Monthly Archives: July 2009

 For the bullet summary, please go here.

It would appear Daryl Jones’  is not without connections. His ex- boss at Onex Investment Corporation became a partner  of  Michael Dell in MSD Capital . This links  relationship between Research Edge LLC executives to other ‘stay home’ bid, creating opportunity and potential unfair advantage. Would we have been led to believe the new group was autonomous?

Daryl Jones visited the White House

 Collusion, in part,  includes:

misrepresenting the independence of the relationship between the colluding parties.

 Well, what if there is a great likelihood that independent private corporations may have key individuals that might work in an alliance, and know one another, to create an unfair advantage?

In yesterday’s article, I spoke of the ‘wrestling metaphor’ of the Reinsdorf team, holding the Balsillie team in a headlock, and waiting for the ‘partners’, the friends of Glendale to finish them off.

 One might argue, if the Jones contingent (Research LLC) was brought in as a backup plan by the Reinsdorf/NHL/Glendale partners? It would seem there could be key relationships to support this notion.

Yesterday, I outlined a possible attraction between the City of Glendale, and Daryl Jones’ group. It involved assistance with tax issues on unpaid property taxes. There were hints that might suggest a motive for Research Edge to be interested in Glendale as an investment opportunity related to these taxes.

Relationships past and present suggests another strong possibility the bid from Jones and his group could hold favour and provide opportunity that would extend the goals and objectives of the City of Glendale, and it’s friends; namely Michael Reinsdorf, Michael Dell, and the bid by Jerry Reinsdorf. It could also represent a way out for the NHL, to prove they have not colluded with Reinsdorf. But, this may be another attempt to control the relationships in place in Glendale, by bringing in more ‘friends’, in an attempt to fool the court.

When Daryl Jones spoke to the Calgary Herald on July 13th regarding a potential bid, he probably shouldn’t have told them as much as he did. But, then again, that’s pretty usual when you figure it won’t be an issue to come back to bite you later. Similar to Anthony LeBlanc’s strange yet revealing comment, claiming ‘Canadians are snapping up foreclosures by the hundreds’ in Arizona. Yes, opportunity for land profits and tax deals abound in Arizona, and in Glendale it would seem!

Daryl Jones explained his groups’ interest in Glendale was not about hockey, in this July 13th comment to the Calgary Herald:

Jones wouldn’t disclose the other parties involved in his group but made it clear they are looking at making an offer from a business perspective — not for the sake of owning a hockey team.

O.K., so it’s a business perspective, not about some nice Canadians wanting to help the Coyotes stay in Phoenix for the fans’ sake, but a business reason. So, would the reason be related to land and taxes perchance? Well, let’s continue.

Remember Michael Dell? He is the secured creditor we believe had financially choked Jerry Moyes of any chance of succesfully running the Phoenix Coyotes, after the loan from SOF Investments? And, the same Michael Dell who owns MSD Capital Corporation, involved in the CityNorth land development subsidy scandal in the Supreme Court? Well, it would seem Michael Dell has some connections to a mutual friend of Daryl Jones.

Would Dell have motive to bring in some backup to ensure land development and tax subsidies would continue, and help the City of Glendale?

According the the Calgary Herald article, talking about Jones:

For the better part of the last decade, he’s been in finance, spending four years working in New York for Onex Corp., a Toronto-based private equity firm.

So, Daryl  Jones would  no doubt have known a man named Eric Rosen, the vice President of Onex at the time, since he worked there for four years, and has been in the finance field for ten years,  before joining Research Edge LLC. Eric Rosen was the Managing Director and Vice President of Onex Investment Corporation, until joining MSD Capital in 2005.  Now, Eric Rosen is currently the partner with Michael Dell in MSD Capital.

So, here we have it. Daryl Jones, having worked with Onex Corp. Onex’s Eric Rosen, having worked  in capacity of Managing director of Onex Corp, coming to MSD Capital in 2005, and now  partner of MSD Capital.

Is it fair to assume that there is a significant relationship between MSD Capital (Michael Dell and Eric Rosen), and Daryl Jones (Research Edge LLC) to suggest this is a continuation of the land and tax strategies of both groups? You bet!  More connections when we would believe the new contingent was autonomous to the other bid.

The ‘stay home bidders’ would seem to be a close knit group, lending further suspicion to an already suspect situation.

From Daryl Jones, we have evidence of discussions with the City of Glendale too, related no doubt to the ‘business opportunities’ described earlier:

Jones’ group still has to submit documents in the next two weeks to the National Hockey League, communicate with the Glendale-area, deal with certain legalities, and negotiate with creditors.

It would seem there is just no stopping the shenanigans to stop the truth from being known to the taxpayers of Glendale, to the bankruptcy trustee of the U.S. Government, and to the courtroom of Judge Baum.

Collusion? It’s certainly looking that way. And with all that money in land development and tax subsidies, these partners are trying to ‘dig in’ for the long haul.

Poor Jerry Moyes. He didn’t stand a chance!

For the bullet summary, please go here.

Is it just me, or is it hard to ‘trust’ anything or anyone anymore in the circus known as the court case that is the Phoenix Coyotes? When the bankruptcy trustee came into play, the concern was the NHL meddling to stop other bidders to Reinsdorf, because as we know, that was the ‘partnership’ of choice.

Now, we have a new Canadian group that want to keep the team in Phoenix (a la, ‘see Jim, this is how you should be as Canadian!’). And to add the icing to that idea, an ex co-worker to Jim at RIM. Hollywood, are you listening? We have some new material you could use in your daytime soaps to keep you busy for a long time. These guys are good! No, there is definitely something fishy with the new rabbit pulled from the hat. Strikingly similar in many ways to the Reinsdorf offer in monetary amount, and renegotiation demands. And, it also makes you wonder if this is like the old wrestling matches where you get the opponent in a headlock, and reach over to tag your buddy to finish him off. May explain the Reinsdorf lawyer saying that they would not get in a bidding war. Why would you? As long as one of us takes it, who cares, right?

