The Ongoing Coyotes Sale Thread

[Cowperson]

The lawsuit would revolve around Goldwater attorney Carrie Ann Sitren's letters to bond rating agencies and underwriters in January notifying them that Goldwater was looking into potential litigation to block the city's agreement, sources knowledgeable about the deal said.

The letters said Goldwater had not made a final decision but that Glendale's deal could amount to an illegal government subsidy of private business.

Glendale is expected to argue the letters represented an unlawful interference in the business affairs of the city, also known as tortious interference.

http://www.azcentral.com/community/g...-suit0306.html

Wooot!!!!

Hit the nail right on the head with tortius Interference.

I love when that happens.

Interesting its the same hammer = tortious interference - Glendale was going to use on Jim Balsillie and now they're pulling it out once again.

Tortious interference with business relationships occurs where the tortfeasor acts to prevent the plaintiff from successfully establishing or maintaining business relationships. This tort may occur when a first party's conduct intentionally causes a second party not to enter into a business relationship with a third party that otherwise would probably have occurred.

http://en.wikipedia.org/wiki/Tortious_interference

Publicly saying you think a deal is crappy - which is the right of anyone - is a different thing than Goldwater's rather deliberate and direct threats aimed at influencing potential buyers.

Did they go too far?

There's a lot on the line for Goldwater and its principal partners. I would find it pretty unlikely the primary people at Goldwater are actually insured against loss for this kind of thing. They are, after all, an agency that goes out of its way to look for trouble, actively suing institutions and expecting to be counter-sued. Not many insurance companies would logically want to be a part of that. I would think but just guessing.

Love it.

Cowperson

[troutman]

Originally Posted by Resolute 14

Sure, except that Glendale would be left with a lot of debt on an arena and no real way to pay it down without a major tenant, so there does appear to be legitimate damages for the city if the team leaves.

The argument would be that is their own fault. Not a wise idea to build an arena in suburban Phoenix, and expect pro hockey will fill the seats.

Also, could they not mitigate damages by attracting other tenants? An AHL team, NCAA, the Suns, concerts etc.

Cowperson could speak better to this - economic damages are difficult to estimate, if they even exist at all.

Here Coyote staffers and Glendale businessmen speak about the importance of the Coyotes:

http://www.azcentral.com/community/g...onference.html

http://www.azcentral.com/community/g...arena0303.html

The lawsuit:

http://www.azcentral.com/community/g...-suit0306.html

Glendale is expected to argue the letters represented an unlawful interference in the business affairs of the city, also known as tortious interference.

If a suit went forward, Goldwater might argue its right to free speech protects its actions, sources said.

The city has been at odds with Goldwater for close to two years. Goldwater sued Glendale in 2009, after the city began negotiating with potential buyers of the then-bankrupt team, to gain access to public records of those discussions. That lawsuit is ongoing.

Can the NHL await further litigation that can drag on for years? For immediate progress, GWI must back down, Hulsizer must buy the team privately with his own financing, or a Judge must quickly render a decision on the issue of the legality of the bonds.

[troutman]

The Free Press is advising WIN to temper expectations:

http://www.winnipegfreepress.com/bre...117507898.html

There will not be any announcement at Portage and Main this week to reveal news that the NHL is returning to Winnipeg.

If you're hoping for that — stop. You'll only be disappointed.

There is, however, a chance that the NHL will determine it has exhausted all avenues to keep the Phoenix Coyotes in Arizona and begin to look at other options.

Lawsuits are beginning to stack up while Bettman spins his Rolodex looking for risk-taking financiers. Media across the country are split on the issue -- some say Bettman will get a deal in Arizona while others say he's already looking for an exit strategy.

The next 48 hours should be telling.

No one can say for certain how this will all end but thankfully for all involved, and that includes Winnipeg hockey fans, resolution appears imminent.

One way or another.

[troutman]

Brunt on Monday:

Are Winnipeg’s NHL prayers about to be answered?
http://www.theglobeandmail.com/sport...rticle1931713/

The Glendale politicians, who must be right up there with the most obtuse in North America, opted to gamble that there would be no 11th-hour intervention. They had legal opinions to back up their claim that the arrangement with Hulsizer was legal, although if you read the actual bond offering, you learn that those opinions are predicated on the veracity of consultants’ reports about potential parking revenues. But the politicians’ core belief must have been that when push came to shove and a deal seemed imminent, Goldwater would simply walk away.

That’s a bad bet to make when you’re playing against zealots.

So all that’s left is the bleating, and some fabricated estimates of the economic impact of losing the Coyotes. ($500-million? Come on. Even the folks in the business of spinning crazy numbers to try to justify crazy public investment in sport with bogus multiplier effects would have a hard time coming up with a number like that based on a hockey team that plays 41 sparsely attended regular-season home games a year.)

The lawsuit, if it is indeed ever filed, is going to take time, and it’s going to be messy, and neither time nor mess are things the NHL governors can tolerate any longer without having to again reach into their own pockets. So anywhere NHL hockey was being played this past weekend, the chatter among reporters and agents and team officials was that the announcement of the Coyotes’ relocation to Winnipeg was both inevitable and imminent.

