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Balsillie/Phoenix part II

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Old
05-07-2009, 11:28 PM
  #101
rj
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Originally Posted by gscarpenter2002 View Post
I cannot say whether the "express understanding" was oral or written.
If it was oral they're really stupid.

Although how can you write down in a legal document a person retains his ownership but only for show? You either own something or you don't. To me, ownership signifies whoever is responsible for paying the taxes for it. It reminds me of a friend that was heading for a divorce and so he "sold" his boat to his buddy for $10 so his ex wouldn't get it. When this was said in divorce court, the judge said go find him the tax records because his buddy paid property taxes on it if he owned it, otherwise he's guilty of tax evasion. The buddy said "uh...sorry, I'm not doing that" and the sale of the boat was revealed to be a sham and was included in the divorce settlement proceedings.

Since we just had tax submittal season not too long ago and considering the team's financial problems the taxes were probably submitted near the deadline after this loan was given by the NHL in February, who was legally responsible for paying the taxes for Coyotes Hockey, LLC, and had their name at the top of that paper filed to the Feds, the State of Arizona, and the City of Glendale? Was it the NHL or Moyes? That to me will ultimately answer the question, and I think it will for the bankruptcy judge as well.


Last edited by rj: 05-07-2009 at 11:36 PM.
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05-07-2009, 11:34 PM
  #102
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Originally Posted by Lard_Lad View Post
More than likely, but it's not terribly smart for the league to be trash-talking in the midst of what's becoming a significant PR problem for them. I have to wonder what non-fan parties - say, the CBC, or the Prime Minister - who've made sympathetic noises towards Balsillie think about the NHL suggesting they're on the wrong side of a "fight" the league plans to "end."
If i am the NHL, I could care less. They don't matter, plain and simple.

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05-07-2009, 11:39 PM
  #103
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Originally Posted by rj View Post
If it was oral they're really stupid.

Although how can you write down in a legal document a person retains his ownership but only for show? You either own something or you don't. To me, ownership signifies whoever is responsible for paying the taxes for it. It reminds me of a friend that was heading for a divorce and so he "sold" his boat to his buddy for $10 so his ex wouldn't get it. When this was said in divorce court, the judge said go find him the tax records because his buddy paid property taxes on it if he owned it, otherwise he's guilty of tax evasion. The buddy said "uh...sorry, I'm not doing that" and the sale of the boat was revealed to be a sham and was included in the divorce settlement proceedings.

Since we just had tax submittal season not too long ago and considering the team's financial problems the taxes were probably submitted near the deadline after this loan was given by the NHL in February, who was legally responsible for paying the taxes for Coyotes Hockey, LLC, and had their name at the top of that paper filed to the Feds, the State of Arizona, and the City of Glendale? Was it the NHL or Moyes? That to me will ultimately answer the question, and I think it will for the bankruptcy judge as well.
You are working from a common misperception with respect to the law concerning waiver of contractual rights and enforceability of oral modifications.

Your analogy is not apropos. This is a business transaction, not your buddy's boat deal. Mod: deleted.


Last edited by Fugu: 05-08-2009 at 09:40 AM. Reason: analogy soap box
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05-07-2009, 11:41 PM
  #104
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http://www.azcentral.com/sports/coyo...eshearing.html

AR Thursday night article.

Discusses who actually "owned" the team. Moyes claims all he gave up were voting rights.

And...
Quote:
Moyes said he had no choice but to file for Chapter 11 bankruptcy protection after failing for the past six months to get concessions from Glendale over the team's lease at Jobing.com Arena.

Glendale City Manager Ed Beasley said "there are no concessions" to be made.

Moyes also left open the opportunity of staying with the team as a minority investor if the proposed sale doesn't work.

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05-07-2009, 11:42 PM
  #105
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As much as I would love to see a team in Southern Ontario, I have to agree with what Bryden was saying in the Ottawa Citizen article. It's shortsighted of Canadian fans to support this kind of legal challenge to the rules that protect small market teams.

This is kind of like buying a Corvette when you know you cant afford it then going bankrupt and losing everything when you cant pay your bills anymore.

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05-07-2009, 11:44 PM
  #106
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http://www.nhl.com/ice/app?service=p...=290&iid=14171

Audio of the first few minutes of Bettman on NHL Hour discussing Phoenix Coyotes situation.

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05-07-2009, 11:46 PM
  #107
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Originally Posted by rj View Post
If you think the Coyotes are a sustainable team, show me how your team can just break even eventually, let alone make a profit, without further welfare checks from the league.
Again, the issue is not the Coyotes and whether they're a viable team in a viable market. It's who is to decide the answer to that question in the best interest of the NHL and its 30 franchises. The NHL or individual owners? The league argues it is its decision; Moyes and Balsillie are arguing against that opinion.

Quote:
Originally Posted by rj View Post
As far as Moyes, from the looks of it the Coyotes would've died some years ago if he didn't keep subsidizing it, so I don't see why you're blaming him for realizing he's pouring money down an unending hole and just wanting to stop. If you have the money, he'd be more than willing to sell it to you and then you can lose money on it.
Maybe, but we'll never know that will we? Money alone does not = success. Maybe he can run a trucking company, but he's certainly shown he can't run a hockey team. He made some bad business decisions, made some bad hires, and was responsible for putting an inferior product on the ice.

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05-07-2009, 11:47 PM
  #108
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http://vyous.com/sports/nhl/coyotes/...nsas-city-star

KC pundit writes that Coyotes woes does not mean they'll be heading to be new tenant in empty arena.

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05-07-2009, 11:59 PM
  #109
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I think if anything this brings up the discussion of how the league controls teams. What this highlights is there is a significant amount of support for putting a team in Southern Ontario, but the league keeps refusing on the basis it "isn't interested in expansion at the moment". I'm not saying let's switch to the so-called "wonderful" and "free" relegation system, where people can buy teams on whim but perhaps the way the league has distributed teams and how they control expansions is not sufficient.

That's a lot to mull over, but I'm just saying that the way things have gone, even if the team does stay in Phoenix you almost think they're taking a step back. Whoever ends up with this team inherits millions of dollars in debt and huge operating losses, a demoralized staff and a lot of angry casuals.

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05-08-2009, 12:07 AM
  #110
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http://vyous.com/sports/nhl/coyotes/...-national-post

With all his ties to California (90 minutes from Phoenix by plane where family lives/goes to school), National Post pundit wonders if Gretzky'll stay with franchise should it move to Canada.

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05-08-2009, 12:14 AM
  #111
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I thought he's already said he's not moving his family since they've settled down? Can't remember the link, might've been the Globe- anyone got a link?

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05-08-2009, 12:21 AM
  #112
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http://sports.theglobeandmail.com/se...oyotesnews0507

Balsillie et al also taking on MLSE in suit alleging NHL is illegal cartel, blocking sale/relocation.

Quote:
The group backing Canadian billionaire Jim Balsillie's bid for the Phoenix Coyotes unleashed its sharpest attack yet on the National Hockey League, alleging in a lawsuit that the league is operating like an “illegal cartel” by blocking Mr. Balsillie's effort to move the Coyotes to Hamilton.

“The NHL is excluding competition and restraining trade in [the United States and Canada] through the application of unreasonable restrictions in its constitution and bylaws, which are preventing the relocation of the Coyotes from Phoenix, Ariz., to Hamilton, Ont.,” said the lawsuit filed Thursday in Phoenix.

The suit also takes aim at Maple Leaf Sports and Entertainment, which owns the Toronto Maple Leafs, alleging it has colluded with the league for years to preserve “market power” in the Greater Toronto Area. Prohibiting relocation deprives hockey fans of “increased competition, lower prices, higher quality and more variety,” the suit alleged.

