Phoenix XX: Two Weeks!

[RR]

I wonder if CBRE also backed the Prescott/Hocking study?

CBRE is NOT among the 12 defendants in the Allstate case. As it appears Allstate is going after everyone involved, fair to say CBRE not involved.

 

[Hawker14]

A bit more on the lawsuit against Hocking et al from fellow defendant Global Entertainment's perspective.

The Company, PVEC, LLC and two of the Company’s directors (James Treliving and Richard Kozuback) are four of the sixteen defendants in a series of suits consolidated under 1) Covin, et al. v. Robert W. Baird & Co., Global Entertainment Corporation, et al, United States District Court, District of Arizona, Case No. 3:09-cv-8174-MEA filed September 30, 2009 and 2) Wells Fargo Bank, N.A. v. Robert W. Baird & Co., Global Entertainment Corporation, et al, Maricopa County Superior Court, Case No. CV2009-030148 filed September 30, 2009. The litigations relate to the offering for the Bonds, issued to support the construction of the events center in Prescott Valley, Arizona. The complaints allege the bond offering failed to properly disclose certain facts, that the underwriters and certain law firms acted with deliberate recklessness and that the bond documents are defective. The plaintiffs are bond holders or their representatives and seek unspecified damages and/or reimbursement of bond investments, in excess of $26 million. The Company has indemnified all former and current directors and officers in connection with this matter. The Company believes the claims against Global Entertainment Corporation, PVEC, LLC and the two directors are without merit. The Company’s insurance carrier has been notified. The Company’s insurance carrier has declined coverage of Global Entertainment Corporation in this matter, based on the assumption that the Company did not issue or sell the Bonds. Defense costs are allocated 45% to defense of Global Entertainment Corporation and 55% to defense of the directors. Defense costs allocated to Global Entertainment Corporation are being expensed as incurred and defense costs allocated to the directors are being expensed as incurred up to the amount of a $75 thousand insurance deductible. As of November 30, 2010, the deductible has not yet been met.

 

[Einstein Theory]

Let me ask this question, for anyone with a half decent understanding of Arizona Law:

Assuming GWI intends to stop the issuing of these bonds, would they have to file an injunction today (or perhaps Monday) to prevent it? Or could a legal action after the issuing of the bonds somehow reverse the transfer of funds?

In other words, does GWI have poop or get off the pot with in the next two business days?

 

[RR]

In regards to the numbers that were obtained for the proposed 5000 seat arena and the projections for those, I would guess that TL is the defendant that will address these allegations in court, no?

I think you've just summed up most of the posts during this saga. And I do not mean that as a criticism. Anyone's guess is as good as anyone else's.

 

[davemac1313]

Can't wait to see how this finally plays out....It will end it seems in a matter of days, one way or another.

I would like to see GWI take this to court, just so I can see if my sources are correct. My sources claim that the City of Glendale's ENFORCEABLE OPINION is LOGAN......

 

[Dado]

In other words, does GWI have poop or get off the pot with in the next two business days?

I dont believe so. CoG has the general right to issue bonds, and the wording on the offering isn't IMO specific enough to warrant an injunction. It seems to me the best time to file anything is after the bonds are sold, but before they're moved out of escrow into Bettman's pocket.

I can't keep up - who is "Logan", again?

 

[RR]

Geezuz RR cry me a river would ya? The COG , Beas,Scrug, Hock,Lyn and the likes have been mincing and parsing words from the get go.

Good on the GWI for fighting fire with fire.

That makes no sense, and plays into my earlier my point: if something is said (words are parsed) that supports one's position, it is taken as gospel, and the opposing side is trashed. On the flip side if someone doesn't like what is said (or in this case appears in a legal document), no big deal.

Unless "fighting fire with fire" means GWI is sinking to the diabolical level that COG has been accused of here, you're assertion makes no sense.

 

[Gump Hasek]

CBRE is NOT among the 12 defendants in the Allstate case. As it appears Allstate is going after everyone involved, fair to say CBRE not involved.

That does not mean they did not offer any ancillary opinion regarding the matter, just that they weren't deemed by the complainant as a sue-able party.