(The NHL jumped through hoops to block a guy who would have overpaid for the Coyotes (or the Predators, or the Pens) and written Glendale a cheque for $50-million)

[troutman]

Is Winnipeg a viable NHL market?
http://www.theglobeandmail.com/sport...rticle1932402/

ROY MACGREGOR
Of course it will work.

ALLAN MAKI
Winnipeg may have issues long-term

ERIC DUHATSCHEK
Winnipeg is well-positioned now to survive and even succeed in the NHL, but much of its long-term viability will depend upon two factors [CDN $, CBA]

SEAN GORDON
Tough for Winnipeg to make a go of it over a 20-year horizon

DAVID SHOALTS
At this point, the best you can say is Winnipeg will be a better NHL market than Phoenix or Atlanta. The long-term prospects are rather blurry for several reasons . . . Thus it comes down to the willingness of the owners to write cheques every year to pay for the losses rather than try to squeeze it out of the local yokels. Here is where Winnipeg has it all over a lot of NHL cities, so in the end I must agree, it will work as an NHL market.

[troutman]

Let's see what people are saying today.

Matthew Hulsizer running out of patience with Coyotes
http://www.theglobeandmail.com/sport...rticle1933174/

The city of Glendale, Ariz., has decided not to take any legal action against the Goldwater Institute for now, according to a source, but Matthew Hulsizer says other NHL teams are beckoning and he cannot wait much longer to complete his purchase of the Phoenix Coyotes.

“We have been approached by other teams, yes,” Hulsizer said, adding that he is not pursuing that interest “right now because we love Arizona.”

However, even though the NHL has not put a squeeze on the sale by imposing a deadline, Hulsizer said he needs to have the municipal bonds on the market soon.

Some NHL governors said in an informal survey that the NHL could wait as long as its entry draft on June 24 and 25 before deciding to leave Phoenix in order to facilitate a move for next season. But Hulsizer is not prepared to wait that long.

Some close to the situation feel that if Glendale proceeds with legal action against Goldwater it will set off a legal battle that would doom any hope of keeping the Coyotes in Arizona. “If they file, bring in the moving vans,” one source said

There are signs the NHL is looking at Winnipeg. A report by CBC.ca said the league commissioned studies of the Winnipeg market that estimated a team in the MTS Centre, which seats 15,015 people, would bring in around $70-million in a season, which is about double what the Coyotes earn at Jobing.com Arena. However, the report said this would be the lowest revenue of the six current Canadian teams.

[troutman]

Bettman, Daly headed to Phoenix
http://www.winnipegfreepress.com/bre...117582273.html

It is unknown whether the two are heading to try and make a last-ditch effort to save the Phoenix Coyotes or to inform the City of Glendale the NHL will begin exploring other options for the league-owned franchise.

[transplant99]

Interesting.

I have to believe that should the NHL decide they have had it with the nonsense in Phoenix, that the Coyotes will indeed head to Winnipeg ahead of the Thrashers as the BOG will not want to fund the team for another year.

That may truly lead to a contracted Atlanta team..something unfathomable just a few weeks ago.

Though KC has the arena at the ready, I am not sure they have a viable owner at this point as the AEG group needs to disconnect from LA I believe before anything there can be discussed....though i may be wrong on that.

[afc wimbledon]

Well I took a look at the MTS center website, seeing as it looks increasingly likely to be where they will be playing, I suppose they could be looking at doing a BC Place and take the roof off to go up an extra 50 feet.

[transplant99]

Originally Posted by afc wimbledon

Well I took a look at the MTS center website, seeing as it looks increasingly likely to be where they will be playing, I suppose they could be looking at doing a BC Place and take the roof off to go up an extra 50 feet.

Why would they do that?

[Iggy3x]

Would the NHL be more interested to sell the Coyotes to the Winnipeg group and then step in to help (i.e. purchase) the Atlanta team and wait for another prospect owner to purchase and relocate the Thrashers to Kansas City, Quebec or even Hamilton? What is the situation like in Atlanta?

I would imagine the NHL may elect to keep the Coyotes in Phoenix and work out an extension with Glendale on the current arrangement if the sale fails rather than starting a similar fiasco in Atlanta. Unless the NHL is just sick of dealing with Glendale.

[transplant99]

Originally Posted by Iggy3x

Would the NHL be more interested to sell the Coyotes to the Winnipeg group and then step in to help (i.e. purchase) the Atlanta team and wait for another prospect owner to purchase and relocate the Thrashers to Kansas City, Quebec or even Hamilton? What is the situation like in Atlanta?

I would imagine the NHL may elect to keep the Coyotes in Phoenix and work out an extension with Glendale on the current arrangement if the sale fails rather than starting a similar fiasco in Atlanta. Unless the NHL is just sick of dealing with Glendale.

Very very bleak. Its Phoenix all over again actually, but the current ownership group is just as likely to walk away as sell (unlike the Ballsillie debacle) if it comes to that.