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05-08-2009, 12:25 AM
  #113
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http://sports.theglobeandmail.com/se...wspt-coyotes07

Balsillie taking on governors
Quote:
Balsillie's gamble is that enough NHL governors — 20 of the league's 30 clubs, a two-thirds majority, is needed to approve a franchise move — will love the fact that his $212.5-million (all currency U.S.) offer for the Coyotes will inflate the value of their franchises and therefore vote in favour of his wishes.

But NHL commissioner Gary Bettman is a formidable opponent, one who commands much loyalty among the old guard of the governors and some of the new as well, thanks to favours he has bestowed, such as playing hardball with investment bankers on behalf of some of the financially shaky franchises.

"What he's doing is not right," one NHL owner said of Balsillie's court showdown with Bettman and the NHL. "What's wrong is that the guy was getting to the point where people were warming up to him and then he goes and does this. Why? You've got to play by certain rules."
Quote:
One source says it became clear to Balsillie that the Leafs will demand upward of $800-million in return for dropping their objections to another team.
$800 million????? Wow.

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05-08-2009, 12:36 AM
  #114
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I think that was a misrepresentation of the oft quoted "$800m for a team in southern Ontario" figure.

This gets crazier by the minute.

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05-08-2009, 12:38 AM
  #115
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Originally Posted by LadyStanley View Post
http://sports.theglobeandmail.com/se...wspt-coyotes07

Balsillie taking on governors




$800 million????? Wow.
The board of Governors votes on how much the leafs get. The leafs can demand $800 billion, doesn't mean they're going to get all of it. They still only get one vote in 30.

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05-08-2009, 01:01 AM
  #116
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Originally Posted by cptjeff View Post
The board of Governors votes on how much the leafs get. The leafs can demand $800 billion, doesn't mean they're going to get all of it. They still only get one vote in 30.
I vote Ballsy has to give the Leafs $800 Billion - but, let's show we're not totally insensitive... make that $800 billion Canadian dollars.



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05-08-2009, 01:22 AM
  #117
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Originally Posted by cptjeff View Post
The board of Governors votes on how much the leafs get. The leafs can demand $800 billion, doesn't mean they're going to get all of it. They still only get one vote in 30.
Actually, they don't.

Any Territorial Rights Fees are purely up to negotiations between a new team and the Leafs & Sabres. The league may help mediate and maybe apply some indirect pressure, but that's it.

After an agreement (or possibly lack of one) is reached, then the relocation would be put to the BoG where only a simple majority would be needed (ie Toronto & Buffalo do NOT have veto power). However it is VERY unlikely that a majority of the BoG would vote to approve unless appropriate deals are worked out with Tor/Buff.

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05-08-2009, 02:44 AM
  #118
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Originally Posted by LadyStanley View Post
http://sports.theglobeandmail.com/se...oyotesnews0507

Balsillie et al also taking on MLSE in suit alleging NHL is illegal cartel, blocking sale/relocation.







Last edited by Artyukhin*: 05-08-2009 at 03:03 AM.
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05-08-2009, 03:22 AM
  #119
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Bettman rolled the dice, largely for appearances, and lost
http://www.theglobeandmail.com/servl...TPStory/Sports

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05-08-2009, 03:40 AM
  #120
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Originally Posted by doug mckenzie View Post
Bettman rolled the dice, largely for appearances, and lost
http://www.theglobeandmail.com/servl...TPStory/Sports
Goooooooood article

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05-08-2009, 04:32 AM
  #121
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Quote:
Originally Posted by doug mckenzie View Post
Bettman rolled the dice, largely for appearances, and lost
http://www.theglobeandmail.com/servl...TPStory/Sports
Hope the rest of the article is better researched than the research on Reinsdorf's ownership stakes.

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05-08-2009, 04:35 AM
  #122
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Quote:
Originally Posted by HockeyScholar View Post
Balsillie has the support of most Canadians. In fact he is using this as a sort of public image battle with Bettman and the NHL. He is overpaying by about $50 million for a franchise just so he can move it to his home. He has become a very polarizing figure indeed, most posts in this threads have either been strongly in favour or strongly opposed to him.
If all of his conditions are met, his offer is actually a vast underbid.