We must not forget that to the City of Glendale, the Phoenix Coyotes represented growth and development. Hockey was just a means to an end. Glendale has been striving to solve it’s tax woes, and the thought of losing the Coyotes would dish a blow to the long term vision of building sales tax revenue, residential tax revenue, commercial tax revenue, and resident attraction, all adding to the communities tax base and viability.

But, with housing prices plummeting and foreclosures on the rise, Arizona, including Glendale is likely experiencing a ‘back tax’ nightmare, creating an opposite to growth,  a cash crisis.  The old saying of a penny saved is a penny earned also applies in another way - taxes collected are taxes not lost. And, when  as a City you cannot collect taxes due to homeowners’ losing work and getting behind on their property tax, infrastructure growth worries become a luxury. Collecting what is due becomes a greater priority. 

Since sports development represented the promise of taxes and infrastructure growth in better times for Glendale, perhaps someone could use the hockey team to bring relief from uncollected taxes in the current downturned economy.

Could Research Edge LLC bring the cash flow relief that Glendale needs? Would this be a potential draw to both the City and Research Edge? Looking at the Coyotes as a stand alone opportunity has got to be secondary, even a ‘loss leader’ so to speak. It could be a situation where a company says,‘ Ok, let’s partner in a couple of ways. We take on the Coyotes, and we work an alliance to buy properties for back taxes, or we take tax lien certificates’ (described here and here).

Now, to throw this out there out of the blue without any proof would not be prudent. But there are a couple of pieces of evidence to support the fact that Research Edge may have some thinking in this area.

Anthony LeBlanc, representing the new Canadian contingent, and former employee of RIM, had this to say:

Mr. LeBlanc believes the club can be successful. He cites small changes such as charging for parking, putting a restaurant in the arena and changing marketing tactics as first steps. “We honestly feel that with low-hanging fruit we can get this thing to within a grasp of being a zero-deficit operation within a year to two years maximum,” he said. The city’s economy is showing signs of life, he added, and Canadians are snapping up foreclosed properties by the hundreds.

Now, if the ‘boys’ are thinking parking lot, please don’t tell me my spot will be worth close to $ half a million. Please don’t, I’d sooner not know.

Interesting choice of words. ‘Canadians are snapping up’ real estate in Arizona?

Glendale Foreclosures 'ripe' for profit taking

This site shows just how lucrative this process is as an investment opportunity. It cites an example property, bought for the back taxes of $9,350, and sold for $210,350, a profit of $186,276 (and represents a profit 19 times the initial investment). This gives the City of Glendale the tax payment, and a new owner guaranteeing to pay future taxes. A win for Glendale. This gives the investor the obvious huge profit in buying low and selling incredibly high. Maybe there will be a huge influx of Canadians to Arizona as a result.

The other option is to take the tax lien certificate. In Arizona, this certificate is worth a guaranteed 16% interest rate. The municipality gets it’s taxes paid by the certificate holder, and the holder, as an investment obtains the 16% interest. A win – win yet again.

So, as we can see, in this economy, the way to hedge your ability to ensure profits is to use municipalities, land, and tax strategies to either buy low, and sell high, or provide a guaranteed rate of return, backed by the government to produce a very lucrative return. Try that in the global stock market today!

Now, for these strategies to work, you would have to believe that the market is ripe for an upturn in real estate. Well, according to Keith McCullough of Research Edge, the market is bound to come back, in his prediction, the second quarter of this year (right now). Please see the video as provided on their site. If you listen attentively, you will hear Keith mentioning people should ‘put away the crackberry’. Was that kind of ironic, considering the circumstances, or what?

As we heard from Keith McCullough, the real estate market will hit bottom in the second quarter, and this corresponds to a great opportunity to enjoy significant investment opportunities for investors and real estate buyers. It also represents collected taxes for the City of Glendale.

The theme is the same for Glendale. The approach by Research Edge LLC may be a little ‘out of the box’ as they may say, but it does make one wonder what the real attraction to Glendale is for Research Edge. As we learned before, things aren’t as they appear on the surface. Would this be why they need time to ensure they are able to place a bid on the Coyotes? It may not be as clear cut as just looking at a ‘hockey’ team.

So, while the Reinsdorf bid, and the bid by Research LLC are similar in requesting concessions for Jobing.com arena, and in dollar amount offered, there are potential,  subtle differences as to how they may see land opportunities. Restaurants and parking lot concessions are shared ideas between Reinsdorf and the Canadians. Thinking outside the box may have something yet again to do with land and taxes.

It’s hard to imagine the draw for the simple sake of hockey alone, considering the grave losses of past years. And again, it returns us to the questions of why the terms of the lease and the SOF Investment loan held Jerry Moyes in a financial stranglehold he could not escape. Perhaps he didn’t offer the City a way to enhance it’s tax base.

 Someone should have told Jerry Moyes it was never just about hockey.

(next article……just how much of a stranglehold did the SOF loan represent)

For the bullet summary, please go here.

Is it just me, or is it hard to ‘trust’ anything or anyone anymore in the circus known as the court case that is the Phoenix Coyotes? When the bankruptcy trustee came into play, the concern was the NHL meddling to stop other bidders to Reinsdorf, because as we know, that was the ‘partnership’ of choice.

Now, we have a new Canadian group that want to keep the team in Phoenix (a la, ‘see Jim, this is how you should be as Canadian!’). And to add the icing to that idea, an ex co-worker to Jim at RIM. Hollywood, are you listening? We have some new material you could use in your daytime soaps to keep you busy for a long time. These guys are good! No, there is definitely something fishy with the new rabbit pulled from the hat. Strikingly similar in many ways to the Reinsdorf offer in monetary amount, and renegotiation demands. And, it also makes you wonder if this is like the old wrestling matches where you get the opponent in a headlock, and reach over to tag your buddy to finish him off. May explain the Reinsdorf lawyer saying that they would not get in a bidding war. Why would you? As long as one of us takes it, who cares, right?

