deluca67 Posted September 11, 2009 Report Posted September 11, 2009 Trial resumes today at 11:30am EDT. Two interesting developments: 1. The NHL has decided not to cross-examine Jim Balsillie, while Bettman will be put on the stand for questioning as planned. Not sure why the NHL opted for this, and Bettman himself was very evasive about the reasons. It seems to me that this really hurts the NHL's case, so I don't get it. 2. It was exposed yesterday that the NHL's own internal study revealed a Hamilton franchise would be among the five most valuable in the NHL. This certainly won't help convince the judge that relocation to Hamilton would be harmful to the organization's future. 3. Biz of Hockey Reports: The Mayor of Hamilton, Fred Eisenberger, wrote in a letter referenced in Thursday’s hearing, "I would like to assure the National Hockey League that the planning process for the renovation of Copps Coliseum is currently in progress and we are confident that a financing commitment for the project will be made by the appropriate levels of government in Canada in partnership with the City of Hamilton," adding, "We believe the Copps renovation plan is … well within the scope of available government funding programs." I'm really looking forward to Bettman taking the stand today. Part of me believes he is secretly rooting for the team to be liquidated by Judge Baum because otherwise he's stuck between a rock (Balsillie) and a hard place (MLSE) in a dispute that's pointing toward a massive antitrust war in which he'd be planted firmly in the crossfire. I still don't see how a Judge can tell a Corporation who they can sell a franchise to and where that franchise has to be located. The Phoenix Coyotes are 1/30 of a Corporation they are not a separate entity. Just like a McDonald's franchise the owner of the Coyotes only owned the rights to run that franchise in that location. I can see the Judge awarding those rights to highest bidder, that's one thing. To dictate that the NHL has to allow that franchise to move is clearly out of his jurisdiction. Either way, the franchise isn't going anywhere no matter what the judge decides. If he over steps his jurisdiction this will be tied up in appeals for a very long time.
end the curse Posted September 11, 2009 Report Posted September 11, 2009 You have articulated the NHL's position beautifully, DeLuca. Keep in mind, the other side to this is whether or not in Chapter 11 bankruptcy reorganization a judge can side with the desires of the league over the best interests of the creditors, debtors and organization as a whole. Essentially, if the judge agrees that the sale to Balsillie and subsequent relocation to Hamilton is in the best interests of the creditors and the future of the organization, while not putting an undue burden on the league, the league will probably lose this case. There are also some sticky matters regarding conflicts of interest and anti-trust that are involved, and the case as a whole is really, really complicated. I couldn't begin to predict how this will end, but I'm leaning against the NHL's case right now based on the comments from Judge Baum, and leaning towards either a ruling affirming the bid of Balsillie or simply liquidating the franchise.
... Posted September 11, 2009 Report Posted September 11, 2009 If Baum does not rule "in favor" of the NHL, then he'd have to go with liquidating the club. Otherwise, this has the potential to set a precedent where franchisees could take any corporation to court to get around the specific rules and parameters they contractually agreed to. And I'm sure there is a lot of prior law to refer to for that.
Foligno's Nose Posted September 11, 2009 Report Posted September 11, 2009 The effect it will have on Buffalo is that it significantly hurts their chance of expanding more into Southern Ontario, a market it has the rights too but has been struggling to expand in because they don't have a TV deal there. If Buffalo wants to grow financially, they need to expand more into Southern Ontario, which will be even tougher if they have another team to compete with and a smaller exclusive market north of the border Are you kidding me? The Sabres have been around since 1970. Since Golisano's ownership began, they still have not been able to get on TV in Southern Ontario. And expand more into Ontario? What has been stopping them so far? The sure way to get the most out of the proximity to Ontario is to put a winner on the ice. They will come. The existing southern Ontario fans will still come. There will be plenty of hockey fans to tap into with or without a Hamilton NHL franchise.
