Coyotes…& Other Scavengers. UPDATE!


It would appear, based upon a recent motion filed before the bankruptcy court, by Moyes lawyers, that Moyes too believes Reinsdorfs offer is in fact a gambit, not a legitimate bid.

As already discussed, Reinsdorfs “bid” requires an agreement with Glendale on a “new” lease agreement.  Until this has happened, Moyes will content Reinsdorfs bid is actually little more than a plan to make a bid, not an actual bid, as the court cannot order Glendale to accept a new lease agreement.

Balsillie, who’s “bid” also contains a caveat (relocation) could thus be considered equally legitimate, in fact, it could be argued that, because monies would be paid to Glendale if relocation took place, there is no actual caveat, rather a condition for payment, a condition the court CAN order.

If Reinsdorf is “sold” the team…well, there will exist no actual sale, unless he gets from Glendale the deal he wants.

Can a judge actually “sell” a franchise, but not get any money?

Seems bizarre to me.

Barring a new development, this ain’t over, not by a long shot.

It seems Bettman has won the battle.

Or has he?

Here’s the thing, Balsillie was already once approved, and according to tort law in the US, to impede legitimate pursuit of trade is illegal.

That will be the claim by Balsillie and his lawyers.

Character? they’ll say.  What about his character?  Because, as per article 35 of the NHL constitution, referencing ownership approval, this is the only element not deemed acceptable.

However, now that this matter is before the courts, it is the Judge that will be responsible for deeming Balsillie to lack the “character” to own an NHL franchise, not the present Governors/Owners.

Unfortunately for Jim, he’s fighting a bit of an apples and oranges battle.  One bid keeps the team in Phoenix, one does not.

Moyes, an unsecured creditor, is set to lose everything (hardly an example of the NHL looking out for it’s owners) if Reinsdorf is successful in his bid to purchase the Scavengers.  This classification diminishes Moyes standing in the court, when compared to the owners of Jobbing.com Arena..the city of Glendale.  It will be Glendale that will garner the greatest consideration.  So, let’s look at how the bids look in their eyes.

Make no mistake, Reinsdorf is not the “money” man, he’s the “front” man.  He is likely not investing much, if anything, in this bid, and he sure as hell isn’t going to be on the hook for any losses.

The fact is, Reinsdorf is involved in this for only one reason, to protect professional sports leagues rights to determine team ownership, and locations.

It isn’t about the NHL.

It isn’t about hockey.

It isn’t about Glendale.

It isn’t about the fans.

It’s about control, and the threat Balsillie’s actions represents to EVERY professional sports league, 2 of which (MLB, NBA) Reinsdorf owns franchises.

So all the city of Glendale cares is whether or not the Coyotes remain in Phoenix if Reinsdorf’s bit is successful, and at what cost to them.  They already know Balsillie’s offer is a disaster for them.

The fact is, spin not withstanding, the only way the Coyotes remain in Glendale is if they begin losing significantly less money, and that can only happen if the city of Glendale dramatically alters their lease agreement.

This is where it gets interesting.

The Reinsdorf deal may intend to remain in Phoenix, but it does not explicitly say that.  In fact, it does explicitly say the bid is contingent on a renegotiated lease agreement with Glendale.

Glendale city council, to this point, has been adamant that no renegotiation in regards to the Jobbing.com arena is possible.

If they do renegotiate the lease, they, the ELECTED councilors will be held responsible.  But, if say the team moves, well, that was beyond their control, right?

There is no appetite in Glendale, a city founded on real estate, to subsidise a hockey team, owned by millionaires, while their personal wealth is being hammered in the declining real estate market.

So while Balsillies bid openly desires a change in franchise location, the Reinsdorf bid surreptitiously provides for the same.  Neither provide a guarantee to the city of Glendale.

The fact remains that the NHL’s goals in all of this have remained fluid, at least publicly.

At one point it was about protecting franchise valuations.  Well, accepting a bid for >65M less hardly affirms this goal.

It was also, supposedly, about mitigating ownership losses.  Well, with Moyes set to lose over 300M, that seems to have hit the bricks too.