We must not forget that to the City of Glendale, the Phoenix Coyotes represented growth and development. Hockey was just a means to an end. Glendale has been striving to solve it’s tax woes, and the thought of losing the Coyotes would dish a blow to the long term vision of building sales tax revenue, residential tax revenue, commercial tax revenue, and resident attraction, all adding to the communities tax base and viability.

But, with housing prices plummeting and foreclosures on the rise, Arizona, including Glendale is likely experiencing a ‘back tax’ nightmare, creating an opposite to growth,  a cash crisis.  The old saying of a penny saved is a penny earned also applies in another way - taxes collected are taxes not lost. And, when  as a City you cannot collect taxes due to homeowners’ losing work and getting behind on their property tax, infrastructure growth worries become a luxury. Collecting what is due becomes a greater priority. 

Since sports development represented the promise of taxes and infrastructure growth in better times for Glendale, perhaps someone could use the hockey team to bring relief from uncollected taxes in the current downturned economy.

Could Research Edge LLC bring the cash flow relief that Glendale needs? Would this be a potential draw to both the City and Research Edge? Looking at the Coyotes as a stand alone opportunity has got to be secondary, even a ‘loss leader’ so to speak. It could be a situation where a company says,‘ Ok, let’s partner in a couple of ways. We take on the Coyotes, and we work an alliance to buy properties for back taxes, or we take tax lien certificates’ (described here and here).

Now, to throw this out there out of the blue without any proof would not be prudent. But there are a couple of pieces of evidence to support the fact that Research Edge may have some thinking in this area.

Anthony LeBlanc, representing the new Canadian contingent, and former employee of RIM, had this to say:

Mr. LeBlanc believes the club can be successful. He cites small changes such as charging for parking, putting a restaurant in the arena and changing marketing tactics as first steps. “We honestly feel that with low-hanging fruit we can get this thing to within a grasp of being a zero-deficit operation within a year to two years maximum,” he said. The city’s economy is showing signs of life, he added, and Canadians are snapping up foreclosed properties by the hundreds.

Now, if the ‘boys’ are thinking parking lot, please don’t tell me my spot will be worth close to $ half a million. Please don’t, I’d sooner not know.

Interesting choice of words. ‘Canadians are snapping up’ real estate in Arizona?

Glendale Foreclosures 'ripe' for profit taking

This site shows just how lucrative this process is as an investment opportunity. It cites an example property, bought for the back taxes of $9,350, and sold for $210,350, a profit of $186,276 (and represents a profit 19 times the initial investment). This gives the City of Glendale the tax payment, and a new owner guaranteeing to pay future taxes. A win for Glendale. This gives the investor the obvious huge profit in buying low and selling incredibly high. Maybe there will be a huge influx of Canadians to Arizona as a result.

The other option is to take the tax lien certificate. In Arizona, this certificate is worth a guaranteed 16% interest rate. The municipality gets it’s taxes paid by the certificate holder, and the holder, as an investment obtains the 16% interest. A win – win yet again.

So, as we can see, in this economy, the way to hedge your ability to ensure profits is to use municipalities, land, and tax strategies to either buy low, and sell high, or provide a guaranteed rate of return, backed by the government to produce a very lucrative return. Try that in the global stock market today!

Now, for these strategies to work, you would have to believe that the market is ripe for an upturn in real estate. Well, according to Keith McCullough (see video below) of Research Edge, the market is bound to come back, in his prediction, the second quarter of this year (right now). Please see the video as provided on their site. If you listen attentively, you will hear Keith mentioning people should ‘put away the crackberry’. Was that kind of ironic, considering the circumstances, or what?

Embedded video from CNNMoney.com Video

As we heard from Keith McCullough, the real estate market will hit bottom in the second quarter, and this corresponds to a great opportunity to enjoy significant investment opportunities for investors and real estate buyers. It also represents collected taxes for the City of Glendale.

The theme is the same for Glendale. The approach by Research Edge LLC may be a little ‘out of the box’ as they may say, but it does make one wonder what the real attraction to Glendale is for Research Edge. As we learned before, things aren’t as they appear on the surface. Would this be why they need time to ensure they are able to place a bid on the Coyotes? It may not be as clear cut as just looking at a ‘hockey’ team.

So, while the Reinsdorf bid, and the bid by Research LLC are similar in requesting concessions for Jobing.com arena, and in dollar amount offered, there are potential,  subtle differences as to how they may see land opportunities. Restaurants and parking lot concessions are shared ideas between Reinsdorf and the Canadians. Thinking outside the box may have something yet again to do with land and taxes.

It’s hard to imagine the draw for the simple sake of hockey alone, considering the grave losses of past years. And again, it returns us to the questions of why the terms of the lease and the SOF Investment loan held Jerry Moyes in a financial stranglehold he could not escape. Perhaps he didn’t offer the City a way to enhance it’s tax base.

 Someone should have told Jerry Moyes it was never just about hockey.

(next article……just how much of a stranglehold did the SOF loan represent)

For the bullet summary, please go here.

Judge Baum, regardless of being an Arizona judge has a lot of thinking to do. He must primarily determine which creditors have rights to being paid, and if the lease is as big a financial object as it appears to be. The Jobing.com lease has become the albatross.

Perhaps in the many years Judge Baum has stood behind the bench, he has heard these types of stories before. With a City colluding with investors and developers to get what they want, sacrificing the current owner as but a fleeting consideration, an inconvenience that got in the way of their goals. Where financers figure they could squeeze the owner for all his worth, and devise a plan to take over. Where a league was helping the said above ‘players’ get their way, exercising control of their own with proxies to add insult to injury, and further stripping the owner of dignity. Shame, shame, shame. 