nfreeman Posted September 11, 2009 Report Posted September 11, 2009 If Baum does not rule "in favor" of the NHL, then he'd have to go with liquidating the club. Otherwise, this has the potential to set a precedent where franchisees could take any corporation to court to get around the specific rules and parameters they contractually agreed to. And I'm sure there is a lot of prior law to refer to for that. It might sound crazy, but bankruptcy courts more or less have the power to "rewrite" contracts in this manner. Their top priority is to obtain the greatest possible amount for the bankrupt entity's creditors. For example, bankruptcy courts have the ability to force lenders to a bankrupt borrower to take less than 100 cents on the dollar, and at different times (and in different forms -- e.g. they often have to take equity or different debt instruments) than were contractually agreed to with the borrower. This is why if Balsillie was determined to muscle his way in, bankruptcy court was the best way to do it. The judge's ruling, regardless of opinions being ventured here by those whose expertise seems to be based on watching "L.A. Law," is going to come down to what is best for the creditors. This is why it was another smart move by Balsillie to offer $50MM to Glendale, and why it's important that Glendale still prefers the NHL's bid to Balsillie's.
Foligno's Nose Posted September 11, 2009 Report Posted September 11, 2009 So, I'm not buying the idea of the area being able to support a third team - Quebec City could not. Not even a remote in-the-sticks town with nothing else to do like Winnipeg could handle having its own franchise. Just because it's a Canadian market - doesn't mean its a STRONG market - or a hockey market. http://en.wikipedia.org/wiki/Golden_horseshoe 8.1 million people. How many hockey fans per capita do you think there are in this region? It is completely saturated with hockey fans with or without dispensable incomes to spend on NHL tickets, swag, etc... to boost the already estimated 40% of all NHL revenue produced. It will not fail no matter how high the ticket prices are. A mortal lock. I hope they stop him - on principle alone, if for nothing else. The league has survived for a long-ass time and I think despite its Bettman's here and there, it knows what it's doing. The rules are there for a reason. It knows what it is doing??? Wow.
Foligno's Nose Posted September 11, 2009 Report Posted September 11, 2009 Didn't we just go through this sh*t with someone else? If you are disputing facts, then dispute the facts and provide evidence to back it up. Don't run off at the lip. It's easy, let me show you: http://en.wikipedia.org/wiki/Bankruptcy#United_States "In Chapter 11, the debtor retains ownership and control of its assets and is re-termed a debtor in possession ("DIP"). The debtor in possession runs the day to day operations of the business while creditors and the debtor work with the Bankruptcy Court in order to negotiate and complete a plan. Upon meeting certain requirements (e.g. fairness among creditors, priority of certain creditors) creditors are permitted to vote on the proposed plan. If a plan is confirmed the debtor will continue to operate and pay its debts under the terms of the confirmed plan. If a specified majority of creditors do not vote to confirm a plan, additional requirements may be imposed by the court in order to confirm the plan." Wasn't that easy? Now you know that under Chapter 11, the debtor retains ownership, but the creditors determine the business plan. Here, let me show you more: http://www.scribd.com/doc/14999927/Phoenix-Coyotes-Bankruptcy-Petition You have to scroll down to section B4 "Consolidated List of Creditors yada yada yada..." to see that when Moyes assigned himself as the first creditor, yet at the end of section B1 he signed as the debtor. Red flags should be going up because normally a debtor can not also be a creditor. Here! You participate: research "Dewey Ranch Hockey". Aaaahhhh... Oh, Wikipedia! The Great Mediator! God Bless Thee!
shrader Posted September 11, 2009 Report Posted September 11, 2009 And expand more into Ontario? What has been stopping them so far? Why did the Bills wait so long to go after Rochester hard? Things are never quite run the way they should be.
... Posted September 11, 2009 Report Posted September 11, 2009 It knows what it is doing??? Wow. Gee, the highly ambiguous, yet obnoxiously arrogant, "wow" response. "Wow" what? "Wow, I have hemorrhoids and they are hurting right now"? "Wow, I like fat chicks"? What does "wow" mean here?
spndnchz Posted September 11, 2009 Report Posted September 11, 2009 Wow WTFC anymore. Let's play hockey. Can we start the GDT 6 days early?
