NHL Claims vs. ex-Coyotes owner tossed [by Bankruptcy Court, J Baum)

[Ciao]

The NHL's claims are excessive.

Moyes has already lost everything he invested, and is entitled to the same legal protection as any other commercial debtor. He's been held accountable already.

Courts generally don't like claimants making exaggerated claims, and I'm not at all surprised these ones were dismissed.

Bringing Balsillie into this thread is a little over-the-top as well, in my view.

 

[Fugu]

For what? Making a bid on a bankrupt asset? I could have walked into court and made a bid, if I wanted to. Sure he negotiated a deal with Moyes to buy the team once it was in bankruptcy but he didn't put the team in distress to begin with. If they weren't in distress they wouldn't have been allowed to file.

Moyes wouldn't have decided to do what he did if it wasn't a distressed asset. Also keeping in mind that he never really wanted to own the team but ended up bankrolling Ellman which over time just gave him a 100% stake in the team.

 

[TheLegend]

Moyes wouldn't have decided to do what he did if it wasn't a distressed asset. Also keeping in mind that he never really wanted to own the team but ended up bankrolling Ellman which over time just gave him a 100% stake in the team.

Correct.... Moyes got involved with Ellman because of Westgate, not just because the hockey team. To him it was a real estate investment. He put a total of $260 million into the project, and had majority control of the team when he and Ellman split up.

In the end... Ellman gave up his portion of the team, and paid Moyes an estimated $100 million in exchange for Moyes' interest in Westgate.

 

[Gnashville]

For what? Making a bid on a bankrupt asset? I could have walked into court and made a bid, if I wanted to. Sure he negotiated a deal with Moyes to buy the team once it was in bankruptcy but he didn't put the team in distress to begin with. If they weren't in distress they wouldn't have been allowed to file.

Moyes would have not went the bankruptcy route if not for St Jim's scheme. That's where the legal fees were incurred defending the league's rules and rights.

 

[cbcwpg]

Really? He did nothing to earn it.

Gretzky had a legal contract that paid him $8M per year for services rendered. You can argue all you want as to the stupidity of him getting that amount of money or if, as you say, did he deserve it ... but the fact is he is owed that money.

It would be hilarious to see Gretzky sue the NHL to get his money. Another positive effort on the behalf of Bettman.

 

[mouser]

Gretzky had a legal contract that paid him $8M per year for services rendered. You can argue all you want as to the stupidity of him getting that amount of money or if, as you say, did he deserve it ... but the fact is he is owed that money.

It would be hilarious to see Gretzky sue the NHL to get his money. Another positive effort on the behalf of Bettman.

He's at least owned the back pay before he resigned. If he did voluntarily resign as appears to be the case then it's unlikely he's owed anything for the unfulfilled portion of the contract.

Since Gretzky was listed as a creditor in the bankruptcy it's doubtful the NHL owes him anything, though I'm sure one can hire lawyers to craft just about any type of argument.

IMO it truly was dirty what Moyes did with Gretzky's contract and I'm still surprised the court didn't hold Moyes responsible for TGO's backpay. For those that didn't follow the saga: what happened is TGO's employment contract was a personal services contract directly with Moyes, not with the team. Shortly before filing bankruptcy Moyes signed a contract "transferring" the obligation from himself personally to the team ownership organization without TGO's knowledge. Moyes signed this new contract twice, once in his capacity as Jerry Moyes the person and once in his capacity as president of the ownership organization.

TGO's contract contained no allowances for transfership of either side's obligations. Imagine you had a contract with someone to do work for them. Come payday they tell you that it's some other party that's responsible for paying you, even though the contract you signed has no allowance for that. Oh and by the way that other party doesn't have any money, so you're SOL, even though Jerry Moyes could afford to pay TGO.

 

[Mightygoose]

NHL Appears still firm on persuing claims.

http://www.tsn.ca/nhl/story/?id=433740

"We are still evaluating our immediate options, but we have every intention of continuing to pursue our claims against Mr. Moyes for blatant breaches of his contractual obligations to the League," NHL deputy commissioner Bill Daly told TSN Hockey Insider Pierre LeBrun on Wednesday.

 

[Fugu]

TGO's contract contained no allowances for transfership of either side's obligations. Imagine you had a contract with someone to do work for them. Come payday they tell you that it's some other party that's responsible for paying you, even though the contract you signed has no allowance for that. Oh and by the way that other party doesn't have any money, so you're SOL, even though Jerry Moyes could afford to pay TGO.

In that case, TGO's case would be against Moyes personally for a breach of the contract between them. It shouldn't even be a part of the bankruptcy proceedings since the contract (technically, if you're correct) isn't with the entity that went bankrupt.

Furthermore, it's not even the NHL's case in that sense.

 

[mouser]

In that case, TGO's case would be against Moyes personally for a breach of the contract between them. It shouldn't even be a part of the bankruptcy proceedings since the contract (technically, if you're correct) isn't with the entity that went bankrupt.

Furthermore, it's not even the NHL's case in that sense.

Agreed. That's why I was wondering back when the suit was filed whether TGO would join on as a plaintiff.

