10:24pm: Olney reports that the Rockies will not pursue Penny this season.
4:29pm: Olney notes that Penny can decline any waiver claim. This essentially gives him the chance to assure himself free agency. Becoming a free agent would mean forfeiting the chance to earn the incentives on his contract.
3:37pm: The Yankees claimed Brad Penny earlier in August, only to see the Red Sox pull him back, according to ESPN.com's Buster Olney.
3:19pm: Troy Renck of the Denver Post notes that it's becoming increasingly unlikely that the Rockies will add Brad Penny. Some people within the organization believe he'd help, but others are concerned that he would not fit it. Tracy Ringolsby of Inside the Rockies first reported that the Rockies weren't likely to add Penny this morning.
2:20pm: Joe Christensen of the Mineapolis Star-Tribune hears that the Twins would consider claiming Penny off release waivers and taking on the rest of his salary instead of waiting for him to become a free agent.
2:16pm: George A. King III of the New York Post hears that the Yankees have interest in Penny. The Yanks haven't heard anything to suggest Penny promised the Red Sox he wouldn't sign with an AL contender. Johnny Damon says he'd like the Yankees to add Penny.
1:16pm: ESPN.com's Buster Olney confirms that the Rockies, Giants and Marlins are interested in Penny. None of those teams are likely to claim him before Monday, because they would have to take on the remainder of his salary to do so. If they wait until Penny clears waivers, he'll cost less than $100k.
12:01pm: Ken Rosenthal of FOX Sports hears from one GM who believes Brad Penny "absolutely should go back to the National League" once he can sign with the team of his choice on Monday. "He's stupid if he stays in the AL," the GM adds.
Rosenthal says Penny makes sense for the Rockies, Giants and Marlins. The Dodgers could use him, but Rosenthal doubts Penny would re-join the team. Penny will cost less than $100k, because his incentives are negated once he's released.
And here's a roundup of the rumors we've already heard about Penny today: