Anti-competition disguised as character issues: Plenty of opposition to come

For the bullet summary, please go here. To contact your MP regarding the Veto issue, please go here.

There is mounting pressure to be applied to the apple cart of the NHL

A 'weathered' Gary Bettman may have coming reason to get 'grumpy' soon too

A 'weathered' Gary Bettman may have coming reason to get 'grumpy' soon too

Careful! Too much pressure on the cart, and the apples will spill onto the ground!

There are mounting forces that are quietly surfacing, one by one.

First, the NHLPA cleans house.

Then, the Canadian Competition Bureau (CCB) shows they have not been sleeping and are ready to pounce when the moment is right.

All that is required now is for the judge in the Phoenix Coyotes case to open the Canadian papers and read he has more support behind his potential league shattering decision than he may already know.

What may be disturbing Judge Baum in exercising the ‘right decision’ is the worry that it would become a mockery – that it would not be enforceable to the detriment of the creditors that ‘can be salvaged’.

Is judge Baum fully aware of the power play, and legal tactics that the NHL is ready to effect in a seemingly uncaring manner? You bet he is.

Does he think hockey in Phoenix and in particular Glendale is “dead in the water”. Absolutely.

Judge Baum has repeatedly advised the City of Glendale to start to think rationally and take that generous $50 million offered by Jim Balsillie and PSE. The judge is probably surprised that PSE did not take it off the table when Glendale snubbed their collective noses at the offer.

Now, what the judge needs to know is that he has the support of the taxpayers of Glendale, and now the CCB (Canadian Competition Bureau).

As reported in the Toronto Star:

The Canadian Competition Bureau is keeping an eagle eye on Jim Balsillie’s fight to buy the Phoenix Coyotes, and is ready to swoop in if the Maple Leafs veto the franchise’s move to Hamilton.

“We are seized by the matter, and we are monitoring it very closely,” Richard Taylor, the deputy commissioner of competition, civil matters, told the Star yesterday.

Without a favorable decision for PSE, the allegations of PSE against the monopoly of MLSE (Maple Leafs Sports and Entertainment) may be a harder sell.

The case that the NHL has put together has been exactly what the PSE legal team have suggested – using Balsillie’s ‘character’ as a reason to avoid potential trouble from the sleeping giants in Toronto.

How to get around that Leafs organization?

Baum had suggested a long time ago that should Balsillie not be looked at favorably as an owner, it would raise a legal eyebrow. Perhaps he should realize now, more than ever, how true that statement was.

If only someone, somehow could make the judge aware that there are Canadian authorities ready to stand behind him, and the ‘right decision’.

Perhaps the NHLPA and it’s mandate to ensure greater league profitablility should put on a press conference of their own. It’s time for the league to work towards profitability not welfare payments to poorer teams. Ship up or ship out.

‘King Bettman’ may be in for more surprises in the near future from all sides.

Again, let’s hope a judge in Phoenix hears the call.’


2 responses to “Anti-competition disguised as character issues: Plenty of opposition to come

  1. I recently heard on the radio that PSE has given Glendale until Wednesday to decide on the $50M offered as a ‘cure’ to the arena lease, good. By then they may all start to realize that Jim doesn’t play softball & they all stand to lose a fortune should Baum give Moyes equal weight as an unsecured creditor.

    That is the big mistake the unsecured creditors have made. Commissioner Gary Bettman has persuaded them that Judge Redfield T. Baum will take his word that Jerry Moyes deserves less. The funny thing is, the NHL forgot to bring any evidence to prove their point, only their opinion.

    In a run of the mill bankruptcy case all of the money owed is not usually there to give out. In this case JB is making Moyes claim (& all the unsecured creditors) whole or virtually so. He is putting in the money Moyes LOANED to the team. The unsecured debtors, in supporting the NHL bid, are setting themselves up to be plucked like a banjo (played) by Bettman when they doesn’t have to. Go ahead & take 40 cents on the dollar, but why turn down 99 cents?

    The PSE bid offers to cover any interest lost if its victory is held up in litigation, another guarantee. Don’t be fooled by promises of more contracts with the team, it will move or it will fold soon. The next time you are left holding the bag you may find it empty, adios.

    Redfield T.Baum can decide that Moyes is a valid creditor & has given every indication that is his concern. He sees that perhaps, for one of the few times in his career, he has the funds at his disposal to wipe out virtually every debt. The appeal of that should not be brushed off lightly.

    There are only 2 choices for him to make, the primary one is if Moyes loan was indeed a loan. If he decides it is not a loan then the NHL is most likely the victor. He has to assume it is a valid loan since no one has proved otherwise. Merely, “cherry picking” & opining means nothing to one such as Baum. As a master of his trade, he will be dispassionate & calculating in how he can financially satisfy all creditors. He understands that this is his job & Jim Balsillie is giving him the necessary tools.

    Once he decides that Moyes is deserving, the puny NHL bid means all of the unsecured creditors would be required to take pennies on the dollar. Fortunately he has another option that takes care of all debtors, the PSE bid. While the NHL constitution is the major obstacle, it is not an insurmountable one by any means.

    As he noted, it appears that the NHL ‘does not always follow its own constitution’; to a large part Gary ‘interprets’ it (a comment of his that would be referred back to under any appeal & he knows it). As such, it is no longer “written in stone”. He therefore has the ability to interpret it as he sees fit too. In fact, Judge Baum may even have more rights under bankruptcy law to interpret the NHL constitution than Gary Bettman. He is the one entrusted to interpret law; Gary is only qualified to give his opinion.

    The instances cited of franchises moving (outside the specified parameters of the constitution), being sold to people of questionable character (Boots, Spano, McNall et al), Gary’s violation of article 6.2, “shall have no financial interest, direct or indirect, in any professional sport.” (40% of his last years income was from NHL merchandise) & other infractions such as the remaining illegal veto clause cry out for Baum’s determination that the Constitution of the NHL is fatally flawed & requires HIS interpretation.

    His statements that he will have “one decision” and that he requires “more time”, bode well. Any decision in favour of PSE requires those very two qualities. A negative decision on Jims bid would not need to be one decision (it could be but doesn’t need to be). & would require little time.

    If the result is to be favourable to Jim & Jerry he would be required to construct a decision and hone it down to its finest points so that in his own mind it would meet all future challenges. He would build a brick wall around his choices & reasoning. He too realizes that this would be difficult but certainly worth the $100+ million dollars that it would reap.

    The NHL has given him all of the material he needs to seal the deal. The “bad faith’ of insider bid repercussions, the delays in filing requested information & the uncorrected allegations by Leopold before the ‘character’ vote can cement his conclusions. If Jim accepts a positive ruling without reservation, the team will see Hamilton next season or sooner.

    Don’t forget, Jims bid has much fewer conditions than the NHL bid. A good portion of the NHL bid is merely rolling over of debt & contains no agreement on a Glendale lease, a necessity. Judge Baum will not assign the lease back to Moyes (an NHL condition) because it is at the crux of his losses & must be ‘cured’. The only other ‘cure’ is the 3-year payment cap & is only available to Jim Balsillie.

    I am generally of the opinion that the longer it takes for a ruling the more likely it is to be positive. It means that he is trying hard to squeeze as much cash out of this deal as necessary. Your Honor, take all the time you need.

    Patrick Romanoski

  2. Pingback: Are we onto ‘Something’? Time for the ‘Real Truth’! « Make It Eight, eh? Hockey again for Winnipeg!

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