For all we known Baum may have tossed out that portion of the suit on the basis of the NHL not having standing, as opposed to him finding that Moyes doesn't owe Gretzky his backpay.

 

[OttawaRoughRiderFan*]

Really? He did nothing to earn it.

Even better.

 

[Killion]

In that case, TGO's case would be against Moyes personally for a breach of the contract between them. It shouldn't even be a part of the bankruptcy proceedings since the contract (technically, if you're correct) isn't with the entity that went bankrupt.

Furthermore, it's not even the NHL's case in that sense.

Ya, pretty much what I figured way back when as Moyes illegally transferred the Personal Services Contract to the Coyotes without Gretzkys knowledge much less approval. Essentially Civil Fraud. Gretzky's Attorney's shouldve been all over Moyes when it was discovered in his BK filing yet no.... very peculiar. Im not sure why it wasnt pursued in a separate action.

 

[TheLegend]

Ya, pretty much what I figured way back when as Moyes illegally transferred the Personal Services Contract to the Coyotes without Gretzkys knowledge much less approval. Essentially Civil Fraud. Gretzky's Attorney's shouldve been all over Moyes when it was discovered in his BK filing yet no.... very peculiar. Im not sure why it wasnt pursued in a separate action.

Only reason why I can think of is Gretzky didn't want to be in the spotlight over the franchise's collapse. The $8 million contract he had with Moyes was originally for operating the team, for which he filled the organization with old friends/teammates in coaching positions and his own agent in as the GM. In addition to acting as the "face of the franchise". Which amounted to a single charity golf event in Scottsdale once each year.

It ended up into becoming the head coach, and those results have been painfully noted all too many times.

 

[htpwn]

Moyes would have not went the bankruptcy route if not for St Jim's scheme. That's where the legal fees were incurred defending the league's rules and rights.

No, but the NHL very well might have.

If the NHL actually did what they should have been doing, which is looking after the interests of their owners, Moyes would have no reason to go along with such a risky scheme. The fact that he did is an indication that he felt he was backed into a corner, that there was more to gain by risking every asset of the company than to continue working with the NHL.

Balsillie didn't create that situation, Bettman and Beasley did.

 

[MaskedSonja]

Man, I thought this was over with Moyes-the NHL (understandably) is not letting it go-that's a lotta dough involved with that.

So this comes full circle then-the whole saga started with Moyes going into bankruptcy and all that entailed, and now it's back again with the BK being thrown out and NHL going after punitive action.

It's like 5 years all over again

 

[Killion]

Only reason why I can think of is Gretzky didn't want to be in the spotlight over the franchise's collapse.

That certainly makes sense TL. A separate Civil Suit wouldve likely been ugly, acrimonious to say the least. A lot of Dirty Laundry aired, fingers pointed right at Wayne Gretzky, excoriated by Moyes Attorneys' in defending his actions. TGO's rep taking a major hit.

 

[aqib]

Moyes wouldn't have decided to do what he did if it wasn't a distressed asset. Also keeping in mind that he never really wanted to own the team but ended up bankrolling Ellman which over time just gave him a 100% stake in the team.

Ok let me rephrase. An entity has to be insolvent or illiquid in order to be allowed to file bankruptcy otherwise the case gets dismissed.

 

[aqib]

Gretzky had a legal contract that paid him $8M per year for services rendered. You can argue all you want as to the stupidity of him getting that amount of money or if, as you say, did he deserve it ... but the fact is he is owed that money.

It would be hilarious to see Gretzky sue the NHL to get his money. Another positive effort on the behalf of Bettman.

Not anymore he is not. Think of all the steel companies and airlines that filed bankruptcy. They owed hundreds of millions of dollars to retirees but those debts were cancelled in bankruptcy.

He could sue the NHL for not allowing the sale to Balsillie which would have resulted in him getting paid, but thats about it.

 

[Fugu]

Ok let me rephrase. An entity has to be insolvent or illiquid in order to be allowed to file bankruptcy otherwise the case gets dismissed.

You didn't need to rephrase, as I was agreeing with your point, just adding on to it.

 

[LadyStanley]

http://www.theglobeandmail.com/spor...le-effect/article14791540/#dashboard/follows/

Shoalts with a couple of points

The ruling on the Gretzky debt was interesting because Baum invoked the principle of judicial estoppel. This means someone cannot gain an advantage in court by taking one position and then changing it later to gain another advantage.

In the purchase agreement approved by the court, the NHL said it would pay all unsecured creditors except Moyes and Gretzky. The league claimed Gretzky was not a legitimate creditor, which led to an estrangement between the league and its greatest former player.

Baum ruled this precluded the league from then trying to claim Moyes should cover the $6.5-million, so it will be interesting to see if the NHL – which had promised to pay Gretzky once it sold the club – is willing to settle up.

 

[Fugu]

Also from Shoalts:

This was a nasty blow to Bettman, as he has long told the NHL’s 30 owners they would not lose money on the Coyotes debacle, in which the league was forced to buy the club for $128-million and then have to cough up well north of another $100-million for lawyers and covering losses from keeping the Coyotes in suburban Glendale. A big part of the recovery plan was the lawsuit against Moyes.

