SBD/March 21, 2011/FranchisesPrint All
Mets co-Owners Fred Wilpon and Saul Katz "went on the legal offensive late Sunday, filing court papers that accused the trustee in the Bernard Madoff fraud case of making a host of false allegations, and unveiling their legal strategy to combat the trustee's effort to claw back over $1 billion in profits and investments from the Ponzi scheme," according to Anthony DeStefano of NEWSDAY. Wilpon and Katz said in a statement, "After months of damaging leaks, false accusations and withholding of evidence, we can finally legally respond to the work of fiction created by the trustee. Let us be very clear: We did not know that Madoff was engaged in a fraud." In court filings, the Wilpon family and their partners at Sterling Equities said that "under the law they can't be compelled to return the money because they weren't aware of the fraud." A Sterling legal memo reads, "A customer has no way of knowing what his broker is actually doing" (NEWSDAY, 3/21). The Mets owners charged that the trustee "had repeatedly ignored or misrepresented evidence that showed they had no good reason to have suspected Mr. Madoff was operating a fraud during their many years of investing with him." When Wilpon was asked in his deposition whether he understood how Madoff made money off his investment business, he responded, "Not in any kind of depth" (N.Y. TIMES, 3/21). In N.Y., Thompson, Vinton & O'Keeffe report lawyers for Wilpon and Katz "filed a motion to dismiss and a motion for summary judgment Sunday night in their first forceful shove back at litigation that has put their integrity at question." David Sheehan, counsel for Madoff trustee Irving Picard, responded last night, saying, "The Katz Wilpon defendants are wrong on the facts and the law" (N.Y. DAILY NEWS, 3/21).
DID PICARD OMIT EVIDENCE? In N.Y., Mark DeCambre reports the Mets' complaint "attempts to show that Picard intentionally omitted evidence that would have been 'overwhelmingly favorable to the Sterling Partners that are directly contrary to the evidence available before the complaint (by the trustee) was filed'" (N.Y. POST, 3/21). Sterling Equities "disputed Picard's contention that Peter Stamos, the head of the separate investing firm Sterling Stamos, told Sterling Equities that Madoff's returns were 'too good to be true.'" Sterling Equities "contends that Stamos testified the opposite" (Newark STAR-LEDGER, 3/21). ESPN N.Y.'s Adam Rubin reported the Mets' response to Picard's complaint "quotes from fund manager Peter Stamos' deposition in which, asked if he ever communicated to the Wilpon family it may be too good to be true, Stamos said: 'I can't ever recall using those words to describe Mr. Madoff.'" The response also indicated that Stamos "did not advise the Wilpons to avoid investing with Madoff," rather that Stamos "only recommended they diversify their investments and invest no more than 10 percent in one place." That "directly contradicts an email in the original complaint" (ESPNNY.com, 3/20). The WALL STREET JOURNAL's Michael Rothfeld notes the "back-and-forth legal action signals that settlement negotiations between the two sides, despite the aid of a court-appointed mediator, former New York Gov. Mario Cuomo, haven't gained traction" (WALL STREET JOURNAL, 3/21).
PICARD SEEKING MORE THAN $1B: ESPN N.Y.'s Rubin reported Picard "officially wants more than" $1B from the Mets owners. In an amended lawsuit filed Friday, Picard now officially seeks more than $700M in "alleged fraudulent transfers of principal." That is "in addition to $300 million in alleged fictitious profits." Picard "filed court papers Friday saying the cozy relationship between the Mets and the Madoff family was demonstrated with a 2004 bridge loan for $54 million that the family provided the team's owners." Picard said that the bridge loan was "documented by a single letter agreement that falsely described the loan as an 'investment' by Madoff's wife, Ruth, in the company that would later become the SNY network." But Mets Exec VP & General Counsel David Cohen said that the $54M, "representing funds the Sterling partners had invested with Madoff, was never used" (ESPNNY.com, 3/19). Wilpon and Katz said in a statement, "The amended complaint is the latest chapter in the work of fiction created by the Trustee" (Newark STAR-LEDGER, 3/19). In N.Y., Thompson & Vinton reported the new complaint "claims to 'shed more light' on the deep dependency of Sterling on its Madoff investments." However, a source close to the litigation said he "did not see anything new of consequence" in the document (N.Y. DAILY NEWS, 3/19).