apuszczalowski Posted September 11, 2009 Report Posted September 11, 2009 Are you kidding me? The Sabres have been around since 1970. Since Golisano's ownership began, they still have not been able to get on TV in Southern Ontario. And expand more into Ontario? What has been stopping them so far? The sure way to get the most out of the proximity to Ontario is to put a winner on the ice. They will come. The existing southern Ontario fans will still come. There will be plenty of hockey fans to tap into with or without a Hamilton NHL franchise. They can't get a TV deal because there are no TV stations capable of broadcasting the Sabres located in Niagara, the closest is a station in Hamilton. They have tried to grow into the area, but without a TV deal, its really hard. I live 20 minutes accross the border, and from where I work, I can almost see the arena, yet I have to buy the centre Ice package to watch Sabres games. Putting a team in Hamilton will almost eliminate any chance of Buffalo getting a TV deal in southern Ontario. The problem hasn't been bringing existing fans from Canada into Buffalo, its expanding its fan base and bringing in more revenue from Niagara is whats necessary
henysgol Posted September 12, 2009 Report Posted September 12, 2009 What if Balsillie gets the team, but is not allowed to move to Hamilton? Will he try another Canadian city or move to Kansas City? Hmmmm there IS a brand new arena there...
end the curse Posted September 12, 2009 Report Posted September 12, 2009 Well, the arguments are over, the deal tweaking done, and in the end everything remains exactly as it was when this whole mess started. The NHL says that they have decided Balsillie can't have a team and because of that this whole ordeal is a sham. Balsillie says that the NHL cannot override bankruptcy laws of awarding the biggest and best deal because they don't like the opposing bidder, so this is an open and shut case to his advantage. I really have no idea how this will turn out, of course, and no matter how it ends the war will continue in the appellate courts for a long time to come. I think this is the one area that the NHL has a slight edge, and may make the difference as to how this is ruled at the end of the day. Forget the crap about the "right to decide who owns the team" or the "right to decide if a team can be relocated"; that's all in bankruptcy court. The NHL's most persuasive argument is its eternal litigation threat, which I believe will cause the judge to rule in favor of Bettman out of fear that the Balsillie deal will not be able to close in a reasonable time frame for the creditors. The free and clear bad deal is better than the good one that never gets out of the courts. I can't wait to see the ruling, because it will be one for the history books!
deluca67 Posted September 12, 2009 Report Posted September 12, 2009 It might sound crazy, but bankruptcy courts more or less have the power to "rewrite" contracts in this manner. Their top priority is to obtain the greatest possible amount for the bankrupt entity's creditors. For example, bankruptcy courts have the ability to force lenders to a bankrupt borrower to take less than 100 cents on the dollar, and at different times (and in different forms -- e.g. they often have to take equity or different debt instruments) than were contractually agreed to with the borrower. This is why if Balsillie was determined to muscle his way in, bankruptcy court was the best way to do it. The judge's ruling, regardless of opinions being ventured here by those whose expertise seems to be based on watching "L.A. Law," is going to come down to what is best for the creditors. This is why it was another smart move by Balsillie to offer $50MM to Glendale, and why it's important that Glendale still prefers the NHL's bid to Balsillie's. A contract for payment of services rendered is far different from a franchise agreement. If I bought a bankrupt McDonald's franchise and I decide that I can't make money selling only McDonald's authorized products A bankruptcy Judge couldn't order McDonald's to allow me to sell what ever I want under my Golden Arches. If he could where would it end. The judge orders the team has to be allowed to move to Hamilton. Does he then decide which division they play in? Does the judge then get to decide what teams make up that division? It seems that the finances and the future home of the team are two separate issues. If Basillie wishes to buy the franchise rights and take care of the creditors that's one thing. Where that team plays and the future of that franchise should be negotiated between the new owner and the NHL. Anything beyond that just doesn't make sense.
deluca67 Posted September 12, 2009 Report Posted September 12, 2009 Well, the arguments are over, the deal tweaking done, and in the end everything remains exactly as it was when this whole mess started. The NHL says that they have decided Balsillie can't have a team and because of that this whole ordeal is a sham. Balsillie says that the NHL cannot override bankruptcy laws of awarding the biggest and best deal because they don't like the opposing bidder, so this is an open and shut case to his advantage. I really have no idea how this will turn out, of course, and no matter how it ends the war will continue in the appellate courts for a long time to come. I think this is the one area that the NHL has a slight edge, and may make the difference as to how this is ruled at the end of the day. Forget the crap about the "right to decide who owns the team" or the "right to decide if a team can be relocated"; that's all in bankruptcy court. The NHL's most persuasive argument is its eternal litigation threat, which I believe will cause the judge to rule in favor of Bettman out of fear that the Balsillie deal will not be able to close in a reasonable time frame for the creditors. The free and clear bad deal is better than the good one that never gets out of the courts. I can't wait to see the ruling, because it will be one for the history books! As a sports fan my feeling is that any road block put in front of a teams relocation is a good thing. The Coyotes may only have a handful of fans. It would still suck for them as bad as it were the Bills or Sabres moving on.
