that Star article is mostly talking about the on going saga of Hamilton trying to get a team and threw in the "...got screwed" line.
this
article is Cherry talking about how he was to be the coach of the 92 team in Hamilton (now we know why he hates Ottawa) he is quoted in that article saying:
“We had it all set,” Cherry said. “Gerry Patterson had it all set up. At 12 o’clock when we went to bed we had the franchise. … I was going to be the coach. I was all ready to go.”
When they woke up, they didn’t.
Cherry continued: “[Eventual Tampa Bay Lightning co-founder] Phil Esposito comes on and says, ‘I’ve got the arena and I’ve got the dough.’ He didn’t have the arena and didn’t have a pot to … you know … he didn’t have anything. [Eventual Ottawa Senators founder] Bruce Firestone [also said] ‘I’ve got the arena and I’ve got the dough,’ [but he] didn’t have the arena; didn’t have the dough.”
Correct they never backed out. not indicated in cherry's comments were that Tamp and Ottawa said here's a check and Timmies wanted some installments.
So the "screwing" is that the other two teams didn't have anything but a check that they hoped wouldn't bounce.