"Pursuant to my authority as Commissioner, I informed Los Angeles Dodgers owner Frank McCourt today that I will appoint a representative to oversee all aspects of the business and the day-to-day operations of the Club," Selig said in a statement.
"I have taken this action because of my deep concerns regarding the finances and operations of the Dodgers and to protect the best interests of the Club, its great fans and all of Major League Baseball. My office will continue its thorough investigation into the operations and finances of the Dodgers and related entities during the period of Mr. McCourt's ownership. I will announce the name of my representative in the next several days.
"The Dodgers have been one of the most prestigious franchises in all of sports, and we owe it to their legion of loyal fans to ensure that this club is being operated properly now and will be guided appropriately in the future."
McCourt issued a brief statement late Wednesday night that read: "Major League Baseball sets strict financial guidelines which all 30 teams must follow. The Dodgers are in compliance with these guidelines. On this basis, it is hard to understand the Commissioner's action today."
In an e-mail message sent to Dodgers employees on Wednesday, McCourt said, "In light of the Commissioner's announcement today, I ask that you please continue to conduct business as usual with our complete dedication to the game and our loyal fans. Each of you has represented this organization with class, and while this is no doubt a challenging time for all of us, I truly appreciate your efforts."
McCourt, owner and chairman of the Dodgers, bought the club from News Corp. on Jan. 29, 2004, and the club reached the postseason in four of his seven seasons as owner.
However, the club's finances have come into question since his highly publicized divorce from Jamie McCourt, his wife of 29 years who also served as CEO of the club until 2009.
This season, while the club has struggled to reach .500 on the field, there have been media reports that McCourt's request to accept a $200 million advance in broadcasting revenues from FOX was rejected by the Commissioner. Last week it was reported that FOX directly loaned McCourt $30 million, which apparently was needed to make payroll.
Meanwhile, the franchise has been under intense scrutiny since an assault in the the Dodger Stadium parking lot on Opening Day that left a San Francisco Giants fan hospitalized in a medically induced coma.
In the wake of that incident, attendance has been significantly down, while the Los Angeles Police Department has made a highly visible presence, essentially taking over security at the park.
On Tuesday, McCourt announced the hiring of Los Angeles civic leader and developer Steve Soboroff as a vice chairman, with responsibilities including the enhancement of fan experience and the strengthening of ties to the community.
This is the third time in recent Major League Baseball history that the Commissioner's office has taken over operations of a club.
In the wake of contraction discussions after the 2001 season, MLB purchased the Montreal Expos from Jeffrey Loria and his partners for $120 million. In a three-way transaction, Loria purchased the Marlins from John Henry, and Henry led a group that bought the Red Sox from the Yawkey Estate.
At the time, MLB established a relocation committee with the express purpose of selling the Expos, moving the team from Montreal and negotiating the building of a new ballpark in the location city. MLB held ownership and operational control of the Expos for four and half years. The team was moved to Washington in 2005 and was sold to the Lerner Family in July 2006 for $450 million. The club moved into new Nationals Park in 2008.
The Texas Rangers were placed under operational control of MLB last year when Tom Hicks filed for Chapter 11 bankruptcy to try to force an already-agreed sale to a group headed by Chuck Greenberg and Nolan Ryan, the team's president. In the interim, Ryan essentially oversaw the day-to-day operations of the club with then MLB president Bob DuPuy heading negotiations to satisfy Hicks' creditors.
The situation was ultimately resolved in a bankruptcy court auction as Greenberg-Hicks outbid Dallas Mavericks owner Mark Cuban and bought the team for $550 million this past August.
Ken Gurnick is a reporter for MLB.com. Barry Bloom contributed to this report. This story was not subject to the approval of Major League Baseball or its clubs.