Eleven Posted September 12, 2009 Report Posted September 12, 2009 Well, the arguments are over, the deal tweaking done, and in the end everything remains exactly as it was when this whole mess started. The NHL says that they have decided Balsillie can't have a team and because of that this whole ordeal is a sham. Balsillie says that the NHL cannot override bankruptcy laws of awarding the biggest and best deal because they don't like the opposing bidder, so this is an open and shut case to his advantage. I really have no idea how this will turn out, of course, and no matter how it ends the war will continue in the appellate courts for a long time to come. I think this is the one area that the NHL has a slight edge, and may make the difference as to how this is ruled at the end of the day. Forget the crap about the "right to decide who owns the team" or the "right to decide if a team can be relocated"; that's all in bankruptcy court. The NHL's most persuasive argument is its eternal litigation threat, which I believe will cause the judge to rule in favor of Bettman out of fear that the Balsillie deal will not be able to close in a reasonable time frame for the creditors. The free and clear bad deal is better than the good one that never gets out of the courts. I can't wait to see the ruling, because it will be one for the history books! No, it's actually the main issue here. The judge noted it when he asked Balsille's counsel if he found it unusual that in the 31-year history of the bankruptcy code, no one has forced a move of a franchise upon a franchisor. It's the only logical reason why Balsille's bid would fail. On the other hand, liquidation is not really an option. There are no real assets that are worth anything outside of the context of an operating NHL team. The equipment is worth next to nothing when compared to debt, the player contracts are useless if the team isn't operating, etc. The value is the ability to compete in the NHL and generate revenue. So, we may find ourselves with a trustee running the entity (not exactly rare, but not the norm, either, in Chapter 11 cases) or perhaps the league running the team until another bid is found. I don't think you'll see protracted litigation through a lot of appeals, no matter who wins. These types of cases don't end up with stayed decisions, because the cost of an appeal bond--provided the appellant could even find someone to give one--would be astronomical. You might see some appeal if Balsille loses and the league or a trustee runs the team, because Balsille won't have to post a bond while the team is being run, but in limbo. But I don't think it will be a lengthy process.
end the curse Posted September 12, 2009 Report Posted September 12, 2009 To you, yes, this is the most important issue. To a bankruptcy judge, however, his obligation is first and foremost to the creditors, and that's why the NHL attorneys reminded the Baum on numerous occasions today that the case would be appealed to the highest levels if they lose, and the creditors who back them said the reason they prefer the lesser bid is because they fear the NHL will hold it up indefinitely in litigation should Balsillie be victorious. It's not about idealism or philosophy, it's about cold, hard cash.
Eleven Posted September 12, 2009 Report Posted September 12, 2009 To you, yes, this is the most important issue. To a bankruptcy judge, however, his obligation is first and foremost to the creditors, and that's why the NHL attorneys reminded the Baum on numerous occasions today that the case would be appealed to the highest levels if they lose, and the creditors who back them said the reason they prefer the lesser bid is because they fear the NHL will hold it up indefinitely in litigation should Balsillie be victorious. It's not about idealism or philosophy, it's about cold, hard cash. To me, none of these issues are very important, actually; they're just interesting because this is what I do. I don't care if a team is in Hamilton, and while I don't think Balsille would be good for the league, I don't really care that much if he gets a team, either. It's not personal. The bankruptcy judge's obligation is first and foremost to uphold the law, not to protect creditors,* and this particular bankruptcy judge today suggested that the law won't allow him to force a move. It is a bankruptcy court, but the Bankruptcy Code is not the only law that applies to these issues. To the NHL, heck, to any franchisor, it is the most important issue in the case. They want to protect who can use their marks and methods and how those marks and methods may be used. *There are more creditors frustrated than satisfied in most bankruptcy proceedings. Ask a creditor-side bankruptcy attorney if she thinks bankruptcy judges' obligations are slanted towards creditors; you'll get a negative. (Ask a debtor-side attorney the same question, and you'll get the opposite answer.)
