Judge: Balsillie will be permitted to bid at Coyotes auction

One week after the NHL rejected him as a potential franchise owner, Jim Balsillie's dream of buying the Phoenix Coyotes and moving them to southern Ontario has been given new life.

U.S. Bankruptcy Court Judge Redfield T. Baum ruled Wednesday that all bids for the financially ailing Coyotes, those to keep the team in Arizona or to move it elsewhere, would be accepted for the Sept. 10 auction.

He specifically said the US$212.5-million offer from Balsillie, the Canadian billionaire who twice before tried to move an American team to Canada, would be considered. That sets up another showdown between Balsillie and the NHL, because the league's board of governors unanimously rejected him as an owner in a July 29 vote.

Balsillie's bid is contingent on moving the team to Hamilton.

Balsillie spokesman Bill Walker praised the judge's for creating a "fair and transparent" sales process.

"It's the best outcome for creditors and for the future of the franchise," Walker said. "We think Jim Balsillie's bid will emerge the winner because it offers the best financial terms and the best market in Hamilton, where hockey fans are thirsting for this team."

But Balsillie's bid still faces several major hurdles.

The NHL has made it clear it doesn't want Balsillie as an owner, and is looking for a bidder that would keep the team in the Phoenix suburb of Glendale, Ariz.

"We remain confident that the successful bidder will be one who is committed to continuing to operate the Coyotes in Glendale for the long term," NHL deputy commissioner Bill Daly said in a statement. "We also remain confident that Mr. Balsillie's bid for the team will never be approved by the court for a variety of reasons, including that his application for ownership was overwhelmingly rejected by the NHL board of governors last week.

"We look forward to making significant steps toward resolution of this unfortunate situation over the next several weeks".

The league also hasn't ruled on whether it would allow the team to move or what fees would be included to enter territory now claimed by the Toronto Maple Leafs and Buffalo Sabres.

Additionally, Baum has not ruled whether Balsillie can escape the lease the Coyotes have with the city of Glendale to play at Jobing.com Arena.

Baum scheduled a hearing next Tuesday to consider issues that have been raised by his ruling.

An auction had been set for Aug. 5 for potential buyers who would keep the team in Arizona.

But the NHL, Glendale and the two apparent local bidders asked for a postponement to Sept. 10. That raised the possibility of adding bids from buyers who would relocate the team.

Balsillie's bid is by far the biggest.

A group headed by Jerry Reinsdorf -- owner of baseball's Chicago White Sox and the NBA's Chicago Bulls -- has offered $148 million to buy the team and keep it in Glendale but is still working out details with the city and other creditors.

A third group known as Ice Edge, headed by Canadian and American investors, told the court it intends to submit a bid of about $150 million but was still gathering financing.

Earlier Wednesday, Baum delayed a hearing on whether to find the owner of the Coyotes and his lawyers in contempt of court for publicly filing documents that were supposed to be kept confidential.

Team owner Jerry Moyes opposes the Reinsdorf deal, which would give him little or no money. He supports Balsillie's proposal, which would give him about $100 million.

Lawyers for Moyes posted confidential documents to the public docket last week. The documents were later removed, but Glendale sought the contempt order on Monday, saying the city was "absolutely outraged" by the release of the information.

The Arizona Republic saw the appendix before it was removed.

It showed that Reinsdorf has asked for a special taxing district to be created near the arena that would pay the new owners as much as $23 million next year. And if the team was still losing money after five years, Glendale would have to pay Reinsdorf $15 million for each year of losses or allow the team to be sold and moved without penalty, according to the newspaper.

Glendale contends the release of confidential negotiations would discourage potential buyers from participating and have a "chilling effect" on the sale process.

Gary Bettman and John Daly are probably fuming right now... They know that nobody can match Jim Balsillie's offer and thus, a seventh team in Canada is thinkable

We will all have this saga ended on September 10, and I don't know why, Gary Bettman will trick this one so it stays in Phoenix. But if money is only the case, then Hamilton (or Winnipeg) will win it

It's a great news for Hamilton/Winnipeg.

