Bankruptcy Judge rejects Sale and Move of Coyotes

PHOENIX (AP) - The Coyotes are staying in Phoenix.
A bankruptcy judge has rejected the proposed sale of the team to
Canadian billionaire Jim Balsillie, who would have moved the team
to Hamilton, Ontario.
Judge Redfield T. Baum issued a 21-page ruling late Monday
afternoon, concluding that the June 29 deadline imposed by
Balsillie did not allow enough time to resolve the complex case.
"Simply put, the court does not think there is sufficient time
(14 days) for all of these issues to be fairly presented to the
court given that deadline," the judge wrote.
The ruling is a victory for the NHL, which had argued Balsillie
was using the U.S. Bankruptcy Court to make an end-run around the
league's rules over who owns teams and where they are located.
NHL deputy commissioner Bill Daly declined immediate comment
Monday, saying the league needed to read the entire opinion before
issuing a statement.
The judge's decision is also a win for the city of Glendale,
which had spent $183 million to build an arena for the Coyotes and
had contended the franchise could not use bankruptcy to evade its
lease.
This is the third time Balsillie - whose company makes the
Blackberry - has tried and failed to buy an NHL team. His previous
attempts to purchase the Pittsburgh Penguins and Nashville
Predators fell through.
Coyotes owner Jerry Moyes took the NHL by surprise when he filed
for Chapter 11 bankruptcy on May 5, proposing to sell the team to
Balsillie for $212.5 million, contingent on the franchise moving to
Hamilton, Ontario.
The NHL said that commissioner Gary Bettman was in a car on his
way to deliver a letter of intent to Moyes from Jerry Reinsdorf to
purchase the team and keep it in Glendale. However, any bid to buy
the team in Arizona will be far less than the offer Balsillie made.
"I think people are going to be shocked when they see the value
of this team remaining in Glendale," Moyes' attorney Thomas
Salerno said. "It's going to be materially less than the offer we
have on the table."
Salerno said Moyes is disappointed and is evaluating his
options. Moyes says he has more than $300 million invested in the
team and would have recouped about $100 million if the Balsillie
sale had gone through.
The NHL says it has had four parties, including Reinsdorf, file
preliminary applications to investigate purchasing the team and
keeping it in Arizona. However, if no buyer can be found, the
league would look to relocate the franchise.
Moyes and Balsillie had contended that the team would never
succeed in Arizona and would flourish in hockey-crazy Ontario. But
the move raised territorial rights issues because of the proximity
of the Toronto Maple Leafs and Buffalo Sabres.
Baum had raised the specter of a fee due to the NHL and the
teams if the franchise moved.
Moyes had wanted the court to auction off the team on June 22,
but the ruling vacated that hearing. The NHL says it wants to have
a new owner for the team by September. The league has said it will
fund the team for the coming season, if necessary.
The Coyotes have lost more than $300 million since the franchise
moved from Winnipeg, Manitoba, in 2006, but the NHL contends the
franchise can be viable with better management and more success on
the ice.
The Buffalo Sabres and managing partner Larry Quinn had no comment Monday Night on the ruling. We'll have the latest tonight on Eyewitness News at 11pm.