Monday, June 15, 2015

Glendale Sued For $200 Million For Canceling AZ Coyotes Lease

Arizona's NHL Team Sues Glendale for $200 Million for Canceling Lease

PHOENIX (CN) - The National Hockey League's Arizona Coyotes sued Glendale, Ariz. for $200 million for terminating its 15-year lease early, and a judge immediately restrained the city from acting.
     A Superior Court judge granted the team a temporary restraining order Friday to keep Glendale from canceling the lease agreement.
     The NHL called Glendale's act "outrageous and irresponsible."
     IceArizona Hockey, which owns the NHL team, sued Glendale, its City Council, city manager and city attorney on Friday in Maricopa County Court.
     The Glendale City Council voted 5-2 on June 10 to terminate a 2013 agreement to allow the Arizona Coyotes - formerly the Phoenix Coyotes - to play hockey at Glendale's Gila River Arena for 15 years.
     Glendale claimed last week there was a conflict of interest in negotiations, then the City Council voted to kill the lease.
     The city claimed the conflict was that IceArizona hired former Glendale City Attorney Craig Tindal as the team's general counsel in 2013.
     But the team said in its lawsuit: "For at least the last 19 months, the city did not object to that employment ... nor express a single concern to plaintiffs about Mr. Tindall's employment with them."
     It claims that Tindall "did not initiate, negotiate, secure, draft, or create the agreement."
     It also claims that Tindall's and Glendale's severance agreement waived any conflict "of employee or a law firm with which employee may become affiliated regarding transactional matters previously handled by employee for the city."
     Glendale asked Anthony LeBlanc - co-owner of IceArizona - to attend a "meet and greet" with city officials on June 8, and to bring along Andy Barroway, the new co-owner of Ice Arizona.
     "Simply put, the meeting was an ambush" set up by Glendale, to try to force IceArizona into renegotiating the lease, the team says in the complaint.
     "The city officials informed plaintiffs that they believed they had legal grounds to cancel the agreement, but they never stated what those grounds were, that they were going to seek to cancel the agreement, or that they were going to try to do so starting the very next day," the lawsuit states.
     In a June 9 executive session, the City Council discussed canceling the lease, and on June 10 did so, based on claims that "former employees of the city who now work for plaintiffs 'heavily influenced and quietly assisted in the final negotiations of the contract.'"
     The team claims Glendale thereby hurt the Coyotes' ability to schedule and promote home games for the 2015-2016 season, its ability to attract fans, staff, and vendors, and to bid to host the International Ice Hockey Federation's World Junior Championship.
     "State law is clear and quite transparent regarding the behavior of state employees during contract negotiations and after," interim Assistant City Manager Tom Duensing said in a statement. "In fact, we operate under rules about transparency and the public's right to know. Although we understand the disappointment of hockey fans, this really isn't about the game; it's about the public trust."
     The NHL called Glendale's vote "outrageous and irresponsible."
     "We continue to proceed on the basis that the Coyotes will remain in Glendale and will be playing their home games at Gila River Arena," the NHL said in a statement.
     IceArizona seeks declaratory judgment that Tindall was not involved in the lease negotiations; that Glendale waived its claim to a conflict in its severance agreement with Tindall; and that the vote to cancel the agreement is void.
     IceArizona is represented by James Condo with Snell & Wilmer.
     Glendale, pop. 230,000, is just northwest of Phoenix.  

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