Glendale votes to cancel agreement with Coyotes, who threaten to sue for $200 million
With most of the hockey world focused on Game 4 of the Stanley Cup Final, a drama of a different kind was unfolding in Arizona, where the City of Glendale voted to cancel its arena-management agreement with the Arizona Coyotes.
The decision by city council once again throws the future of the Coyotes in Glendale up in the air.
“We are disappointed with the city’s decision to violate its obligations under the agreement that was entered into and duly approved only two years ago,” said Coyotes co-owner, president and CEO Anthony LeBlanc in a release. “We will exhaust any and all legal remedies against the city of Glendale for this blatant violation of its contractual obligations to us.”
The departure of former city attorney Craig Tindall’s from his position more than two years ago was central to the argument to cancel the agreement.
Tindall was asked to resign as city attorney in February 2013 by Weiers. Tindall left his position on April 1, 2013, but accepted six months of severance, meaning he was on the city payroll through Oct. 1, 2013.
The city and Coyotes reached their arena management deal on July 2, 2013, when Tindall, who had gone to work for the Coyotes, was still being paid by the city.
The city in its vote Wednesday relied on state statute 38-511. That statute, which is included in the arena management deal, says that the state can cancel a contract within three years if anyone involved in negotiating or drafting the contract for the state or any public department, is an employee of any party to the contract (the Coyotes).
Prior to the vote, Coyotes lawyer Nick Wood threatened litigation:
Wood: "If you act on this tonight, tomorrow the litigators go to work.— Rick Westhead (@rwesthead) June 11, 2015
There will be claims of $200M."
Meanwhile, on Hockey Night in Canada, NHL commissioner Gary Bettman stated: “I’m not concerned about the Coyotes. If I lived in Glendale, I’d be concerned about my government.”
Where this goes from now is uncertain. But what’s clear is that significantly more damage to the Coyotes’ already-tenuous relationship with the city has been done.
Oh, and one other thing that’s clear?
The lawyers will be busy.
Update: Here’s video of LeBlanc’s reaction, courtesy the Coyotes website...