Investigative journalist Pablo Torre has brought to light a significant financial transaction involving Los Angeles Dodgers owner Mark Walter and Lakers Hall of Famer Magic Johnson, alleging potentially illicit dealings. Torre's investigation, detailed on his podcast "Pablo Torre Finds Out," focuses on a $350 million loan from Johnson's EquiTrust Life Insurance Company to a media company owned by Walter.
According to Torre and Sam Koppelman of Hunterbrook Media, the transaction involved EquiTrust, of which Johnson has been the majority owner since April 2014 after purchasing it from Walter. This deal reportedly became a substantial asset in Johnson's portfolio, contributing to his billionaire status in 2023. The core of Torre's allegation is that this transaction was not disclosed as an affiliate transaction, which has reportedly prompted federal authorities to investigate Walter's business dealings.
Torre connected this arrangement to the 2012 sale of the Dodgers to Walter. David Samson, former president of the Miami Marlins, stated on Torre's podcast that MLB owners were surprised by Walter's acquisition of the Dodgers, as he did not possess a significant sports empire at the time. Samson noted that Walter, alongside other bidders like Stan Kroenke and Steve Cohen, was in a similar price range for the team. However, Walter's bid ultimately exceeded $2 billion.
Samson explained that Walter's increased bid was reportedly facilitated by a deal with Major League Baseball that capped the amount of broadcast revenue subject to revenue sharing. This allowed the Dodgers to retain more money from their TV deal, essentially enabling Walter to finalize the purchase at a higher price. Torre highlighted that this deal with SportsNet LA, also owned by Walter through American Media Productions, was a key factor in his ability to buy the Dodgers for $2.5 billion.
Johnson also played a crucial role in negotiating the $8.35 billion, 25-year agreement with Time Warner Cable, the largest TV deal in sports history at the time. Torre suggested that an informal agreement may have been in place between Walter and Time Warner Cable even before the Dodgers' purchase. David Rone, then president of Time Warner Cable Sports, was later hired by Walter's Guggenheim group, where he now serves as a managing partner.
A representative for Guggenheim denied the allegations, stating in a released statement that the company and Walter have demonstrated no wrongdoing. The statement also asserted that affiliated transactions are common in the insurance industry and that there is no victim in this situation. Guggenheim is reportedly not looking to sell its sports assets, including the Los Angeles Dodgers, at distressed prices to raise capital for its insurance operations. Despite these denials, Walter remains under federal investigation.