SNY OFF THE TABLE: The WALL STREET JOURNAL's Futterman & Schechner cited sources as saying that Time Warner Cable and Comcast officials "would be unlikely to allow" the Mets owners to "sell part of their stake in the jointly owned" SportsNet N.Y. That stance "could complicate the team owners' efforts to sell a minority stake in the franchise to raise cash." One source added that "prospective investors in the Mets won't be provided with financial information about the team's cable network" (WALL STREET JOURNAL, 3/19). Meanwhile, in N.Y., Richard Sandomir reports "over the next week to 10 days, five to eight possible bidders for a minority stake in the Mets will take a first step to making an offer by examining the team's financial records" (N.Y. TIMES, 3/21).BID GROUPS APPROVED TO LOOK AT METS' RECORDS
Goldman Sachs Global Securities Division co-Head David Heller and Apollo Global Management President Marc Spilker BTIG co-Founder Steve Starker and Marquis Jet co-Founder Kenny Dichter 1-800-Flowers Founder James McCann and SkyBridge Capital Managing Partner Anthony Scaramucci Clarion Capital Partners Managing Partner Marc Utay and former YES Network Chair & CEO Leo Hindery
Prospective Coyotes Owner Matthew Hulsizer yesterday said that he "has changed the terms by which he would purchase the franchise in an effort to assuage legal concerns raised by the Goldwater Institute," according to the AP. Under the terms of the lease Hulsizer negotiated with the City of Glendale, the city agreed to sell $100M in bonds that will "go toward the purchase price of the team from the NHL." Hulsizer yesterday said that he "will guarantee $75-million of the bonds which he said will negate legal concerns about possible violation of the gift clause." He said that the other $25M "already was going to be paid in cash to the city." Hulsizer: "I'm on the record as saying that I should not move on the deal. I don't feel like I should. It's a free market. I'm signing up to take on losses that would otherwise be borne by the Glendale and Arizona taxpayers. However, the deal needs to move forward" (AP, 3/20). ESPN.com's Scott Burnside noted the move "follows behind-the-scenes discussions involving Arizona senator John McCain and former state attorney general Grant Woods, both of whom believe it's important that the Coyotes remain in Glendale, and officials with Goldwater." Hulsizer "presented a letter to the Goldwater Institute Friday outlining his concessions," and multiple sources said that the Goldwater Institute "has not responded to Hulsizer's change of heart." Those concessions came "after some intervention by McCain and Woods in recent days." Meanwhile, sources said that buyers for the bonds "are in place, and that if Goldwater backs off the bonds will be sold quickly" (ESPN.com, 3/20). McCain said yesterday, "It is to the greater good of the state of Arizona that the Coyotes remain here" (ARIZONA REPUBLIC, 3/21).
WHAT IF COYOTES LEFT? In Phoenix, Dan Bickley wrote, "If the Coyotes were forced to leave, the fallout would be more emotional than financial. Some sponsorship dollars would be reallocated among existing teams. The lowest price point in the market -- affordable suite deals at Jobing.com Arena -- would be eliminated. Yet the impact among competitors isn't Earth-shaking, and there would be little migration of hockey fans to other stadiums across the Valley." D'Backs President & CEO Derrick Hall said, "We think four teams are better. We can easily support four teams. We don't share the same ticket holders. I think we need all four." Suns President & CEO Rick Welts: "Our belief is we are rooting for them to stay. If they leave, it will change the way people view us as a big-league market. National advertisers pay attention to that" (ARIZONA REPUBLIC, 3/20).
More than 23,000 "stamping, chanting, cheering fans jammed" Empire Stadium on Saturday night for the Vancouver Whitecaps' first MLS game, a 4-2 victory over visiting Toronto FC, according to John Colebourn of the Vancouver PROVINCE. Whitecaps fans prior to kickoff "unfurled two giant blue and white banners each bearing" a huge "V" and sang, "Take Me Home, Boundary Road." Whitecaps coach Teitur Thordarson said, "The atmosphere was electric. The supporters were like a team. It looked as if they had been training for a long time" (Vancouver PROVINCE, 3/20). The game was "delayed several minutes" after Whitecaps fans celebrated the team's first goal by "hurling little packets containing giveaway white ponchos" (TORONTO STAR, 3/20). In Vancouver, Cam Cole noted after the game, the Whitecaps players did not want "to leave the field because the scene was just so damned much fun." Whitecaps CEO Paul Barber: "We said from the start we wanted the atmosphere to evolve organically, and it did. We did our little bit at the start, and then the people of Vancouver took over and just made a party -- and what a party it was" (VANCOUVER SUN, 3/20).
