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NHL vs. Balsillie Case Has Large Implications

When the Phoenix Coyotes announced their impending bankruptcy and that the team would be sold, I don’t think anyone could have imagined that the Coyotes would suddenly be the source of excitement for the first time since it was announced Wayne Gretzky was going to be coach of the team.

However, Jim Balsillie’s intent to buy the team and move them to Ontario was not a move Gary Bettman, the NHL commissioner, approved of. He wants to keep the team in Phoenix and not abandon a market that he has spent many years trying to build up. Plus, the issue of the NHL having funded the Coyotes’ finances for most of the past year meant that Bettman felt he could determine the future location of the franchise.

Next week, a judge will rule on whether Balsillie can move the team Ontario if he were to purchase the team. If he rules in favor of Balsillie, then he will be able to break the Coyotes’ lease with Glendale (that was given to them for the new arena) and move them out of town. If the NHL wins, then a new owner of the the Coyotes will be owning a team in the desert.

But, this case has implications on a grander scale. The NBA, MLB, and NFL are supporting the NHL, as they want to have control over who is allowed to own franchises. A win for Balsillie would mean that a team could declare bankruptcy and then a Mark Cuban-type could outbid others and move the franchise elsewhere, regardless of existing agreements. This would make cities much more wary to give rich owners arenas at a discount or for free. An NHL win would mean that if a league funded a team that had an owner (so the Expos situation doesn’t apply here, since they were sold to MLB), then the league could control the club, even if they had not yet asserted control. Either ruling will change the realm of sports ownership.

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One comment for “NHL vs. Balsillie Case Has Large Implications”

  1. [...] Jeremy Jacobs Leading Fight Against Balsillie By Erikk in Bruins, Featured ⋅ August 12, 2009 at 8:30am ⋅ Post a comment Jeremy Jacobs, owner of the Boston Bruins and current chairman of the National Hockey League’s Board of Governors, is leading the fight against Canadian billionaire Jim Balsillie. Last Friday, Jacobs and 25 other governors (a representative from each team) voted 26-0 against Balsillie’s application to buy the bankrupt Phoenix Coyotes. [...]

    Posted by Jeremy Jacobs Leading Fight Against Balsillie | Sports of Boston | August 12, 2009, 8:31 am

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