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05-08-2009, 04:40 AM
  #123
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The issues should be taken one at a time.

Issue #1 is whether Moyes had the authority and control to act on the part of the debtors/Coyotes/etc. (namely himself, his wife, entities they controlled and a family trust for the most part) as of the date of the Chapter 11 bankruptcy filing. If Moyes loses on this point to the NHL, the proceedings could end right there, subject to an appeal. So, that's the first issue to focus on.

It appears the memorandum/submissions so far on this issue can be found in these two links, the first by the NHL and the second by the Coyotes/Moyes:

http://media.thestar.topscms.com/acr...fddf53edca.pdf

http://media.thestar.topscms.com/acr...0044b52807.pdf

It is clear here that the Coyotes/Moyes team were more prepared in their arguments given that they were not surprised by the bankruptcy filing as was the NHL. It can be expected the NHL will have more to say on this issue in the coming days/weeks.

It also appears that the Coyotes/Moyes have an argument based on the wording of the proxy rights granted to the NHL, that amount according to Moyes, as mere “voting rights” according to the Coyotes/Moyes memorandum, which may not be interpreted as granting the NHL total control of the franchise or eliminating Moyes' ability to file for bankruptcy -- which may not be subject to any vote (or proxy vote for that matter) according to the various entities' operating agreements. The Coyotes/Moyes memorandum argues that such proxy rights, if granted to the NHL, did not preclude or prevent Moyes from taking the actions he did.

In my view, the Coyotes/Moyes will argue for a narrow or strict interpretation of the language of the operating agreements and any documents executed between Coyotes/Moyes and the NHL. The NHL will probably suggest a more expansive interpretation based on an “intent of the parties” theory. It is anyone's guess how these various arguments will play out without access to all the evidence, oral and written, at this time, but it's up to the court to decide on the most reasonable interpretation given all of the facts. In my mind, however, a strict rather than expansive interpretation could indeed be warranted given the sophistication of the parties, lawyers and law firms involved. However, to make any predictions at this point would be foolish.

Beyond the above initial key issue, there are still several others that could go either way if the litigation continues beyond that and it is by no means certain to me that Balsillie can succeed on all of them or on his final goal.

Keep in mind one important fact, though, the vast majority of lawsuits are settled out of court once certain key facts have been established or decided and the parties look out for and consider their respective interests and attempt to limit any fallout by negotiating a settlement to their mutual interest.

In the NHL's case, they, as well as the professional sports leagues in North America, may wish to avoid any court review or scrutiny of their constitutional documents and by-laws, etc., for example.

Just a few initial thoughts (without all the facts).

GHOST


Last edited by LadyStanley: 05-08-2009 at 08:18 PM. Reason: fix links
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Old
05-08-2009, 04:48 AM
  #124
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^Really interesting post. Great read. It's going to be a real interesting the next few weeks.

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Old
05-08-2009, 07:51 AM
  #125
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Originally Posted by gscarpenter2002 View Post
You are working from a common misperception with respect to the law concerning waiver of contractual rights and enforceability of oral modifications.

Your analogy is not apropos. This is a business transaction, not your buddy's boat deal.
Than Moyes would have a written waiver regarding his contractual rights that himself and the NHL agreed to. How can a court of law in a bankruptcy proceeding enforce an oral modification? I'm thinking it's very likely that we are going to have two different versions of what the oral modification was on May 19th, and thence this matter becomes a "he said, she said". The buddy's boat deal applies because it was an oral arrangement regarding transfer of ownership and a nominal sale price, therefore it was moonlighting as a business transaction. If I buy a Coke from the local gas station, that's a business transaction as well.

MOD Deleted:


Last edited by Fourier: 05-08-2009 at 09:55 AM. Reason: personal attack
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