No, Judge Baum has an opportunity to instill some schooling only a man of his stature could, and to drive a point home to remind us all that ‘old school’ values and ethics are still shared  and important by some. Forget the greed and power quest that corrupts.

And, the taxpayers of Arizona, specifically Phoenix and Glendale have much thinking to do also.

In fact, I would have to say the taxpayers should be very interested to know the true facts about the plans of the Glendale City Hall to mortgage their futures.

The CityNorth case just shows when a City ‘sells out’ to corporate, private developers, how gouged they can truly get.

Right now, the promise of jobs, tax base increase, and sales tax revenue has not likely been what Glendale has expected. We could look at the City’s strategy at this point as ‘going for broke’. If the figure of 72% of taxpayers really aren’t that interested in hockey is true, this should be the indicator that the arena holding hockey, does not hold promise of huge economic stimulus. It would be wiser to put events that 72% of residents would be interested in, and willing to support with tax dollars if need be. But not hockey – the people have made that clear.

How would you like that parking spot you find in the shopping centre to have cost you and your taxpaying neighbours almost half a million dollars? For most of us, it takes many years to earn that much money, but for the wealthy with money, they get a large piece of your income, and your neighbours’ income that makes them richer, and richer. Sorry about your luck, their fortunes are more important than yours.

Forget a few hundred measly dollars, when you are in their ‘game’ the advantage is much greater. And why would you expect them all to flock to the taxpayer trough?

With the economy adjusting, and profit margins shrinking, corporate America is looking to hedge it’s risk, and buy into ventures that promise insanely large return and cannot lose because they are backed by government. That’s why. Glendale is desperate for growth, so desperate, that they have and will continue to look for these ‘corporate partners’ to provide promise of economic growth.

Now when Daryl Jones and Anthony LeBlanc want to keep the team in Glendale, they too are looking to dip their noses into the Glendale taxpayers trough too. New ideas? A new twist? I don’t think so! Welcome to the smile at our face, bury the hatchet and take that taxpayer money boys. You fit right  in this ‘sports opera’.

The only true promise, is them getting paid large! And, ask yourself, ‘is it economical to have a parking spot built for $480,000? Well, that is the price of one at CityNorth, built by Related Companies, part owned by MSD Capital (your neighbour, Michael Dell). Living off the fat of the land in Arizona!

Well, the Jobing.com arena lease is the sticking point, and an opportunity to ‘just say NO to greed’. Who holds the sales tax related bond to the rink? If it happens to be one of the players in the game, and it can be proven the lack of negotation was to further choke off Jerry Moyes financially, and force him out as an owner, then ‘Houston, we have a problem!’

I would go as far as to say that any deals with any investors at this point to keep the team in Glendale has a ‘what are you telling us, and what is the real reason’ tainting to it, don’t you?

Makes you wonder how many rabbits can be pulled from the hat before August 5th. It has become a bit of a charade. That arena lease, and accompanying bond must have a big story to tell I would wager. A story many would seem to not want to become public.

And, so here we are, with the new offer for $150 million, freshly pulled from the hat, what is the real deal?

There is one thing that will always just not sit right with me. Why would the City of Glendale be willing to give new life to the Coyotes’ arena lease to everyone but the man who lost it all, Jerry Moyes? No matter what happens, they will have to live with themselves for that one.

Let’s hope in light of the circus and apparent collusion, Judge Baum looks at the lease with common sense, and uses the legal principles, based on specific formulas for a landlord to recoup losses. To quote a clip from Thompson Hine, in October 2007,

“section 502(b)(6) of the U.S. Bankruptcy Code on claims arising from a debtors lease termination does not limit a landlords claim for tort-related damages. Section 502(b)(6) sets limits on the damages that result from the termination of a lease of real property to the greater of one year, or 15 percent, not to exceed three years of the remaining term of such lease. The provision is designed to provide landlords with compensation for losses due to lease terminations, while preventing excessively large claims from long-term leases that would limit the recovery of other unsecured creditors.”

And, let’s hope Judge Baum holds a special place in his heart for the unsecured creditors, and a fellow ‘old schooler‘.

 For Jerry Moyes, who wanted to help the team survive so badly, he was willing to lose it all. Shouldn’t Jerry Moyes be given the same consideration, and have a chance for a new lease on life too?

For the bullet summary, please go here.

Judge Baum, regardless of being an Arizona judge has a lot of thinking to do. He must primarily determine which creditors have rights to being paid, and if the lease is as big a financial object as it appears to be. The Jobing.com lease has become the albatross.

Perhaps in the many years Judge Baum has stood behind the bench, he has heard these types of stories before. With a City colluding with investors and developers to get what they want, sacrificing the current owner as but a fleeting consideration, an inconvenience that got in the way of their goals. Where financers figure they could squeeze the owner for all his worth, and devise a plan to take over. Where a league was helping the said above ‘players’ get their way, exercising control of their own with proxies to add insult to injury, and further stripping the owner of dignity. Shame, shame, shame. 

No, Judge Baum has an opportunity to instill some schooling only a man of his stature could, and to drive a point home to remind us all that ‘old school’ values and ethics are still shared  and important by some. Forget the greed and power quest that corrupts.

And, the taxpayers of Arizona, specifically Phoenix and Glendale have much thinking to do also.

In fact, I would have to say the taxpayers should be very interested to know the true facts about the plans of the Glendale City Hall to mortgage their futures.

The CityNorth case just shows when a City ‘sells out’ to corporate, private developers, how gouged they can truly get.

Right now, the promise of jobs, tax base increase, and sales tax revenue has not likely been what Glendale has expected. We could look at the City’s strategy at this point as ‘going for broke’. If the figure of 72% of taxpayers really aren’t that interested in hockey is true, this should be the indicator that the arena holding hockey, does not hold promise of huge economic stimulus. It would be wiser to put events that 72% of residents would be interested in, and willing to support with tax dollars if need be. But not hockey – the people have made that clear.