They may have offered an opinion but were not deemed to be one of the parties who perhaps may or may not have initially intentionally caused harm.

 

[gollybass]

That does not mean they did not offer any ancillary opinion regarding the matter, just that they weren't deemed by the complainant as a sue-able party.

They may have offered an opinion but were not deemed to be one of the parties who perhaps may or may not have initially intentionally caused harm.

how are you linking them to the allstate case at all?

 

[goyotes]

That rattle you hear is the GWI's sabre. It will never come out of the holster. It is all about PR for them, and the stated principal is secondary to the GWI looking impressive and good. They will issue another statement highly critical of the deal, but really more higly critical of the process. They will continue to "look" at this, and the cloud of litigation will never be removed; it will just disappate like a smoke screen.

There will be no injuction, which they would need to file today to have heard before the $$$ is transfered to MH. They would not seek to enjoin the sale of the bonds, but the transfer of the bond $$$ to MH. The timing would require a filing today to have any hope of the court acting before Tuesday which is when the transfer and deal is supposed to happen.

There will be no suit, becasue the GWI knows they would lose on a constitutional challenge. Their real objective hear is to let public officials know they will be a real pain in the %4#$ if they try to do deals that involve public money. But even the GWI knows they cannot stop every private/public partnership. The City North holding doesn't go that far, and they will never get a better billy pulpit than the current holding. From a litigation strategy standpoint, there is only downside for the GWI's greater mission. The biggest part of being a successful litigator is knowing how to pick your cases.

 

[Kebekoi]

What appends of Westgate if the NHL moves out of Glendale?

 

[Gump Hasek]

how are you linking them to the allstate case at all?

I'm not linking them at all. I initially asked if they offered any opinion regarding the Prescott/Hocking study. Please follow the conversation and don't infer that I've tried to do something that I haven't. I simply asked a question.

I wonder if CBRE also backed the Prescott/Hocking study?

 

[LadyStanley]

Mod note -- couple of reminders as the panic/emotion level rises...

First, if you see a "bad" post, report it, don't respond to it.

Second, keep it civil. Address the post, not the poster.



My suggestion for the next thread title:

If the bond breaks, the deal will fall (and down will come hockey, arena and all)

 

[gollybass]

I'm not linking them at all. I initially asked if they offered any opinion regarding the Prescott/Hocking study. Please follow the conversation and don't infer that I've tried to do something that I haven't. I simply asked a question.

That does not mean they did not offer any ancillary opinion regarding the matter, just that they weren't deemed by the complainant as a sue-able party.

They may have offered an opinion but were not deemed to be one of the parties who perhaps may or may not have initially intentionally caused harm.

you seem to be implying that they were somehow possibly involved in the deal, I just didnt understand how your train of thought was even suggesting that.

 

[cbcwpg]

I can't keep up - who is "Logan", again?

Logan is the little kid that his parents let stand in front of the CoG council and beg for his team. And after the bonds are sold and the CoG is saddled with more debt than they can handle, Logan will be the first kid to move out of Glendale so he isn't paying this mess off for the rest of his life.

Phil Lieberman, a councillor in Glendale for 19 years, initially said he would oppose the motion to keep the Coyotes in Glendale. But a young boy named Logan softened his heart. The boy attended the council meeting draped in an oversized Coyotes jersey, a matching cap slipped over his ears. Lieberman asked Logan to stand.
"Logan came to me and asked if I would vote for this resolution tonight," Lieberman said. "I can't turn him down."
Read more: http://www.cbc.ca/canada/manitoba/story/2010/05/11/sp-coyotes-glendale-vote.html#ixzz1Dfw7Edvh

 

[Gump Hasek]

you seem to be implying that they were somehow possibly involved in the deal, I just didnt understand how your train of thought was even suggesting that.

How is asking whether or not someone offered an opinion implying anything?

My question remains unanswered BTW.

 

[Whileee]

Right. It's like with my HELOC. The source of my payments on that loan is not the equity - the SOURCE of my payments is the revenue I receive from parking fees - erm, I mean from other income I receive from working. The equity backs the HELOC - but it is not the source of the repayment.

Mod: deleted.


