Former basketball star Michael Jordan said MCI Inc., the second-largest U.S. long-distance telephone company, owed him $8 million for appearing in the company's ads.
Jordan, 42, signed a 10-year agreement in 1995 to appear in ads for the company, then known as WorldCom Inc. The five-time most valuable player of the National Basketball Assn. was to be paid $2 million a year, but WorldCom stopped paying him in 2002 when it filed for bankruptcy protection, according to papers filed in U.S. Bankruptcy Court in New York.
The company "failed to make the payment that was due on or before June 30, 2002, shortly before the filing of its bankruptcy petition," Jordan's lawyer Rosanne Matzat said in court papers.
WorldCom filed for bankruptcy protection in July 2002 after an $11-billion accounting fraud that led to criminal charges against former executives including Chief Executive Bernard J. Ebbers. The company exited bankruptcy protection in July renamed MCI, with headquarters in Ashburn, Va.
Though MCI came out of bankruptcy protection, the court still has authority to resolve disputed claims against the company.
Jordan is seeking $2-million payments owed to him from 2002 through 2005, Matzat said in court documents.
MCI is asking the court to throw out the claim. Under federal law, a company in bankruptcy protection can seek court permission to drop contracts.
MCI lawyer Mark Shaiken said in court papers that once MCI rejected the contract, Jordan was obligated to "mitigate his damages by obtaining suitable alternative employment" and that he had refused to do so.
Jordan, who retired from professional basketball in 2003, still earned $35 million through endorsements in 2004, according to Forbes magazine.