How would you like that parking spot you find in the shopping centre to have cost you and your taxpaying neighbours almost half a million dollars? For most of us, it takes many years to earn that much money, but for the wealthy with money, they get a large piece of your income, and your neighbours’ income that makes them richer, and richer. Sorry about your luck, their fortunes are more important than yours.

Forget a few hundred measly dollars, when you are in their ‘game’ the advantage is much greater. And why would you expect them all to flock to the taxpayer trough?

With the economy adjusting, and profit margins shrinking, corporate America is looking to hedge it’s risk, and buy into ventures that promise insanely large return and cannot lose because they are backed by government. That’s why. Glendale is desperate for growth, so desperate, that they have and will continue to look for these ‘corporate partners’ to provide promise of economic growth.

Now when Daryl Jones and Anthony LeBlanc want to keep the team in Glendale, they too are looking to dip their noses into the Glendale taxpayers trough too. New ideas? A new twist? I don’t think so! Welcome to the smile at our face, bury the hatchet and take that taxpayer money boys. You fit right  in this ‘sports opera’.

The only true promise, is them getting paid large! And, ask yourself, ‘is it economical to have a parking spot built for $480,000? Well, that is the price of one at CityNorth, built by Related Companies, part owned by MSD Capital (your neighbour, Michael Dell). Living off the fat of the land in Arizona!

Well, the Jobing.com arena lease is the sticking point, and an opportunity to ‘just say NO to greed’. Who holds the sales tax related bond to the rink? If it happens to be one of the players in the game, and it can be proven the lack of negotation was to further choke off Jerry Moyes financially, and force him out as an owner, then ‘Houston, we have a problem!’

I would go as far as to say that any deals with any investors at this point to keep the team in Glendale has a ‘what are you telling us, and what is the real reason’ tainting to it, don’t you?

Makes you wonder how many rabbits can be pulled from the hat before August 5th. It has become a bit of a charade. That arena lease, and accompanying bond must have a big story to tell I would wager. A story many would seem to not want to become public.

And, so here we are, with the new offer for $150 million, freshly pulled from the hat, what is the real deal?

There is one thing that will always just not sit right with me. Why would the City of Glendale be willing to give new life to the Coyotes’ arena lease to everyone but the man who lost it all, Jerry Moyes? No matter what happens, they will have to live with themselves for that one.

Let’s hope in light of the circus and apparent collusion, Judge Baum looks at the lease with common sense, and uses the legal principles, based on specific formulas for a landlord to recoup losses. To quote a clip from Thompson Hine, in October 2007,

“section 502(b)(6) of the U.S. Bankruptcy Code on claims arising from a debtors lease termination does not limit a landlords claim for tort-related damages. Section 502(b)(6) sets limits on the damages that result from the termination of a lease of real property to the greater of one year, or 15 percent, not to exceed three years of the remaining term of such lease. The provision is designed to provide landlords with compensation for losses due to lease terminations, while preventing excessively large claims from long-term leases that would limit the recovery of other unsecured creditors.”

And, let’s hope Judge Baum holds a special place in his heart for the unsecured creditors, and a fellow ‘old schooler‘.

 For Jerry Moyes, who wanted to help the team survive so badly, he was willing to lose it all. Shouldn’t Jerry Moyes be given the same consideration, and have a chance for a new lease on life too?

To see the ‘bullet’ summary, please go here.

Commentary for June 24, 2009:

NHL Commissioner Gary Bettman

I want to place this video (see bottom of article) of the June 2, 2009 interview Ron McLean had with NHL Commissioner Gary Bettman again, because it brings to light some very interesting aspects of the league development that could be very key to the Phoenix Coyotes case.

Correct me if I am wrong, but there was pressure ‘way back when’ to build state of the art arenas, with large luxury boxes for corporate partners that would ensure that with the high player salaries in the NHL, the revenues could come in line to ensure financial viability of the team.

Now, it seems a little strange for the situation in Winnipeg, in retrospect.

Winnipeg was a city filled with devote fans but a smaller,  ‘non-state-of-art rink’. But devote fans in a proven hockey mad market. So much so, that the heartwrenching view of

Winnipeg Arena Demolition (after Jets relocation)

 35,000 filling the streets of Winnipeg in support of a hope to save the franchise, still brings a tear to the eye. Just watch the video if you haven’t. I am sure you will agree.

Commissioner Bettman, in his discussion with Ron McLean in the interview on June 2nd, explained that the NHL allows an owner rights to a franchise located in a given place (in this case Phoenix), and does not have rights to relocate the franchise to another location.

As Mr. Bettman put it, he would argue with the court that the owner does not own the franchise, but rather it belongs to the partners as a whole.

Ron McLean spoke of the owners in the league as a consortium. Mr. Bettman argued the owners were partners.

Ron McLean (Hockey Night in Canada)

How this notion ties in to the situation in Phoenix is very interesting. There could be more “partners” than we know. The partners may be more than just the owners, and likely extends to the developers of the arenas, the financiers of the arenas, and in Phoenix, arguably, the City of Glendale, and the larger infrastructure of the entire Westgate area.

Where do we draw the line, where the NHL is not responsible for the larger infrastructure growth of a city? Has the NHL hopped into bed, so to speak, with more partners than it should? And, if so, how does this negatively impact on a partner like Jerry Moyes, who seems to have less rights than other partners, those of whom are not even part of the league?

Interesting to say the least.

We are talking specifically about the Phoenix Coyotes. The other day, I had a visit to this site (makeiteighteh.com) from Vieste LLC, a  ’partnering’ firm to International Facilities Group (IFG). The visited article was on the topic of the potential that Jerry Moyes was victim of a ‘squeeze play’ by the apparent friends of Glendale. Should we call them ‘partners‘ too? Why not? It would seem they have enough pull that shortly thereafter, the NHL head office visited my site and viewed the same article. I think we are getting a picture where the ‘partnerships’ extend.