shrader Posted September 12, 2009 Report Posted September 12, 2009 To you, yes, this is the most important issue. To a bankruptcy judge, however, his obligation is first and foremost to the creditors, and that's why the NHL attorneys reminded the Baum on numerous occasions today that the case would be appealed to the highest levels if they lose, and the creditors who back them said the reason they prefer the lesser bid is because they fear the NHL will hold it up indefinitely in litigation should Balsillie be victorious. It's not about idealism or philosophy, it's about cold, hard cash. This is why I'm completely convinced that Balsillie shot himself in the foot (or did he shoot himself in the leg while carrying his gun in his sweatpants in a night club?) by conditioning his bid on the team being moved immediately. He took this beyond the scope of where Baum can really go with the case.
DR HOLLIDAY Posted September 12, 2009 Report Posted September 12, 2009 To me, none of these issues are very important, actually; they're just interesting because this is what I do. I don't care if a team is in Hamilton, and while I don't think Balsille would be good for the league, I don't really care that much if he gets a team, either. It's not personal. LOL, how can he be worse then then the almost never ending parade of crooks and clowns the NHL has had as team owners over the years?
Eleven Posted September 12, 2009 Report Posted September 12, 2009 LOL, how can he be worse then then the almost never ending parade of crooks and clowns the NHL has had as team owners over the years? My only problem with him is that he seems like a Jerry Jones / Dan Snyder (or even Paul Snyder) type to me. And even that impression is formed from what I read, so maybe I'm wrong.
end the curse Posted September 12, 2009 Report Posted September 12, 2009 There are times when the franchise is wrong. This is arguably one of those times. In the end, the judge goes with what will be best satisfy the creditors within the scope of the law while freeing the debtor of obligation and restructuring the organization to profitability. Anyway, we are arguing semantics. There are attorneys on both sides of this case who can spin this in every which way but loose, and the judge must sift through it and decide what will resolve this best for the people that are owed money.
DR HOLLIDAY Posted September 12, 2009 Report Posted September 12, 2009 My only problem with him is that he seems like a Jerry Jones / Dan Snyder (or even Paul Snyder) type to me. And even that impression is formed from what I read, so maybe I'm wrong. Those guys are annoying owners granted, but they are pretty solid for their leagues.
apuszczalowski Posted September 12, 2009 Report Posted September 12, 2009 Those guys are annoying owners granted, but they are pretty solid for their leagues. Are they? Sure, becuase they are in big markets and make money they are good for the league, but ask any fan outside of Washington and Dallas, or a small marekt owner if they like the 2 of them and how they drive up the cost to do buisness in the league because of their free spending
nfreeman Posted September 12, 2009 Report Posted September 12, 2009 The bankruptcy judge's obligation is first and foremost to uphold the law, not to protect creditors,* and this particular bankruptcy judge today suggested that the law won't allow him to force a move. It is a bankruptcy court, but the Bankruptcy Code is not the only law that applies to these issues. To the NHL, heck, to any franchisor, it is the most important issue in the case. They want to protect who can use their marks and methods and how those marks and methods may be used. *There are more creditors frustrated than satisfied in most bankruptcy proceedings. Ask a creditor-side bankruptcy attorney if she thinks bankruptcy judges' obligations are slanted towards creditors; you'll get a negative. (Ask a debtor-side attorney the same question, and you'll get the opposite answer.) I agree with all this, although I guess I think it goes without saying that the judge has to uphold the law while he protects the creditors' interests. I would just add that the suggestion that the judge might rule a certain way because one side or the other might tie up the case in appeals if they don't win is nonsense. LOL, how can he be worse then then the almost never ending parade of crooks and clowns the NHL has had as team owners over the years? While this is true, it's really neither here nor there -- just because they've let bad guys in before doesn't mean they should continue to do so.
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