There has been a lot of ramped up speculation within the last couple of days regarding a possible bond sale in Glendale, Arizona that would hypothetically close the transaction and allow businessman Matthew Hulsizer to purchase the Phoenix Coyotes and keep them in Glendale. There have been reports by some reporters from TSN and elsewhere that there was optimism that the bonds could sell. It’s been a roller coaster to the finish line of this long drawn out saga. Is the saga finally nearing an end? There’s been a few conflicting reports.
Today on his weekly radio show NHL Hour on XM, Commissioner Gary Bettman told a caller from Phoenix, “[Goldwater] has made the bonds extremely difficult, if not impossible to sell. Time will tell.” He also followed by saying that he hopes the bonds would sell so he could “see what this is all about,” referring to the impending Goldwater lawsuit. That triggered a question in my mind. Would the NHL be willing to fight a case in court that could very likely take them past the point of no return when it comes to scheduling for the 2011-12 season? Goldwater Institute President Darcy Olsen confirmed this past week that the Institute will file suit if the bonds sell. At his highly publicized press conference in Glendale a couple weeks ago, Bettman emphasized that time was short and the end was near. Let’s say the bonds ARE able to be sold (and one would think even with the reports of optimism, that’s a huge stretch at this point). Even if the bonds are sold Goldwater’s lawsuit seems to be getting underestimated by a lot of sources and media lately.
When posing the question to NHL Deputy Commissioner Bill Daly on whether or not the league would consider engaging in a legal fight with Goldwater beyond the point of no return, Daly said via e-mail it would depend on the circumstances. “It depends entirely on the type of legal challenge mounted and the relief sought,” Daly said. “I would say that it is our current anticipation that if the bonds sell, the transaction will close.”
Whether or not the bonds will sell at this point is anyone’s call. Gary Bettman did not sound overly optimistic about the issue on his radio show earlier despite reports by some in the mainstream media that the prospect of the bonds being sold is good as of late.
Despite Daly’s comments, I find it hard to believe the league would want to get involved in a legal battle that could drag on past the point where the NHL schedule makers will need to finalize the schedule for the 2011-12 season. I’m not a lawyer by any means, but there are rumors that Goldwater’s legal strategy may include an attempt to obtain an injunction to prevent the funds from being transferred to Hulsizer to complete the sale. The City of Glendale has agreed to cover $25 million in team losses for the 2010-11 season. There have been reports that losses this year could be upwards of $40 million. The league would apparently be on the hook for the difference.
Now, let’s get this straight. Nobody knows if an injunction will be a factor in this hypothetical case, because it hasn’t happened yet. Nobody knows what Goldwater’s legal strategy will be yet and Goldwater isn’t going to disclose it publicly at this time. However, if the NHL decides to fight this in court, depending on Goldwater’s strategy and the circumstances (i.e. if injunction was a factor), the deal to Hulsizer could be killed and the team could still be the problem of the NHL. That is why I just cannot fathom the league would let a lengthy court battle drag on. However, the NHL has gone to court for their clubs before, and in this drama in the desert, nothing would shock me. As Gary Bettman said, anything can happen. Time will tell.
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