And, when Jerry Reinsdorf says he isn’t getting in a bidding war, why bother when you might have a few friends willing to accomodate you:

Reinsdorf’s proposal carries several conditions, including a new arena lease and concessions from creditors. “He doesn’t want to pay a whole lot for this team. He’s not going to get into any sort of bidding war,” said a source close to the auction.

Mr. Bettman, who would argue the league controls the location of franchises, required Mr. Moyes to sign proxies relinquishing all rights, including the right to relocate the franchise. So, are we to believe Mr. Moyes did indeed have rights before or despite the proxies? I would argue yes.

And, why don’t we have a look at a segment of the SOF Investment loan to Mr. Moyes (the secured $80 million loan held by Michael Dell), a little more closely, specifically at this significant part:

Further, all revenue is pledged to SOF, except $2.5-million annually in arena-naming rights, $1.50 a ticket owed to the city of Glendale (for paying $180-million toward the $220-million arena) and $9 a ticket for “all NHL hockey events” to the club. Other revenue includes NHL broadcasting rights, any share of future expansion or relocation fees, revenue sharing, merchandise sales, concessions, sponsorship contracts and practice facility rentals.

I’m sorry, did that say ‘relocation fees’?

Mr. Bettman himself has discussed teams potential relocations in the past himself (including Pittsburgh), and we do not need to look up how many hockey teams have relocated or changed ownership in the past; suffice it to say there is both precedent and argument to do so. Was the issue with Pittsburgh due in part by needing a new ‘state of the art’ arena perchance? A pattern here?

So, why now would the rules change? Which partner(s) don’t want this franchise to relocate?

Would it be the City of Glendale, that stands to be left with a hefty sales tax bond nightmare (on the buy now, pay dearly later plan)? Would it be the bondholder, who loses his lucrative deal with said City, and will be mad as all get out if his or her income stream disappears? To that person I say, keep watching the Phoenix CityNorth case, and see if it will fly anyhow. Or, could it be a developer that may have lined up some of these lucrative projects, and investors whose reputation may suffer, and truths that may come to the surface? To all of them, I say too bad. Get over it.

Who cared about another partner, who put a great deal of  his personal wealth in to save the franchise? Remember Mr. Moyes, the one who stands to lose the most ‘honest’ money? Hmmm….?

Jobing.com arena (Bond for $180 million. $720 million lease breaking penalty (4 x value))

When Mr. Bettman talks about the bankers, the question is who are the bankers ?  It brings back the same question of who holds the Jobing.com bond?  The bond that is holding the City of Glendale captive, the NHL captive, and Jerry Moyes in Chapter 11 ? The same bond that holds a four times value penalty to break. Sounds like the investment was based on sales tax related revenues.

 What if these bankers were also involved in other aspects of the Coyotes’ operations, in unrelated areas? Would that present a conflict of interest and give special power and abilities to exercise control? Would they be able to exercise control in other than ‘non-biased’, non-arms length way? I would argue yes, yes, and yes. Is this starting to add up in a disturbing way?

Would this create opportunity to abuse other partners by exercising fiduciary control, and in essence, ‘squeeze out’ another partner? Again, yes.

And, just to add another significant possibility. Why would the City of Glendale refuse to renegotiate the lease with Jerry Moyes? Well, their goal has always been land development. When Ellman and Moyes broke up the partnership, Jerry Moyes did not represent land development anymore. Ah, but there are parties in place with connections to land development, namely Michael Dell and his new relationship as shareholder with Related Companies (CityNorth) . And, further development opportunities will require capital infusion from MSD Capital into it’s partnership arrangement with Related Companies. Could this be the new opportunity for growth that Glendale is looking for? What would the new group have that Jerry Moyes could not offer?

So, we need to ask ourselves a very important question. Which partners are we talking about? I would say it extends beyond the owners and players in the league, and dangerously treads into areas that conflict with the true owner’s rights.

This might explain why a developer/investment firm would be contacting the NHL within 27 minutes of looking at a pretty touchy article. And, might suggest a partnership that is unhealthy to the detriment of the league and its’ owners. How many angles are there? How many partners? What happened to the game of hockey?

I would suggest that the video below be watched with a careful eye, and attentive ear. You may just hear things this time around, that didn’t make sense before.

Ron McLean asked, “If the partners, the owners, came to you and said, ‘what’s your recommendation Gary?’”

Mr. Bettman replied, “I would tell them before I would tell you”.

The question is, which ‘partner’ does Mr. Bettman mean? Could it be the partner that might have contacted him  or someone else in the NHL offices just 27 minutes after reading an article? Wouldn’t it be great to know who ‘them’ are?

To see the ‘bullet’ summary, please go here.

Commentary for June 24, 2009:

NHL Commissioner Gary Bettman

I want to place this video (see bottom of article) of the June 2, 2009 interview Ron McLean had with NHL Commissioner Gary Bettman again, because it brings to light some very interesting aspects of the league development that could be very key to the Phoenix Coyotes case.

Correct me if I am wrong, but there was pressure ‘way back when’ to build state of the art arenas, with large luxury boxes for corporate partners that would ensure that with the high player salaries in the NHL, the revenues could come in line to ensure financial viability of the team.

Now, it seems a little strange for the situation in Winnipeg, in retrospect.

Winnipeg was a city filled with devote fans but a smaller,  ‘non-state-of-art rink’. But devote fans in a proven hockey mad market. So much so, that the heartwrenching view of

Winnipeg Arena Demolition (after Jets relocation)

 35,000 filling the streets of Winnipeg in support of a hope to save the franchise, still brings a tear to the eye. Just watch the video if you haven’t. I am sure you will agree.

Commissioner Bettman, in his discussion with Ron McLean in the interview on June 2nd, explained that the NHL allows an owner rights to a franchise located in a given place (in this case Phoenix), and does not have rights to relocate the franchise to another location.

As Mr. Bettman put it, he would argue with the court that the owner does not own the franchise, but rather it belongs to the partners as a whole.

