Our bi-monthly hockey's business and legal highlights for the period of May 16 through May 31 includes Arizona Coyotes.

Hockey’s Business and Legal Bi-Monthly Highlights May 16th Through 31st Featuring A Heartbreak for the Arizona Coyotes

Alec Roberson

It’s that time of the month when we take a look at what’s been happening in hockey’s business and legal world. Twice a month we cover the big and not so big stories in this arena. We also include a featured story of the period. Let’s take a look at what has been happening this period.

Hockey’s Business and Legal News

Hearing Set for Class Certification in Concussion Lawsuit Against CHL

The judge in the concussion class action lawsuit against the WHL, CHL and Hockey Canada set October 25 through 27, 2023 to hear arguments as to why this action should proceed as a class action lawsuit. Class action lawsuits must be certified before they can proceed as a class action. Former CHL players brought this lawsuit alleging that the CHL, its member leagues and teams responded inadequately to their concussion related injuries medically. They also claim to still suffer lasting effects. This lawsuit came shortly after the NHL settled it’s concussion lawsuit following a U.S. Court denying class certification. The CHL is also dealing with a lawsuit related to abuse and harassment and settled another lawsuit dealing with CHL players legal status as employees. With their hands full, it will be interesting to see if this lawsuit will proceed as a class action suit.

Bids Submitted for Purchase of Ottawa Senators

The deadline to submit bids for the purchase of the Ottawa Senators ended on May 15, 2023. Reportedly, four groups submitted bids out of the potential six interested. This included one reportedly at one billion dollars. The groups led by Michael Andlauer, Jeffrey and Michael Kimel, and Steve Apostolopoulos, and Los Angeles-based producer Neko Sparks each submitted bids.

The sale of the Senators, now owned by Eugene Melnyk’s daughters, has garnered a lot of buzz. Ryan Reynolds, Snoop Dog and the Weeknd have all shown interest in owning the team. Galatioto Sports Partners is assisting the family in the sale of the team. GSP with the family will have to heavily consider the offers and decide how they would like to proceed. Reportedly, Anna and Olivia Melnyk would like to retain ten percent ownership of the Senators. The sale is also conditioned on the team staying in Ottawa. The sale will be a long process but keep an eye on this story as it moves forward.

We previously wrote a three-part series on the process of purchasing an NHL team. Unfortunately for those excited about Reynolds, it sounds like he is out.

The Sparks Group’s Bid

Looking at the Senators further, Snoop Dog announced that the Neko Sparks group (to which he is a part) will include equity for Canada’s First Nations. We will see if this group is successfull in its bid. However, it certainly seems like Snoop Dog has an interest in bringing diversity to the NHL which may not be a bad thing for the league.

Meanwhile, the Sparks group may be looking for additional funding to be able to fulfill their desired bid. The other bids submitted may have driven their intended price up.

NHLPA Looking at Potential Conflict of Interest Involving Kyle Dubas and Agent

The NHLPA is looking into a potential conflict of interest involving the Wasserman agency and its representation of both former Maple Leafs general manager Kyle Dubas and star Toronto forward Auston Matthews. Chris Armstrong of Wasserman represented Dubas in his negotiations with Toronto, but Armstrong is not a certified NHL agent. He mostly focuses on representing golfers. However, the NHLPA has fairly strict rules when it comes to prohibiting certified agents representing both players and team executives. The question here is if those rules apply when a non-hockey related arm of the agency represents an executive while the hockey group represents a player. Many people think the answer to that question is yes but it will be something for the NHLPA to look into.

In many circumstances such as law firms, the only way to represent two sides of a transaction or action is to have a very thorough set of protections and controls in the firm. This prevents one side getting information on the other. There are also situation where the clients give informed consent. You commonly see this in real estate transactions as well as estate planning. This might be a little different however since it is dealing with the NHLPA and agents. It is really the agency and not Matthews or Dubas that the NHLPA is looking at. The answer could impact how agencies operate going forward so is certainly something to keep an eye on.

The U.S. Congress is Likely to Propose Bills Related to NIL Rights and NCAA Rules on Pay for Athletes, Antitrust and Amateurism

Members of the United States Congress are looking to propose bills to address the relatively newly created Name, Image, Likeness (NIL) rights for college athletes as well as the general landscape of pay for play and amateurism in college sports. NIL is a somewhat complicated subject simply because it is a little like the will wild west at this point. Each state has their own laws and rules (or they have nothing). The NCAA does too. So there is not really a uniform set of standards at this point.

The bills are likely to be all over the place as far as favoring the NCAA or the players. Even though the bills are likely to fail, the attention these subjects are getting is noteworthy for college hockey players and those deciding whether to go the college route. So much of this can potentially affect NCAA eligibility rules for players.

Hearing Set on Proposed Claims Process for CHL Hazing Lawsuit

Ontario Superior Court Justice Paul Perell scheduled a hearing in Toronto on August 29, 2023 for the CHL and the representatives for the former players who filed a lawsuit against the CHL related to hazing and abuse to discuss a potential claims process. Following the filing of the lawsuit, Justice Perell rejected the plaintiffs’ attempt to certify the action as a class action lawsuit. Instead, he instructed the plaintiffs to proceed in a “individual issues protocol.”

This process involved notifying all former and current CHL players that they have a potential claim against their former teams and leagues if they were victims of abuse when they played major junior hockey. The liability to the CHL, member leagues and teams could still be very high even though it is not a class action lawsuit. Meanwhile, Justice Perell largely agreed that there seemed to be a significant, consistent culture of hazing and abuse in major junior hockey that needed to be addressed. The difference here is that each claim will be individualized to the person and team/league involved. This hearing should allow the sides to come up with a plan to handle the claims process.

Arizona Coyotes Tempe Vote Fails

Our featured story of the period for hockey’s business and legal updates involves the Arizona Coyotes and their future. On May 16, voters in the town of Tempe went to approve or disapprove three propositions to build a $2.3 billion, privately funded entertainment district that would include a new arena for the Coyotes. The Coyotes have been in a somewhat constant state of uncertainty for a while as they are currently sharing Mullet Arena with the Arizon State Sun Devils. That arena is built for college level capacity and not NHL. The approval of the Tempe plan would be instrumental in giving the Coyotes some assurances of stability.

Instead, the voters in Tempe responded with a resounding NO. Its interesting that voters said no even though it was privately funded. Once again, the Coyotes find themselves searching for potential answers.

Considering the Coyotes are in an active lawsuit against the town of Glendale where they previously played, that is not an option. Downtown Phoenix seems questionable as well. They left there to go to Glendale (although it was largely due to issues related to the specific arena). In any event, the Coyotes once again will be on the prowl to figure out answers to keep the team in Arizona. Otherwise, relocation is a very real possibility. Numerous cities mentioned include Houston, Salt Lake City and even Hartford. Gary Bettman has been adamant about keeping the Coyotes in Arizona throughout his tenure. Stay tuned to see what happens.

Post image attribution: By Jenn G, CC BY-SA 2.0 https://creativecommons.org/licenses/by-sa/2.0, via Wikimedia Commons

Alec Roberson

Alec Roberson grew up in coastal North Carolina, taking a somewhat unconventional path to hockey. With hockey being almost nonexistent in that area, Alec found his passion for the game following the success of the Carolina Hurricanes in 2001 and 2006 and later played club hockey in college. After going through law school and practicing for some time, he now continues his love for the game through writing. Find him on twitter @roberson_alec

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