Phoenix XXVIII: Lawyers, Bonds and Money

[MountainHawk]

Why wouldn't you buy the Coyotes yourself? You'd be putting in more than Hulsizer!

Because I wouldn't have the cash flow to sustain the losses for the next couple of seasons until I was inevitably able to turn it around & lead the Coyotes to 5 straight Stanley Cup titles.

 

[Whileee]

Just checking in from yesterday (and yet a whole thread removed) to take my lumps. Having insisted that the GWI would not sue, it appears they will sue when the deal closes. Heap on the "I told you" so's. I was wrong.

Having said that, I simply cannot believe this is the course they charted. This could indeed by their Waterloo. Best case is they win and get blamed for all the problems Westgate will present. Everyone (unfairly so IMO) will assume Westgate would have been a great success had the Coyotes stayed. The public will blame the GWI. Worse case is they lose, expose themselves and their directors to affirmative claims, and regardless, become responsible for having cost the taxpayers money.

The tide of public opinion down here has really turned against the GWI. A recent poll of over 5,000 participants surveyed had 72% in favor of the CoG's decision. Previously uncommitted media are now coming out and questioning the GWI and its motives. The Coyotes have been the lead story on TV news and sports. All the news has been pro-Coyotes staying and pro-CoG. Most have at a minimum questioned the GWI, and some have been openly critical. Fox10 news last night is just an example (yes, the same Fox Network).

Anyway, I will take my lumps now. "Thank you sir, may I have another."

I would never want to say "I told you so" in this saga. Who can predict anything with any certainty?

But I would ask you to reference the "poll" of 5,000 participants. I hope that is not an online "poll" through a media outlet that permits anonymous users to "vote" as many times as they wish.

 

[Grumpz]

OMG, the guy they quote is an insurance defense lawyer from a 20 lawyer firm in Fargo, ND!!! You do realize that the CoG has Snell & Wilmer (Arizona's largest law firm), Fennemore Craig (Arizona's oldest law firm) and Greenberg Traurig (one of the largest US law firms) as counsel who have all opined (and put their butts on the line) that this deal does not violate the Gift Clause.

Based on numbers provided to them by the CoG that justify $100 million for parking rights, and under the assumption that the CoG doesn't arleady own these parking rights.

 

[LeftCoast]

With that kind of firepower, why didnt CoG move for a finding from the courts to remove the spectre of a lawsuit? Could they not have done it months ago?

The only plausible reasons for not seeking declarative relief would be a lack of confidence in the merits of their case and wishful thinking that they could negotiate with an ideologically driven organization.

 

[goyotes]

Based on numbers provided to them by the CoG that justify $100 million for parking rights, and under the assumption that the CoG doesn't arleady own these parking rights.

According to the press release of the GWI, ownership of the parking rights is not one of the reasons the deal violates the Gift Clause. They articulated their claims and to their credit it looks like they have dropped that argument. It now rests on whether the parking revenue will provide adequate consideration, and whether they are lending their credit to MH to buy the team.

 

[goyotes]

There would be a press release following the closing of a private placement.

Thanks.

 

[OthmarAmmann]

But I would ask you to reference the "poll" of 5,000 participants. I hope that is not an online "poll" through a media outlet that permits anonymous users to "vote" as many times as they wish.

Well considering that's 2% of the population of Glendale...

 

[goyotes]

With that kind of firepower, why didnt CoG move for a finding from the courts to remove the spectre of a lawsuit? Could they not have done it months ago?

I believe they operated under the mistaken belief that the GWI would not follow through on litigation and would back down (lot of that going around lately).

 

[PeaSouper]

Corporate issuers would have to file news of the sale with the SEC. I imagine municipal borrowers would have to do the same.

Privately placed munis are generally exempt from SEC registration, although I think it's standard practice (not legally required, though) to run a tombstone ad after the sale is completed.

 

[Whileee]

According to the press release of the GWI, ownership of the parking rights is not one of the reasons the deal violates the Gift Clause. They articulated their claims and to their credit it looks like they have dropped that argument. It now rests on whether the parking revenue will provide adequate consideration, and whether they are lending their credit to MH to buy the team.

