston Globe, Sports Plus, July 28, 1978
O’Malley expanded his empire purchasing J.P. Duffy, a building supply company, as well as the successful New York Subways Advertising Company in 1950. He also became a sought-after director for the following: Brooklyn Borough Gas Company in 1932, Kingsbury Ordnance Plant in Indiana during World War II; Todd and Brown, Inc., supervisors of the building of New York’s Rockefeller Center and Virginia’s Old Williamsburg; and John F. Trommer Brewery, Inc.
But, since he was assigned to the Dodgers for legal issues and because the Brooklyn Dodgers were on the brink of bankruptcy, O’Malley was asked to join the club in 1943 and try to straighten out the mess. He made a bold career move, permanently leaving his successful New York law practice to join the Dodgers as their full-time Vice President and General Counsel. That led to O’Malley’s historic rise through the organization to owner. Formerly, the General Counsel position was held by U.S. presidential candidate Wendell L. Willkie, who penned the popular 1943 book, “One World,” suffered from ill health and died of a heart attack at age 52 on October 8, 1944.
At that time, though, no one could have predicted that O’Malley’s engineering and law background, plus his love of sporting activities, would thrust him to partial ownership of the Dodgers, one of the most storied teams in history.
But, that is exactly what happened. In a pair of transactions in 1944 and 1945, O’Malley, Dodger President Branch Rickey, plus John Lawrence Smith, then Vice President and later President of Charles A. Pfizer & Company (known for mass-producing penicillin, using fermentation technology), bought 75 percent of the shares of stock in the team. Smith had significant influence as he was one of the Brooklyn Trust Company’s stockholders and had big deposits sitting in the bank. Baseball executive Rickey, known for fathering the modern “farm system,” had been club president since 1942. The remaining 25 percent was held by Dearie McKeever Mulvey, the daughter of former Dodger President Steve McKeever. She was married to James Mulvey, who was President of Samuel Goldwyn Pictures, Inc. and a director of the Dodgers.
In the initial November 1, 1944 transaction, O’Malley joined with Rickey and Andrew Schmitz, a prominent Brooklyn insurance executive from McCooey and Schmitz, to purchase 25 percent of the stock from the Ed McKeever estate, of which Stephen A. Ryan was administrator. In the second transaction on August 13, 1945, O’Malley, Rickey and Smith purchased an additional 50 percent of the shares of stock after a nearly year-long effort, in an arrangement through the Brooklyn Trust Company, one of three executors of the Ebbets’ estate, along with Joseph A. Gilleaudeau and Grace Slade Ebbets, who had all willingly sold. Schmitz also agreed to relinquish his shares to the trio after the second stock transfer. Reportedly, the stock deals cost $240,000 for the first purchase and $800,000 for the second, meaning a total of $1,040,000 for 75 percent ownership.New York Times, August 14, 1945
“It was only a short step before I formed a syndicate to buy the outstanding stock that the bank represented and with that the stock,” said O’Malley. “We were then able to buy another 25 percent which gave us control of the ballclub. We reached a point where I found my association with the ballclub was just about as interesting as my law practice. I turned that over — my law practice— to my associates and I started to devote full-time to the ballclub.”Walter O’Malley on KFI Radio with host Loren Peterson, 1965
O’Malley signed an application on behalf of the Dodgers to the Federal Communications Commission requesting a new FM radio station, which would have been used for the play-by-play broadcasts of their games in February of 1948. The license would have been the first to be issued to a ballclub.
Already trying to look for a solution to the Ebbets Field situation, O’Malley wrote a letter on March 5, 1948 to thank famed architect Lorimer Rich for preparing drawings for the ballpark. Rich, who had graduated from Syracuse University, was the architect for numerous federal buildings, but is most famous for his design of the Tomb of the Unknown Soldier at Arlington National Cemetery in Virginia.
When a Boston Braves player broke his ankle at Ebbets Field and was rushed to a Brooklyn hospital in 1948, O’Malley went to see him. “I’ve always hated to see a ballplayer get hurt,” he said, “and I thought maybe I could cheer the fellow. Besides,” he smiled, “I’m a lawyer, you know. That makes it easy for me to chase ambulances.”Milton Richman, Provo, UT Herald, UPI story, November 26, 1951
He left his law practice, which he had built between 1933 and 1950, to reign over his beloved Dodgers at 215 Montague Street, the site of the ballclub’s offices.Vincent X. Flaherty, Los Angeles Examiner, February 28, 1957
Rickey’s contract as Dodger President was up for renewal in November 1950, but during their meetings the topic was never advanced by the board. Smith passed away on July 10, 1950, leaving his $4,000,000 estate, including his 25 percent Dodger stock, to his wife Mary Louise (May). The widow Smith and the Brooklyn Trust Company were named as co-executors. Due to the passing and funeral of their friend and partner Smith, O’Malley and Rickey were unable to attend the 1950 All-Star Game. O’Malley (with his 25 percent interest in the club) next bought controlling interest in the Dodgers.
In a complicated arrangement, O’Malley ended up paying $1,050,000 for Rickey’s one-quarter stock interest, which included an endorsed check of $50,000 from Rickey to real estate magnate William Zeckendorf’s company, Webb & Knapp, Inc. When he realized his days in power were numbered with the Dodgers, Rickey, through the suggestion of Pittsburgh Pirates’ owner John Galbreath, asked Zeckendorf to make a $1,050,000 bid for his stock, using this as leverage, knowing the O’Malley-Smith tandem had to match any offer or gain a new partner by their signed agreement. The whole Rickey ruse forced O’Malley’s hand to raise his initial offer for the stock by more than $600,000. Rickey used Zeckendorf’s name and bid to force O’Malley or Smith to pay the inflated price. In appreciation of tying up his one million dollars in the bidding process, Zeckendorf received a $50,000 endorsed check from Rickey. “I wrote two checks,” O’Malley said. “One for $50,000 and one for a million. The $50,000 check came back endorsed by Rickey to Zeckendorf.”Jack Mann, The Washington Star, Sports, August 10, 1979 O’Malley did pay, having felt taken by Rickey, but gained control of 50 percent of the Brooklyn Dodgers. Shortly thereafter, O’Malley took a purchase option on stock, which was retired by the Brooklyn club, once owned by Mrs. Smith to increase his holding to 66 2/3 percent. Stockholder James Mulvey also increased his family’s ownership from 25 percent to 33 1/3 percent.