I think many of us assumed the NHL planned to recoup that money with a relocation sale, or at least why they wouldn't sell the team for anything below $170MM initially, always trying to stick it to COG otherwise.

But the worst long-term problem the commissioner faces comes from the ruling on Moyes. The judge said the consent agreement all NHL owners must sign, in which they promise to finance all costs of a franchise, does not apply in a bankruptcy proceeding.
This is a severe blow to Bettman, who has long used the consent agreement to force owners eager to escape the financial obligations of a money-losing franchise to keep paying the bills. Often, their only out is to hand over a large chunk of cash, such as the $25-million Ray Chambers paid to get rid of his share of the New Jersey Devils, and then walk away with nothing because the new owner only assumes the franchise’s debts.

A window into what's in the Consent Agreement-- the promise to keep paying the tab indefinitely, even if bankruptcy is involved? (Noting that the actual law would override the contractual requirements of such.)

 

[Tackla]

What are the consequences of this? Gary Bettman getting fired? Expansion imminent?

 

[TheLegend]

No, but the NHL very well might have.

If the NHL actually did what they should have been doing, which is looking after the interests of their owners, Moyes would have no reason to go along with such a risky scheme. The fact that he did is an indication that he felt he was backed into a corner, that there was more to gain by risking every asset of the company than to continue working with the NHL.

Balsillie didn't create that situation, Bettman and Beasley did
.

How do you figure Beasley in regards to the hockey team??? Despite what we know now about the early retirement ponzi scheme he and his staff created.

Beasley offered to help Moyes with the infamous CFD, if Moyes could show he needed it and Moyes walked away. This was before anyone discovered that Moyes had already leveraged the franchise to an $80 million dollar loan to prop up other enterprises.

I would agree that the NHL made a huge mistake allowing a developer (with no intention to own the team long term) buy the franchise in the first place.

BTW... don't think for a moment that Jerry Moyes wasn't being an opportunist himself. There's hardly been a year gone by the past 20 here where he hasn't been sued over some sort of financial dealing.

 

[mouser]

The ruling on the Gretzky debt was interesting because Baum invoked the principle of judicial estoppel. This means someone cannot gain an advantage in court by taking one position and then changing it later to gain another advantage.

In the purchase agreement approved by the court, the NHL said it would pay all unsecured creditors except Moyes and Gretzky. The league claimed Gretzky was not a legitimate creditor, which led to an estrangement between the league and its greatest former player.

Baum ruled this precluded the league from then trying to claim Moyes should cover the $6.5-million, so it will be interesting to see if the NHL – which had promised to pay Gretzky once it sold the club – is willing to settle up.

Maybe my memory is failing me, but I don't recall the NHL promising they would pay TGO?

I thought that was the whole point that the league took the position that Gretzky wasn't a legitimate creditor was because the person that owed him his money--Jerry Moyes--did not file for bankruptcy himself, and thus didn't have his personal obligations discharged by the bankruptcy court. As a casual outsider it seems to me the NHL's position was consistent during the bankruptcy and subsequent Moyes lawsuit, so not getting what would lead to a finding of estoppel.

edit: I suppose that could get back into the issue of standing to make the claim. i.e. as the NHL doesn't owe TGO the money they don't have standing to be recompensated by Moyes for paying it to him. TGO would have to go for it himself from Moyes.

 

[Killion]

Maybe my memory is failing me, but I don't recall the NHL promising they would pay TGO?...

Quite correct mouser. Essentially dropped the games greatest star into the Rabbit Hole. Alice in Wonderland. Strikes me as small change to have corrected that fault.... they wound up Alienating Gretzky.... having done the same to every single major star since Howie Morenz.... so you tell me? Is that right?

 

[TheLegend]

Maybe my memory is failing me, but I don't recall the NHL promising they would pay TGO?

I thought that was the whole point that the league took the position that Gretzky wasn't a legitimate creditor was because the person that owed him his money--Jerry Moyes--did not file for bankruptcy himself, and thus didn't have his personal obligations discharged by the bankruptcy court. As a casual outsider it seems to me the NHL's position was consistent during the bankruptcy and subsequent Moyes lawsuit, so not getting what would lead to a finding of estoppel.

edit: I suppose that could get back into the issue of standing to make the claim. i.e. as the NHL doesn't owe TGO the money they don't have standing to be recompensated by Moyes for paying it to him. TGO would have to go for it himself from Moyes.

Only thing I vaguely remember is Bettman making a statement that the league wanted help Gretzky return to the league in some fashion. My impression was they were sympathetic to his position and would help if they could, but they weren't going to cover the contract he had with Moyes.

Quite correct mouser. Essentially dropped the games greatest star into the Rabbit Hole. Alice in Wonderland. Strikes me as small change to have corrected that fault.... they wound up Alienating Gretzky.... having done the same to every single major star since Howie Morenz.... so you tell me? Is that right?

Not sure you could blame the league here, K. Gretzky had an agreement with Moyes, not the NHL. The league had it's own issue in trying to keep control over where its franchises played. That pretty much trumped everything else to them at that point.