As I noted previously, I don't think that we should assume that the GWI's legal strategy will be based solely on their public releases. If they are really serious about a lawsuit, then I would assume that we might not know the full extent of their case until they file a suit.

 

[Donwood]

I just sent a message to the Free Press's Gary Lawless asking him to confirm Goldwater stated to him they would seek an injuction.

 

[Whileee]

Well considering that's 2% of the population of Glendale...

Ummm... you're assuming that they were Glendale residents?

 

[CasualFan]

This will not be of interest to everyone and I apologize for the lengthy post. I could not resist taking a quick trip through the BK docket to determine where the parking rights issue stands. I tried to take the legalese out so it would be easier to read, as such, I acknowledge that not everything presented here is as accurately described as it could be.

8/25/10 Moyes submits motion for Amended Plan.
The Motion pushes out the estimated rejection date from June 30, 2010 to June 30, 2011 provided that Moyes receives lower rate for damages. Or put simply, he wont reject the Glendale Contracts as long as they lower the amount he has to pay if they are rejected.

9/13/10 Moyes motions to re-estimate the damages for rejecting Glendale Contracts

10/6/10 Baum signs order to estimate claims.

11/3/10 At Hearing, Counsel Kroop advises the court that there has been positive negotiations between Moyes, Glendale, and NHL. There is an agreement in principle to submit an Amended Plan.

12/1/10 Motion to Approve Amended Plan, including language that Glendale Contracts can be assumed and assigned or rejected until June 30, 2011 as per a Transition Agreement between the Moyes entities and the NHL entities.

2/21/11 Moyes declaration in support of Amended Plan

2/23/11 Hearing on Amended Plan

2/24/11 Order approving Amended Plan by Baum.

Note: The amended plan does convey to the City of Glendale the rights under Agreement for the Replacement of Temporary Parking, dated as of July 1, 2008. However, this is not an agreement that involves the rights to parking. It is the agreement that requires Ellman to build a garage. Not coincidentally, after the city received those rights they cut a deal with Ellman to split the $25MM in escrow that was set aside to build the garage.


In the end, per the Moyes and NHL agreement, the parking rights are still sitting out there in the Glendale Contracts awaiting to be assumed and assigned or rejected. Did the NHL leverage their civil suit against Moyes in order to obtain the transition agreement? If the Hulsizer deal closes and Goldwater sues, how will a judge view the assumption, assignment, and subsequent $100MM payment? It will be very interesting to see.

 

[cbcwpg]

I couldn't take this thread anymore, so I'm just going to win Megamillions on Friday and donate the $100M to Glendale.

I'm sure I could find you much better things to blow $100M on before giving it to the CoG. IE: spreading it around to all the posters on this forum except for the self proclaimed lawyers. They're rich enough.

 

[zimmy61]

Privately placed munis are generally exempt from SEC registration, although I think it's standard practice (not legally required, though) to run a tombstone ad after the sale is completed.

I'm not sure how it works in the U.K. or U.S., but in Canada a press release is issued with all of the salient details upon closing. A tombstone would be at the discretion of the lead.

However, with so much public interest in this bond issue, along with the heavy press scrutiny, I can't imagine the deal would go through without word getting out almost immediately. I think it's reasonable to assume that until we hear confirmation, that nothing's been done.

 

[OthmarAmmann]

Privately placed munis are generally exempt from SEC registration, although I think it's standard practice (not legally required, though) to run a tombstone ad after the sale is completed.

I was thinking that the issuance of the debt would be a material change for the registered securities. Whatever.

 

[MountainHawk]

The entertainment from the meltdown that would come from the teams staying in Glendale would be worth $100M to me.

 

[cbcwpg]

OMG, the guy they quote is an insurance defense lawyer from a 20 lawyer firm in Fargo, ND!!! You do realize that the CoG has Snell & Wilmer (Arizona's largest law firm), Fennemore Craig (Arizona's oldest law firm) and Greenberg Traurig (one of the largest US law firms) as counsel who have all opined (and put their butts on the line) that this deal does not violate the Gift Clause.