The fact that Daly and Bettman are heading to Phx personally is pretty telling. I suspect we have an idea of what is going to happen by weeks end.

[afc wimbledon]

Originally Posted by transplant99

Why would they do that?

Because in the end if hockey is to work in the Peg it has to draw the same as other markets, they can survive with league help and a deep pocketed owner for a decade or so, but in the end they will need a new arena or some plan to get an extra 3,000 seats or so in the 'old' one.

[troutman]

Originally Posted by afc wimbledon

Because in the end if hockey is to work in the Peg it has to draw the same as other markets, they can survive with league help and a deep pocketed owner for a decade or so, but in the end they will need a new arena or some plan to get an extra 3,000 seats or so in the 'old' one.

I think the WIN ownership group has said they PREFER the smaller arena. They can charge more for tickets and keep demand for tickets high.

[Street Pharmacist]

Originally Posted by troutman;3004034
[I

“We have been approached by other teams, yes,” Hulsizer said, adding that he is not pursuing that interest “right now because we love Arizona.” [/I]

Originally Posted by transplant99

Interesting.

I have to believe that should the NHL decide they have had it with the nonsense in Phoenix, that the Coyotes will indeed head to Winnipeg ahead of the Thrashers as the BOG will not want to fund the team for another year.

That may truly lead to a contracted Atlanta team..something unfathomable just a few weeks ago.

Though KC has the arena at the ready, I am not sure they have a viable owner at this point as the AEG group needs to disconnect from LA I believe before anything there can be discussed....though i may be wrong on that.

Maybe?

[transplant99]

Originally Posted by afc wimbledon

Because in the end if hockey is to work in the Peg it has to draw the same as other markets, they can survive with league help and a deep pocketed owner for a decade or so, but in the end they will need a new arena or some plan to get an extra 3,000 seats or so in the 'old' one.

From what I understand...seating isnt the primary issue. Its the luxury suites, thats where they will lag behind so many others.

On top of that, they need to sell what they have now before even thinking about putting more money into this arena.

[transplant99]

Originally Posted by Street Pharmacist

Maybe?

Perhaps. Just dont think anyone wants that market right now.

[ricardodw]

Originally Posted by afc wimbledon

Because in the end if hockey is to work in the Peg it has to draw the same as other markets, they can survive with league help and a deep pocketed owner for a decade or so, but in the end they will need a new arena or some plan to get an extra 3,000 seats or so in the 'old' one.

3000 seats at $20 seat is 60,000 /game - 50 games/year is 3M per season in revenue.

That is assuming that these seats will all be sold out for every game at $20.

If there are not 100% sell out these cheap seat will be sold instead of the $60 seats and money will be lost.

If it cost any more than $20M to build the extra 3000 seats the money will never be recouped. If the government were to float a grant for the $20M then it becomes a great idea for owners, but they would rather the $20m be in cash or in lieu of taxes.

[valo403]

Originally Posted by transplant99

Interesting.

I have to believe that should the NHL decide they have had it with the nonsense in Phoenix, that the Coyotes will indeed head to Winnipeg ahead of the Thrashers as the BOG will not want to fund the team for another year.

That may truly lead to a contracted Atlanta team..something unfathomable just a few weeks ago.

Though KC has the arena at the ready, I am not sure they have a viable owner at this point as the AEG group needs to disconnect from LA I believe before anything there can be discussed....though i may be wrong on that.

I really don't see contraction happening, the reprecussions of that could be huge. It's just something that doesn't happen in modern day professional sports in North America, and taking that step would certainly be a massive blow to a number of revenue streams such as television contracts. A league that's contracting teams is not a league that you're going to see broadcasters and advertisers looking to work worth, the red flags are just too scary to risk it.

I'd expect that if it came right down to it the league would either operate the team in Atlanta as they did in Phoenix, or they'd make the move to KC and waive any issues with AEG having interests in two markets.

[ricardodw]

Originally Posted by transplant99

Interesting.

I have to believe that should the NHL decide they have had it with the nonsense in Phoenix, that the Coyotes will indeed head to Winnipeg ahead of the Thrashers as the BOG will not want to fund the team for another year.

That may truly lead to a contracted Atlanta team..something unfathomable just a few weeks ago.

Though KC has the arena at the ready, I am not sure they have a viable owner at this point as the AEG group needs to disconnect from LA I believe before anything there can be discussed....though i may be wrong on that.

The owners in Winnipeg are not fools and are making a profit without the NHL. They have time on their side. The purchase price of Phoenix has to be dropping every day as Atlanta and other owners start to look at getting some money back on their investment by selling their team to Winnipeg.

The NHL BOG has to be looking at minimizing their loses and keep 30 franchises even if one sells for a below "Bettman market price". A contraction would knock a considerable amount off the value of their asset. Depending on how it is being financed they may have to actually put in more cash to secure their current loans if their equity drops. Bettman is like a Realtor who is telling the owners not to panic, that their franchise fee is still worth the $200M he said it was before 30% of the neighborhood ran into financial problems.

Winnipeg is in a buyers market right now.