There's something else too. Some insist that the revenues identified as the sources of payments (parking revenues and other surcharges and fees) will be insufficient to cover the obligation. That outcome is not a fact, but an assumption, and depending on eventual interest rates, local and national economy, team success and ability to attract corporate sales and sponsorships and develop a wider fan base and future parking revenues, it could be (to borrow from Bill & Ted) 'a most excellent' assumption. So the following assumption that other taxpayer dollars (sales tax, excise tax, whatever tax) will ultimately need to be tapped to cover the obligation; the flaw in their thinking is that somehow they are the only ones who have duped this out and that the city staff lied about it. But again, there's no shell game here - everyone knows that if the revenues fall short - the bonds are backed by more than smiling faces and warm handshakes - they are BACKED by tax dollars. That was clearly said in the council meeting.

Yotesreign, just to make sure that you and others are also keeping up with some of the other relevant issues, here are a few questions that might help to clarify some issues that are pertinent to the GWI's assertions. I've put my answers in parentheses. Feel free to just indicate which of my answers you disagree with.

1) Is a financial analysis of future parking revenues and the net present value of those future revenues relevant to the COG's lease agreement with Hulsizer? (YES)

2) To obtain that financial analysis did the COG retain a nationally renowned expert (Walker)? (YES)

3) Did Walker's financial analysis justify a payment of $100 million to Hulsizer for the rights to future parking revenues? (NO)

4) Did Glendale city administrators inform the public of Walker's analysis prior to the city council meeting during which the lease agreement was to be approved? (NO)

5) Did Glendale city administrators withhold the results of Walker's financial analysis from at least some city councilors? (YES)

6) Did Glendale employ a consultant who is on a hefty retainer to conduct a second analysis of parking revenues (i.e. Hocking)? (YES)

7) Does Hocking have equivalent experience and credentials as Walker to conduct a financial analysis of future parking revenues? (NO)

8) Instead of negotiating a lease with Hulsizer based on Walker's analysis, did city administrators instead use the later and more cursory analysis by Hocking? (YES)

9) During the public council meeting did Ed Lynch state that future parking revenues would be sufficient to bond costs, without informing council or the public that their most credible study on this had shown them that parking revenues would be insufficient? (YES)

10) Did city administrators have a fiduciary duty to inform city council and the public about the financial basis of their agreement to pay Hulsizer $100 million for parking rights? (YES)

 

[OthmarAmmann]

Illinois is issuing $3.7 billion of A1 bonds next week. There is at least another couple billion of higher rated munis the next week too.

http://online.wsj.com/mdc/public/page/2_3022-bondoffer.html?mod=mdc_bnd_pglnk

 

[Coach]

Illinois is issuing $3.7 billion of A1 bonds next week. There is at least another couple billion of higher rated munis the next week too.

http://online.wsj.com/mdc/public/page/2_3022-bondoffer.html?mod=mdc_bnd_pglnk

I know nothing about bonds but previously read the sale could depend on what is available next week. Is it possible to estimate if this is a good week or not?

 

[cbcwpg]

Not going to quote you Whillee , but that's what is at issue here. The GWI has publically stated that they want the team to stay, BUT that has got nothing to do with it. They are there to protect the rights of tax payers and to make sure gov'ts are open about doing business. When you look at Whileee's questions and answer, there is nobody that can change those answers and what has gone on.

The CoG is trying to keep the team by doing everything possible to hide the facts from the taxpayers. GWI job or mandate is to make sure those facts are known. And if they have to sue the CoG, then so be it. That's what they are there for.

 

[CGG]

There will be no suit, becasue the GWI knows they would lose on a constitutional challenge. Their real objective hear is to let public officials know they will be a real pain in the %4#$ if they try to do deals that involve public money. But even the GWI knows they cannot stop every private/public partnership. The City North holding doesn't go that far, and they will never get a better billy pulpit than the current holding. From a litigation strategy standpoint, there is only downside for the GWI's greater mission. The biggest part of being a successful litigator is knowing how to pick your cases.