Ron McLean spoke of the owners in the league as a consortium. Mr. Bettman argued the owners were partners.

Ron McLean (Hockey Night in Canada)

How this notion ties in to the situation in Phoenix is very interesting. There could be more “partners” than we know. The partners may be more than just the owners, and likely extends to the developers of the arenas, the financiers of the arenas, and in Phoenix, arguably, the City of Glendale, and the larger infrastructure of the entire Westgate area.

Where do we draw the line, where the NHL is not responsible for the larger infrastructure growth of a city? Has the NHL hopped into bed, so to speak, with more partners than it should? And, if so, how does this negatively impact on a partner like Jerry Moyes, who seems to have less rights than other partners, those of whom are not even part of the league?

Interesting to say the least.

We are talking specifically about the Phoenix Coyotes. The other day, I had a visit to this site (makeiteighteh.com) from Vieste LLC, a  ’partnering’ firm to International Facilities Group (IFG). The visited article was on the topic of the potential that Jerry Moyes was victim of a ‘squeeze play’ by the apparent friends of Glendale. Should we call them ‘partners‘ too? Why not? It would seem they have enough pull that shortly thereafter, the NHL head office visited my site and viewed the same article. I think we are getting a picture where the ‘partnerships’ extend.

And, when Jerry Reinsdorf says he isn’t getting in a bidding war, why bother when you might have a few friends willing to accomodate you:

Reinsdorf’s proposal carries several conditions, including a new arena lease and concessions from creditors. “He doesn’t want to pay a whole lot for this team. He’s not going to get into any sort of bidding war,” said a source close to the auction.

Mr. Bettman, who would argue the league controls the location of franchises, required Mr. Moyes to sign proxies relinquishing all rights, including the right to relocate the franchise. So, are we to believe Mr. Moyes did indeed have rights before or despite the proxies? I would argue yes.

And, why don’t we have a look at a segment of the SOF Investment loan to Mr. Moyes (the secured $80 million loan held by Michael Dell), a little more closely, specifically at this significant part:

Further, all revenue is pledged to SOF, except $2.5-million annually in arena-naming rights, $1.50 a ticket owed to the city of Glendale (for paying $180-million toward the $220-million arena) and $9 a ticket for “all NHL hockey events” to the club. Other revenue includes NHL broadcasting rights, any share of future expansion or relocation fees, revenue sharing, merchandise sales, concessions, sponsorship contracts and practice facility rentals.

I’m sorry, did that say ‘relocation fees’?

Mr. Bettman himself has discussed teams potential relocations in the past himself (including Pittsburgh), and we do not need to look up how many hockey teams have relocated or changed ownership in the past; suffice it to say there is both precedent and argument to do so. Was the issue with Pittsburgh due in part by needing a new ‘state of the art’ arena perchance? A pattern here?

So, why now would the rules change? Which partner(s) don’t want this franchise to relocate?

Would it be the City of Glendale, that stands to be left with a hefty sales tax bond nightmare (on the buy now, pay dearly later plan)? Would it be the bondholder, who loses his lucrative deal with said City, and will be mad as all get out if his or her income stream disappears? To that person I say, keep watching the Phoenix CityNorth case, and see if it will fly anyhow. Or, could it be a developer that may have lined up some of these lucrative projects, and investors whose reputation may suffer, and truths that may come to the surface? To all of them, I say too bad. Get over it.

Who cared about another partner, who put a great deal of  his personal wealth in to save the franchise? Remember Mr. Moyes, the one who stands to lose the most ‘honest’ money? Hmmm….?

Jobing.com arena (Bond for $180 million. $720 million lease breaking penalty (4 x value))

When Mr. Bettman talks about the bankers, the question is who are the bankers ?  It brings back the same question of who holds the Jobing.com bond?  The bond that is holding the City of Glendale captive, the NHL captive, and Jerry Moyes in Chapter 11 ? The same bond that holds a four times value penalty to break. Sounds like the investment was based on sales tax related revenues.

 What if these bankers were also involved in other aspects of the Coyotes’ operations, in unrelated areas? Would that present a conflict of interest and give special power and abilities to exercise control? Would they be able to exercise control in other than ‘non-biased’, non-arms length way? I would argue yes, yes, and yes. Is this starting to add up in a disturbing way?

Would this create opportunity to abuse other partners by exercising fiduciary control, and in essence, ‘squeeze out’ another partner? Again, yes.

And, just to add another significant possibility. Why would the City of Glendale refuse to renegotiate the lease with Jerry Moyes? Well, their goal has always been land development. When Ellman and Moyes broke up the partnership, Jerry Moyes did not represent land development anymore. Ah, but there are parties in place with connections to land development, namely Michael Dell and his new relationship as shareholder with Related Companies (CityNorth) . And, further development opportunities will require capital infusion from MSD Capital into it’s partnership arrangement with Related Companies. Could this be the new opportunity for growth that Glendale is looking for? What would the new group have that Jerry Moyes could not offer?

So, we need to ask ourselves a very important question. Which partners are we talking about? I would say it extends beyond the owners and players in the league, and dangerously treads into areas that conflict with the true owner’s rights.

This might explain why a developer/investment firm would be contacting the NHL within 27 minutes of looking at a pretty touchy article. And, might suggest a partnership that is unhealthy to the detriment of the league and its’ owners. How many angles are there? How many partners? What happened to the game of hockey?

I would suggest that the video below be watched with a careful eye, and attentive ear. You may just hear things this time around, that didn’t make sense before.

Ron McLean asked, “If the partners, the owners, came to you and said, ‘what’s your recommendation Gary?’”

Mr. Bettman replied, “I would tell them before I would tell you”.

The question is, which ‘partner’ does Mr. Bettman mean? Could it be the partner that might have contacted him  or someone else in the NHL offices just 27 minutes after reading an article? Wouldn’t it be great to know who ‘them’ are?

When this is over, will Jerry Moyes have a case against the NHL and others?

