PHOENIX — The National Hockey League is planning a showdown in court over the Phoenix Coyotes filing for Chapter 11 bankruptcy protection and the proposed sale of the team to BlackBerry boss Jim Balsillie.
League spokesman Frank Brown said lawyers for the NHL would appear in federal bankruptcy court in Phoenix on Thursday.
He would not say what action the league would take, but commissioner Gary Bettman said Wednesday that whether Coyotes owner Jerry Moyes had the authority to file for bankruptcy “is something we’re going to look into.”
Moyes’ lawyer Thomas Salerno said any challenge by the NHL would have no merit.
“They are mistaken,” Salerno told The Associated Press.
Balsillie, co-CEO of BlackBerry maker Research In Motion, said his US$212.5-million offer is contingent on moving the team to southern Ontario.
The NHL says it removed Moyes from all positions of authority with the team after the league was caught by surprise by the bankruptcy filing on Tuesday.
Bettman wants to keep the team in Arizona.
“This is more about the tactic and I think a challenge to league rules than it is about economic condition of the club, which we believe can with new ownership and with the accommodations the city of Glendale is prepared to make, we think can succeed,” Bettman said.
The team plays at Jobing.com Arena, a state-of-the-art facility that opened in December 2003 in the west Phoenix suburb of Glendale.
Glendale city manager Ed Beasley told the AP that an offer to buy the team and keep it in Arizona will be made soon. Beasley said a group that includes Jerry Reinsdorf, owner of Chicago White Sox and Bulls, is working with the NHL on a proposal.
“I will say we are very confident that an offer will be made,” Beasley said.
Salerno said Moyes would welcome another bid, but the top offer would get the team.
“Our job is to maximize the value of the asset,” Salerno said. “We will sell this team to the highest and best bid.”
Moyes has lost more than $200 million in equity and more than $100 million in debt with the Coyotes, Salerno said, although some of debt will be paid as part of the bankruptcy settlement. Moyes is owner of Phoenix-based Swift Transportation, a trucking company that has suffered in the bad economy.
This is Balsillie’s third attempt to buy a team and move it to Canada. Previous efforts in Pittsburgh and Nashville fell apart over his insistence that the team be moved.
Balsillie established a website, www.makeitseven.ca, to solicit support for the Coyotes move from Canadian hockey fans.
“We want those Canadian voices who want a seventh NHL team in Canada to be heard throughout the North American NHL market,” Balsillie said in a news release.
One such Canadian voice is Ontario Premier Dalton McGuinty, who says he’d love to see another NHL club in the province.
But he says he won’t get involved to help Balsillie’s bid and isn’t looking to free up taxpayer dollars to help move the team.
The Coyotes have struggled, on the ice and especially at the bank, since the franchise moved from Winnipeg in 1996. The team never has made it past the first round of the playoffs since coming to Arizona and has not advanced to the post-season since 2002.
Meanwhile, crowds have dwindled and debts have mounted.
The franchise nearly moved to Portland, Ore., before Wayne Gretzky stepped in as managing partner in 2001 when developer Steve Ellman and Moyes bought the team for $90 million. Gretzky has coached the team for four seasons, failing to make the playoffs each year. He owns 1.5 per cent of the team, according to bankruptcy documents. Gretzky has not been available for comment.