I still don't understand why Bettman wants to keep the team in Phoenix. There is no hockey market there, keep the team there, and lose money.

Because Gary Bettman prefers it that way, period. Nothing else to say

If I look at the transferred teams, only Colorado has a market

Quebec was full, so does Colorado (for this one, I give him credit... even if the rivalry Quebec - Montreal was huge)
Harford was full, Carolina didn't care (less now, since they won the Cup)
Winnipeg was full, Phoenix doesn't care (their biggest fans, desert sand and cactus, aren't allowed in the arena)

Nashville doesn't get any fans at all, and I think Columbus is in the same boat. They don't have hockey fanbases over there. But Gary Bettman prefers hockey team in the unknown regions of the US instead of hockey supermarkets in Canada. Personally, Winnipeg is on top of any list regarding localization: this town has everything, and then some. And how much hockey fans they have...

Shadowjoe wrote:: Because Gary Bettman prefers it that way, period. Nothing else to say

If I look at the transferred teams, only Colorado has a market

Quebec was full, so does Colorado (for this one, I give him credit... even if the rivalry Quebec - Montreal was huge)
Harford was full, Carolina didn't care (less now, since they won the Cup)
Winnipeg was full, Phoenix doesn't care (their biggest fans, desert sand and cactus, aren't allowed in the arena)

Nashville doesn't get any fans at all, and I think Columbus is in the same boat. They don't have hockey fanbases over there. But Gary Bettman prefers hockey team in the unknown regions of the US instead of hockey supermarkets in Canada. Personally, Winnipeg is on top of any list regarding localization: this town has everything, and then some. And how much hockey fans they have...

I believe that the fanbase for Columbus is growing and growing.. and the market is developping.

i also heard that columbus was a great hockey town

All this saga will be underway online in a couple of minutes at http://www.tsn.ca/nhl/story/?id=289668
Will that end it for good or not?

2:13 Kessler said the NHL is a competing bidder and now they are denying the creditors. They know the team can't stay in Glendale, they just don't want it in Hamilton. They forfeit the right to argue deference now that they are a bidder.

2:16 According to Kessler, sports leagues do not need owners to love each other.

2:18 Judge Baum understands that no one has found a case that establishes a precedent, but he wonders about other areas, like when a partnership is asked to admit someone they don't want to admit.

2:20 Kessler responded by saying that someone needs to make this determination and points out Balsillie has already been approved once. The NHL can't just say they don't like him. They have a duty to the debtor, in this case Moyes.

2:39 After a 10-minute break, court is back in session.

2:40 Relocation for this year will be the next issue argued today. They will not get through all the issues today, but the main issues (overturn the vote and relocation) should be.

2:48 Judge Baum has asked Balsillie to reconsider his September 14th deadline.

2:53 Susan Freeman argued that there have been cases when a parter has been forced upon a partnership, such as real estate or car dealerships.

2:56 Freeman suggests putting Balsillie on the stand, but Judge Baum declines saying that if he were to have Balsillie take the stand, he would then have to interview everyone involved.

2:59 Judge Baum stated that he is reluctant to discourage anyone from making a bid. He went to say that everyone better have a very compelling argument for why a bidder should not bid. He is concerned about losing a bid (any bid).

3:04 Judge Baum wants to do everything he can to keep all of the bidders at the table. He will not allow Freeman's argument that the league shouldnt have deference today.

3:11 Again Freeman asks Judge to examine Balsillie and Bettman for testimony.

3:46 NHL's Fienstein sites a number of consent cases where ownership transfer was turned down (Burger King, Sizzler, Ford dealership, etc.).

3:50 The NHL does not want an evidenciary hearing. Leopold, Jacobs, amongst others aren't present. This is not consistent with what they believe was agreed earlier.

3:54 Judge Baum wonders if he can assess this case fairly based on depositions. He mentioned a lack of consitency in all the written testimony and now wants the complete transcripts to put things in proper context.

3:55 There is now a break until 4:40pm et/1:40pm pt with relocation arguments coming after the break. The session is scheduled to finish at 7:30pm et/4:30pm pt.

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