Sunday, June 14, 2009

Tick, Tick, Tick

The earliest we will be hearing from Judge Tom is Monday June 15th. If he were to rule in favor of the Moyes-Balsillie arguments in the Coyotes bankruptcy hearing, the team would be auctioned off on Monday June 22nd.

Of course, that assumes nothing gets in the way of the bankruptcy decision and the auction. And "nothing" is not a likely outcome.

If Judge Tom (and we now have confirmed that's what he likes to be called) drops a Baumshell says the auction is on, then there will likely be two immediate appeals (the NHL and The City of Glendale) and the possibility of additional flanker lawsuits from involved parties like ARAMARK. In the cases of the NHL and Glendale, appeals to the 9th District Court of Appeals will almost surely ask for injunctions against the auction based on all of the the legal issues that have been catalogued here and elsewhere.

Which puts this entire debate squarely on the clock. The auction is scheduled in 7 days. The NHL draft is in 12 days. Free agency opens 5 days after the draft. And the NHL schedule is traditionally announced right after the 4th of July. (It is in fact completed) And Judge Tom is leaving on vacation a week from Tuesday.


Well, I think that the good Judge has clearly helped the short term hand of the NHL by delaying the decision until at least Monday. He knows there will be appeals and injunctions. He knows that getting all issues cleared so that there can be an auction in 7 days is highly unlikely. And he knows that the Balsillie bid could expire, although no one really expects him to stop chasing the team. He also knows that the NHL has offered to fund the team until a September auction can be held.

And for all we know, he may have decided that the thought of having an auction on June 22nd simply isn't going to work.

Some Canadian reporters have speculated that the judge may be making time for the two sides to reach a negotiated settlement. That's highly unlikely. If there were talks underway, it would have been leaked to the Canadian press by now. And any negotiation that would move the team would still be subject to the full wrath of Glendale and their lawyers. No one is going to work a deal with them.

And he also knows that there are antitrust implications. The league would likely vote quickly to deny the franchise transfer. That would only set off more court battles and a less swift recovery for the creditors.

The logical explanation is that The Judge has decided to delay the auction to September. The Judge knows that the asset is not going to lose value. And he also knows the NHL will fund the team until a new owner is found. Whether or not he sides with Moyes/Balsillie or the NHL, he also knows that any decision to conduct the auction next Monday will be appealed and likely delayed by injunction.

Of course, any time a lay man (or in this case, a blogger) decides to interpret the law and predict what judges are going to do, it comes with no guarantee.

So for now, we wait. I would much rather be writing about the very interesting draft, free agent and trade market that will open later this week. Hopefully we can get on to that by the middle of the week.

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