It's not the size of the firm that matters. The law is the law everywhere ( with respect to pursuing it ), and a lawyer in a small firm is no less capable than a lawyer in a large firm. The only difference is the big firm will charge you more for the same service.

 

[Donwood]

I couldn't take this thread anymore, so I'm just going to win Megamillions on Friday and donate the $100M to Glendale.

Just think what Glendales city council could do with 100 Million. Fight a casino, buy some parking spaces. Hire a writer for some snappy comebacks to Goldwater quotes, pay for a therapist for Gary Bettman, The list goes on.

 

[LeftCoast]

I believe they operated under the mistaken belief that the GWI would not follow through on litigation and would back down (lot of that going around lately).

If that is what they were hoping they were naive. Ms. Olsen's performance has pretty much guaranteed her first call on the Glenn Beck, Bill O'Reilly, Sean Hannity right wing propaganda gravy train. She could be bigger than Anne Coulter, maybe even Sarah Palin. And unlike Coulter, they won't have to apologize to sponsors when she uses racial and gender slurs or when she's fast and loose with the truth. Unlike Palin, they won't have to explain how she's not really as gosh darned dumb as a post.

I smell a book deal and promotional tour.

 

[Donwood]

Lawless said Goldwater will not reveal there exact strategy but an injunction is a potential tool.

So much half truths and speculation out there, you have to take almost anyhting with a grain of salt.

 

[Krautso]

If that is what they were hoping they were naive. Ms. Olsen's performance has pretty much guaranteed her first call on the Glenn Beck, Bill O'Reilly, Sean Hannity right wing propaganda gravy train. She could be bigger than Anne Coulter, maybe even Sarah Palin. And unlike Coulter, they won't have to apologize to sponsors when she uses racial and gender slurs or when she's fast and loose with the truth. Unlike Palin, they won't have to explain how she's not really as gosh darned dumb as a post.

I smell a book deal and promotional tour.

Thats what I was thinking. Whoever made that decision to roll the dice on a deal worth hundreds of millions of dollars, when every lawyer they can find tells them its a slam dunk...the term due dilligence comes to mind. GWI was a loose end that needed to be tied up a long time ago.

Needless to say..heads should be rolling all over the desert when this is done.

 

[Grumpz]

According to the press release of the GWI, ownership of the parking rights is not one of the reasons the deal violates the Gift Clause. They articulated their claims and to their credit it looks like they have dropped that argument. It now rests on whether the parking revenue will provide adequate consideration, and whether they are lending their credit to MH to buy the team.

I'm no lawyer, but near as I can tell, that was just a statement. Does it need to contain the 100% of their issues with the the agreement?

 

[billy blaze]

Sunnucks on PTS with McCown and Grange

http://www.fan590.com/media.jsp?content=20110316_170140_8668

- GWI suing on principle- private sale issue
- public campaign by NHL and COG emboldened GWI
- taxpayer hurting in Glendale, raising water rates while giving Hulsizer 197m
- Sunnucks thinks older folk of Glendale against deal, businesses for deal
- Grange states Glendale only half finished sports mega centre (investing all in sports industries)- can't finish- Sunnucks agrees
- Sunnucks says you can questions Glendale's thought process
- Sunnucks Glendale suing GWI helps no one

 

[Killion]

If that is what they were hoping they were naive. Ms. Olsen's performance has pretty much guaranteed her first call on the Glenn Beck, Bill O'Reilly, Sean Hannity right wing propaganda gravy train. She could be bigger than Anne Coulter, maybe even Sarah Palin. And unlike Coulter, they won't have to apologize to sponsors when she uses racial and gender slurs or when she's fast and loose with the truth. Unlike Palin, they won't have to explain how she's not really as gosh darned dumb as a post.

Whether they were naive, underestimated the resolve of GW, or planned to ram it through at the last minute in a deluge of "recently released" paperwork, maybe all three, who knows?. Why they didnt seek a courts opinion in December, missing that opportunity; then again in January; missed again; February, yepp, slipped right by; is just nonsensical to my untrained legal mind, given the time (months) they've had to craft the deal and execute,