The Grays were owned by businessman Walter Newman Haldeman, owner and publisher of the Louisville Courier-Journal newspaper.
The team was in first place in August 1877, then suddenly lost seven games and tied one against the Boston Red Stockings and Hartford Dark Blues.
A Courier-Journal story questioning the team's conduct was written by John Haldeman, the owner's son.
League president William Hulbert investigated and ordered players to authorize Western Union to release all telegrams sent or received during the 1877 season.
The telegrams indicated that pitcher Jim Devlin, left fielder George Hall, and utility player Al Nichols intentionally lost games in exchange for money.