So much has happened regarding this case, I think we need to recap:

• Why might the court suspect favoritism to the Reinsdorf bid, and a U.S. Bankruptcy trustee has entered the fray?
• Land development and the promise of revenues outside of hockey with son, Michael Reinsdorf and others
• Michael Reinsdorf expert in lease negotiations – did he work or help the City of Glendale with the Jobing.com lease (notes)?
• More on possible unfair advantage and favoritism to Reinsdorf family by the City of Glendale (meet Uncle Glendale)
• more argument on the relationship of Glendale with Michael Reinsdorf and where was the assistance to Jerry Moyes?
• How much is the land development costing taxpayers, and don’t they deserve to know!
• Why secured creditor Michael Dell may accept renegotiating the$80 million loan to SOF Investments (land development subsidies – CityNorth)
• Who stands to gain large by holding the Jobing.com arena bonds from the City of Glendale, and why we need to know who holds them?
• Was Jerry Moyes just not in the club, and squeezed out by the friends of Glendale?
• Why was Vieste LLC, the NHL, and the City of Glendale so interested in the article on Moyes being ‘squeezed’?
• Who are the true partners in Arizona to the NHL?
• The Jones’ Group from Canada. Land deals too?
• MSD Capital tied to Research Edge LLC?
• ‘Muckety’ waters indeed! Not just anyone allowed in this club!
• Time to speak to Senator McCain and end the taxpayer abuse!
• The legal ‘eyebrow’ is officially raised as Jim Balsillie is denied by the NHL Board of Governors
• Jerry Reinsdorf a political fundraiser for Republican Senator John McCain
• the proof of collusion is in the deal
• the true state of the NHL being exposed
• Move over Rosen, is there more room at the MSD Inn for Alan Leventhal and the Beacon companies?
• How far will Gary Bettman go with this, and the bigger question, why?
• Did everyone know Glendale would be an eminent failure? Relocation here we come!
• Will the NHL turn out to have plastic integrity, as plastic as the ice in Vegas?
• Battle of the ‘BOG’, be it hockey, land, or REIT’s
• Crybabies in the Glendale Court. When the victim becomes the perpetrator.
• Reading through the lines. The true issue and story.
• Is it time to reheat the ‘done like’ dinner? Plan B bidders out of mothballs?
• Why the intense interest in ‘Done like Dinner gets reheated’?
• How do you compare the treatment of Tom Hicks to Jerry Moyes? Bias against Balsillie?
• Why Jim Balsillie didn’t stand a ‘dog’s chance’ in the BOG vote.
• Glendale should have taken some ‘Smart’ advice, and avoided ‘Kaos’
• Sign Gordie Canuck’s petition against NHL merchandise sales here.

When someone at Vieste LLC viewed the article on Moyes being squeezed, did that person contact the NHL head office? After the NHL viewed the article and other articles on this site, did they contact the City of Glendale, who also viewed the website for the first time?

Where there’s smoke, there’s fire?

Why would they waste their time? After all, the deposition of Commissioner Bettman and Bill Daly was to occur the next day. And Glendale was already involved in a bunch of work due to the court demanding they turn records over to the Goldwater Institute.

So, why would that article get some attention? And why would the NHL be on the site just 27 minutes after Vieste LLC?

Why would a developer and investment firm possibly be talking with the league? Could there have been a nerve hit?

And, why yesterday was Mercantile Capital Corporation (owned by Michael Reinsdorf), checking out the article on why the Glendale taxpayers deserve answers?

Who holds the bond for the Jobing.com arena may make this case very compelling. What if it is one of the players mentioned here? That would explain much! I hope the Goldwater Institute is able to obtain that information, as it may assist in any question of unfair advantage or collusion. It may be the icing for this cake. At least Goldwater will be able to make public all the information that the taxpayers deserve to see.

And, when the aftermath of this is behind us, the lawyers for Jerry Moyes might just be getting restarted.  If it can be shown that the NHL holds non- arms length relationships with land developers and financers, and these parties in essence, “hold the league” captive, then Moyes could have a civil lawsuit against the NHL. The relationship of a league should be of primary concern first to the members of the league – owners and players, and only secondarily to the municipalities and developers building the facilities. To hold an owner, stripped of rights because of poor development strategies is potentially actionable in court. I would wish Jerry Moyes well in that regard. And, for that matter, all other owners in the NHL should be aware of this as well.

Perhaps the coming days will tell us more. I think at this stage everyone deserves the real truth!  And, please, no more PR City Hall rhetoric trying to explain away what lies much deeper. It really is getting rather ‘old’.

In yesterday’s post, I asked the question whether or not Jerry Moyes could have been the victim of a ‘squeeze play’.

Was Mr. Moyes intentionally setup for financial failure in the venture for ownership of the Phoenix Coyotes?

Is there possibility of ‘Collusion‘ amongst more players in this case is the question – beyond the ‘bidders’, and extending far deeper?

Would there be a connection between an investment company, the league, and the City of Glendale?

We can only observe evidence.

Yesterday, after posting the article on the ‘squeeze play’, three significant visits were made in this order, and at these times, to makeiteighteh.com (this site):

• 2:06 PM EST – Vieste LLC (Chicago, IL)
• 2:33 PM EST – NHL Enterprises (New York, NY)
• 5:44 PM EST – City of Glendale (Glendale. AZ)

The NHL had not prior visited the site to our knowledge, and their visit came just 27 minutes after Vieste, LLC’s. Vieste LLC had visited the site on a prior date, before yesterday’s story.

Today, the lawyer for Jerry Moyes will deposition Commissioner Gary Bettman, and Bill Daly for four hours.

If you are inclined, it may be a good time to wish Jerry well, to say a prayer for him, and to hope that justice will prevail.

I believe Jerry Moyes deserves to walk away at the end of the day, with head held high. It takes courage to stand up and face some pretty tough times. Jerry Moyes has plenty of courage.