Again, please explain how GWI "wins" if they don't file a lawsuit. If they let this go through with no legal action, they simply demonstrate that they're impotent. They are not a "pain in the %4#$" to any city that wants to subsidize private money if they don't file a lawsuit. Glendale has basically ignored them until this point and is very publically giving out a subsidy in broad daylight. The next time GWI threatens a municipality they'd just say look at Glendale, a lot of words from GWI but no action, so we'll do the same thing.

GWI's reputation is horribly damaged if they sit back and watch the illegal deal get done without doing anything. That's why they have to act and will act.

 

[Dado]

Logan is the little kid that his parents let stand in front of the CoG council and beg for his team. And after the bonds are sold and the CoG is saddled with more debt than they can handle, Logan will be the first kid to move out of Glendale so he isn't paying this mess off for the rest of his life.

The American Dream, in a nutshell.

 

[Whileee]

Not going to quote you Whillee , but that's what is at issue here. The GWI has publically stated that they want the team to stay, BUT that has got nothing to do with it. They are there to protect the rights of tax payers and to make sure gov'ts are open about doing business. When you look at Whileee's questions and answer, there is nobody that can change those answers and what has gone on.

The CoG is trying to keep the team by doing everything possible to hide the facts from the taxpayers. GWI job or mandate is to make sure those facts are known. And if they have to sue the CoG, then so be it. That's what they are there for.

Folks that say that the GWI won't sue might well be correct. But, then their longstanding legal tussle with the City of Glendale over this would have been a waste of time and money. If anything, the occurrences of the past few months have provided more reason to challenge Glendale on this, not less, with all sorts of concerns beyond simply financial.

Here's another thing to ponder. Last April-May, could even the most ardent supporter have contemplated that a deal such as Hulsizer's would pass muster with the GWI and the "gift law"? Remember, at the time folks seemed quite convinced that Glendale had acted correctly in rejecting IEH's first MOU because Glendale was to guarantee about $5-6 million per annum in CFD revenues to subsidize their losses, if the CFD revenues fell short. Many folks found Reinsdorf's deal to be excessively one-sided and publicly suggested that IEH's was fairer for Glendale. We have come a long way from there, haven't we? Amazing what a "deadline" can inspire, isn't it?

 

[goyotes]

Again, please explain how GWI "wins" if they don't file a lawsuit. If they let this go through with no legal action, they simply demonstrate that they're impotent. They are not a "pain in the %4#$" to any city that wants to subsidize private money if they don't file a lawsuit. Glendale has basically ignored them until this point and is very publically giving out a subsidy in broad daylight. The next time GWI threatens a municipality they'd just say look at Glendale, a lot of words from GWI but no action, so we'll do the same thing.

GWI's reputation is horribly damaged if they sit back and watch the illegal deal get done without doing anything. That's why they have to act and will act.

That's your opinion. No one expects the GWI to sue out every case. They don't need to sue this out and they will not lose credibility if they don't. The only people clammering for them to sue are people in Winnipeg sending them emails telling them to sue. You have seen nothing, or at least very, very little public outcry over this deal. Regardless of whether you find that hard to believe, it is in fact the public perception of what the CoG is doing. Far more people fear an empty arena in what used to be a cotton field.

But again, hope does spring eternal.

 

[kdb209]

Here is another scenario that could play out.

The NHL is already on the record speaking about something needing to be done about the Atlanta market. It sounds like they may very well step in at one point.

So let's entertain that the Coyotes deal will be done and that the bonds will sell for a moment.

What happens in 5 years time when the attendance remains the same and if not worse? The NHL then receives pressure from the BOG to do something.

The BK judge has already made it clear that the NHL controls it's teams with respect to owners and where they play. So if the NHL were to REVOKE MH's Franchee rights and relocate the team to a new owner and new city, what will happen then?

The COG would have no legal standing against the NHL because the NHL controls where the team plays and it's franchise. The fight would be between the COG and MH and then MH has an outclause stating that the NHL revoked my franchise rights.

Wouldn't that VOID any lease agreements between MH and the COG?

The NHL cannot just "REVOKE MH's Franchee rights".

The NHL would need grounds under Article 3.9 of the NHL Constitution for an Involuntary Termination of a Member Club. They have none.