CONTINUING A TREND: The GLOBE & MAIL's Matthew Sekeres writes, "Should Major League Soccer become a greater commercial success across Canada, then March 19, 2011, will go down as seminal day." The first match between Canadian clubs was a "massive triumph as nearly 23,000 scarf-wearing partisans packed into Empire Field for the Whitecaps’ thrilling 4-2 victory." MLS Commissioner Don Garber, attending the game, said, "We kind of have a Lakers-Celtics thing going on here, where two teams across the country can get at each other." Sekeres notes that "became apparent late in the first half when one pocket of Whitecaps fans turned to several hundred TFC supporters and chanted 'we’re going to make the playoffs,' a taunt that proved they were aware of the Reds struggles over four MLS campaigns" (GLOBE & MAIL, 3/21). YAHOO SPORTS' Martin Rogers wrote the atmosphere at Empire Field indicated that MLS has "continued its recent trend of backing a winner." From "Toronto itself to Seattle and now further north, new markets have brought big crowds filled with color and passion and a feeling for the game," and now Vancouver "can happily join that company." Suns G and Whitecaps investor Steve Nash, who was also in attendance, said, "We wanted to create an authentic soccer atmosphere here and there is no question that has happened." Rogers added, "Vancouver is always going to be a hockey town but soccer lives and breathes healthily here" (SPORTS.YAHOO.com, 3/19).
ROAD WARRIORS: The Timbers also made their MLS debut on Saturday, losing 3-1 at the Rapids, but in Portland, Rachel Bachman wrote the Timbers Army fan group "showed why MLS is happy to have the Timbers among its 18 teams." The "scarf-snapping, song-belting Army, already one of the largest and most unified supporters' groups in MLS, forms the heartbeat of the reborn top-division Timbers and is an example the league hopes will spread." Rapids Dir of Media Relations Jason Gilham said that "at least 423 Timbers fans, most of them sitting with the Army, bought tickets to the game, far more than any other visiting supporters' group had before" (Portland OREGONIAN, 3/20).
Hundreds of Twins fans were "left empty-handed and infuriated Saturday after a server problem snarled online ticket purchases for what team officials insisted were a 'relatively small' number on the first day of single-game ticket sales," according to Abby Simons of the Minneapolis STAR TRIBUNE. Fans "deluged the site for tickets in unprecedented numbers, then stormed Twitter and Facebook to vent about waiting for hours to purchase tickets, only to be greeted by a 'white screen of death' when they reached the front of the virtual line." Server glitches and "repairs on the ticket-ordering website appeared to kick customers out of their place in line starting at noon." Team officials initially said that "those greeted by a white screen had not lost their place." But at 4:00pm CT, Twins Exec Dir of Public Affairs Kevin Smith indicated that that was "no longer the case and that fans running into the glitch would have to start over again." Smith estimated that "only a few hundred users encountered the problem, one he said that originated with the Twins' online ticketing partner, Tickets.com." Smith said that despite the problem, tickets "were still selling at a pace about 20,000 ahead of last year," demand "not seen since the 1987 World Series." More than 100,000 tickets were sold during last week's presale to season-ticket holders. Smith said, "This is not a sky-is-falling scenario" (Minneapolis STAR TRIBUNE, 3/20). Smith said ticket sales yesterday went "smooth as silk." He noted that it remains unclear "whether the demand contributed to the computer problems" on Saturday. But Smith said that yesterday, "waits were short or nonexistent" (Minneapolis STAR TRIBUNE, 3/21).
NO SOPHOMORE SLUMP: In Minneapolis, Sid Hartman notes the Twins are "not only the hottest ticket in this area but also in all of major league baseball." They drew more than 3 million fans last year in the first season at Target Field, and Twins President Dave St. Peter said that the club "could exceed that total after selling just shy of 250,000 of the 500,000 tickets available for the entire season since Friday." St. Peter said that "there are still plenty of tickets available for a lot of games, particularly in April, May and September, and that the team is not sold out for the season." He added that "for the most part, Opening Day on April 8 against Oakland is sold out, but like last year, as game days approach some additional tickets will be released." St. Peter: "We will have a release in the next couple of weeks about the plan for standing room in 2011. Those seats have not been put out in the system yet" (Minneapolis STAR TRIBUNE, 3/21).
The "talk of furloughs and pay cuts percolating through the halls" of some NFL teams is "not heard" around the Saints, according to James Varney of the New Orleans TIMES-PICAYUNE. Saints Owner Tom Benson: "This is pretty much business as usual for us. I don't want our employees to feel sorry for themselves during this period of time. So we're not laying anybody off, and we're not cutting anybody's pay." Benson added of the NFL labor dispute, "Nobody wins in the courtroom, as far as I'm concerned. We've got to just sit down and work this out together and what's good for this game and the future of this game. If it costs so much to do business, then you've got to raise prices more. We've got to stabilize this thing across the board, and you've got to hold your costs someplace. And this is what we're trying to do." Varney noted NFL owners began meeting in New Orleans yesterday, and Benson "lobbied hard to get the meeting in New Orleans, an effort that began long before the current labor impasse, and was tied to the city's successful effort to land Super Bowl XLVII in 2013." Benson said the Saints have renewed 98% of season tickets. Benson: "That's money in the bank" (New Orleans TIMES-PICAYUNE, 3/20). Meanwhile, Texans Owner Bob McNair said that he "will not make employees take pay reductions or work furloughs unless games are canceled and the team has to refund season-ticket revenue." McNair: "We're not going to do that until we have to." McNair also said season-ticket sales are "slightly off from last year's pace, which was a record" with more than 64,000. McNair: "We're close to where we were last year. It's in line with what it was the year before" (HOUSTON CHRONICLE, 3/21).