It was about protecting the fans.  But neither bid (Reinsdorf or Balsille) contain any guarantee of maintaining an NHL franchise in the region of Phoenix.  So much for that.

This is about power.

The power of the US based professional sports leagues to maintain control of their leagues.

The only player in all of this who could swing the tide is MLSE, but, considering Balsillies desire to hone in on their cash cow…well, let’s just say my enemies enemy is my friend…for now.

How will this all shake out?

Who knows, but without an actual agreement in hand with the city of Glendale, approved by the Reinsdorf group, I fail to see how the bankruptcy judge can view the Reinsdorf bid as anything but a concept…not a tangible offer, like Balsillies.

To approve Reinsdorf, in the absence of this necessary agreement, is to only delay paying of other creditors, as no monies will be paid until a deal with Glendale is finalized.  And it is far from a sure thing that a deal can be struck, considering the untenable situation that NHL hockey in Glendale represents, with or without a “cherry” arena deal.

The fact is, Glendale could bend over backwards, alienate themselves from their constituency, and still stand idly by as the Coyotes bolt to greener pastures.

So why not take the bird in the hand from Balsillie, blame the White Elephant of an arena on the NHL selling the city a bill of goods, and just put t to rest once and for all?

I guess that’s up to Reinsdorf, and what his group is willing to offer Glendale, and the bankruptcy judge.

But I’m no lawyer, so who really knows?

GN

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3 Responses to “Coyotes…& Other Scavengers. UPDATE!”

  1. my quess is that this is going to play out for another 2 years, nothing is going to accomplished. The team will not be sold and phoniex will continue to waste the NHLs money. and then one day, a group of investors from las vegas will enter the picture. They will place a bid of around 200m +more to help pay of the credits. Bettman will crap is pants cause hes so happy that he doesn’t have to return the jets to canada and the bid is accepted the same day.

    The team moves to Las Vegas for the 2011-2012 season and changes their name to the Las Vegas Blackjacks (i know, lame name)

    After 2 miserable seasons as the worst team in the league, a story from ESPN comes out accussing players from the Blackjacks of getting involved with organized crime. Some of the young players have gotten caught up in the night life of Las Vegas and started hanging around the wrong people. They in turn get caught with their pants down by the wrong people and are told to throw a couple game (their the worst team in the league,who is gunna care)

    After months a speculation, The players come clean and tell the world of what they have done.
    With the team a mess, the New Commisoner of the nhl, Scotty Bowman steps in and takes control over the team.

    a year later the Blackjacks are sold to Jim Balsillie and are approved for relocatoin, but not to hamition, but back to winnipeg, the rightfull owner to the franchise

    🙂

  2. haha Nick, nice. Best part is Scotty Bowman being the new commissioner

    I personally don’t see the Coyotes ever being a hockey team, I don’t understand why Gretzky part of this organization but it really breaks my heart. I think this is the owner who said he’s fire Gretz if he got ownership, so if this really happens I hope the Coyotes crash and burn beyond Butthead’s wildest dreams. I think Balsille will stay a pain the Butthead’s butt until he gets his hockey team, and I will enjoy every second of it

  3. What gets me is al those saying Balsillie should have just “played along”. That sounds great, but the fact was, “playing along” really meant “PAYING a-long (time)”.
    We’ve witnessed the NHL empty Moyes’ pockets, without batting an eye, and now, because he filed for bankruptcy, in hopes of covering his own ass, he’s painted as the greedy bastard.
    Balsillie had only 2 choices if he wanted to have a succesful franchise;
    1. Buy a team and be the next victim of Bettmans failed S. US plan, or
    2. Buck the “system”, follow legitimate legal channels, and, my oh my, attempt to develop an economically succesful NHL franchise.
    It truly is a credit to “spin” that so many have ignored the reality of the environment created by Bettman and his US based cronies to the extent that Balsillie is viewed as some sort of loose cannon.
    Think about it, if Balsillie’s a loose cannon, then the remainder of the Sens NOT demanding a trade are bad team players.
    It just doesn’t make any sense.
    GN

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