STANDING ALONE: In N.Y., Bart Hubbuch notes the Giants are the "only team in the league not to require a payment from its season-ticket holders during the lockout." Giants President & CEO John Mara: "We've asked an awful lot of our season-ticket holders over the last few years in connection with this new stadium, so it was a gesture that (co-owner) Steve Tisch and I thought was a reasonable one to make. ... Everybody has their own individual circumstances. We shouldn't be singled out. I don't know that anybody asks what we've asked of our ticketholders that last few years" (N.Y. POST, 3/21). In contrast, the Steelers "expect fans to make season-ticket payments for the 2011 season." Steelers President Art Rooney II in a letter to season-ticket holders said, "Payments are due, consistent with past practices. ... We will provide refunds for any games cancelled." Payments are "due in full by May 2" (Pittsburgh TRIBUNE-REVIEW, 3/19). Meanwhile, in St. Louis, Jim Thomas reported the Rams have sent a letter to season-ticket holders and sponsors, saying that "while frustrated that a new labor agreement is not in place, the Rams remain committed to the collective bargaining process and to federal mediation." The letter, which is signed by Rams Exec VP/Football Operations & COO Kevin Demoff, also "details the team's commitment to community service, charitable work, and being fan-friendly" (ST. LOUIS POST-DISPATCH, 3/20).
TOUGH TIMES IN TITLE TOWN: In N.Y., Bill Pennington noted the NFL lockout and the "threat of a canceled 2011 football season have disquieted fans in many American cities, but the unease in Green Bay is profound and multilayered." Pennington noted the Packers "have yet to accept an invitation to the White House, since team leaders did not think President Obama would want to welcome only Packers executives and coaches." They also "have not ordered their Super Bowl rings because they want to consult with the players, whom they are prohibited from contacting during the lockout." Green Bay Alderman Ned Dorff: "What a bad month. As one of my friends told me, 'I'll never forgive the NFL and [Wisconsin Gov.] Scott Walker for killing my Super Bowl buzz'" (N.Y. TIMES, 3/20).
In L.A., Dylan Hernandez reports MLB Commissioner Bud Selig Sunday during a visit to Dodgers' Spring Training yesterday "maintained his longstanding silence" regarding the divorce proceedings involving Owner Frank McCourt and his ex-wife, Jamie. This was "despite being told that fans in Los Angeles were probably waiting for him to address the matter." Selig said, "It's a situation that I've monitored and am monitoring very closely and I think any comment from me at this point is inappropriate" (L.A TIMES, 3/21).
LOOKING AT THE STARS: In Dallas, Eddie Sefko reported Mavericks Owner Mark Cuban "continues to do exploratory work on the possibility of buying the Stars, who are co-tenants with the Mavericks" at American Airlines Center. But he added that it is "going to take a collaboration with somebody -- at least at this point -- for him to make something happen." Cuban: "I'll help anybody who gives me a better shot at the rest of the arena. ... I'm going to let someone else do the work" (DALLASNEWS.com, 3/18).
NEW VIBE: In Denver, Chris Dempsey notes Nuggets attendance "had waned this season as apathy set in surrounding the quality of play" and the "drama" surrounding F Carmelo Anthony, whom the team traded to the Knicks last month. But Nuggets CMO Kurt Schwartzkopf said there is "definitely a positive trend going" regarding the team's ticket sales. Schwartzkopf: "A lot of fans were waiting to see, and now they see a product they can get behind. I think that's translated into ticket sales, no question." Dempsey writes that "might have never been more obvious than in the team's sellout of its last home game -- against the lowly Detroit Pistons" March 12 -- which "became the team's eighth sellout of the season, and first for the revamped Nuggets" (DENVER POST, 3/21).
REACHING SECOND: The A's and ad agency Hub Strategy are introducing the second season of their "Green Collar Baseball" campaign, which features TV, radio, print, outdoor and digital ads. The "Green Collar Baseball" slogan will be integrated throughout the A's marketing and advertising this season (A's).