The Travesty that is the NBA MVP Award

[Yankees]

Ah, come on Brett, you can come up with something better than that? Did Stern email that out to all you employees and tell you that was the canned response to you were suppose to give anytime someone in the press asked you about the Seattle situation?

I'm going to state this again for the record - I don't work for the NBA anymore. So no, that was a Zalaski original.

Trust me, I get it. I wanted to believe the Whalers would stay in Hartford - no dice.

What Stern "might" have done wrong, will come out in the court case. Stern was the guy who introduced Bennett to Howard Schultz and helped orchestrate the sale from behind the scenes. It has been shown that Clay Bennett's ownership group didnt have any intention of honoring parts of the sales agreement. It will be interesting to see if there is other evidence that the City already has that ties David Stern to the Oklahoma groups early conspiring.

I don't want to tip your imaginary thoughts that ownership proposals come together out of thin air - but rich people tell David Stern and everyone else at the NBA they want to own a team. David Stern then points them in the direction of a team they know is selling.

It hasn't been "shown" that Bennett ever acted in poor faith - that's what you're not getting, and that's what's impossible to prove. His co-owners can say whatever the fuck they want to say - the only person the city can sue is the majority owner - and unless there's evidence yet to be produced, or there's the Jack moment I mentioned before, there's no case but hoping and wishing.

[Tigers]

It hasn't been "shown" that Bennett ever acted in poor faith - that's what you're not getting, and that's what's impossible to prove. His co-owners can say whatever the fuck they want to say - the only person the city can sue is the majority owner - and unless there's evidence yet to be produced, or there's the Jack moment I mentioned before, there's no case but hoping and wishing.

I think you are confusing the two different lawsuits that are taking place Brett. The City's is lawsuit doesn't have anything to do with a "good fait best efforts" sale clause or anything like that. The City of Seattle's suit is mearly to uphold the "Performance Clause" in their lease that requires the Sonics to play their home games in Key Arena. That is all. It is a very simple case and there is historical legal precedence that supports the City's side.

Lawsuit #1 is pretty simple. City will most likely win unless something way out of left field comes out an Clay Bennett and the Sonics will be fored to stay in Seattle for the next two seasons.

Lawsuit #2 is where is gets really murkey and where the legal experience of Schultz's attorney is going to come into play and possibly lack there of, from Bennett's legal side. You really should go read that legal brief if those kinds of legal currousings entertain you. Schultz isn't suing for lack of a "good faith best efforts" by Bennett after the purchase and he's not suing to take back personal ownership of the team.

[Tigers]

I wouldn't give Lawsuit #2 more than a 30% chance of winning (legal minds have actually given him a better shot at success) however I think what it could do is drag Bennett down far enough and drag the issue out long enough that Bennett finally does decide its not in his best interest to continue.

Anyways, the legal manuevering is already and going to continue to be very entertaining.

[Giants]

I actually am kind of interested in the legal briefs in the Schultz case, are they available online?

[Tigers]

I actually am kind of interested in the legal briefs in the Schultz case, are they available online?

They are......will take a sec for me to track them down.....

[Yankees]

Right, sorry, my miswording.

I'm saying barring a natural disaster of evidence that has yet to come out the team's leaving Seattle.

If you're giving them a 30% chance of winning that lawsuit, that's the only chance they're staying. Bennett's has said over and over again he's not going to give up - and unless they have a yet produced email or voice mail of him saying he bought this team with the sole intention of moving it to Seattle then they aren't winning.

Lawsuit #1 just keeps them around for 2 more years - which I'm sure will be a blast for everyone.

[Yankees]

You can try to play all the word games you want on this one - the reality is the team's, at worst, 75% out the door.

[Giants]

"I am a man possessed! Will do everything we can. Thanks for hanging with me boys, the game is getting started!"

This is the jarring quote to me, its hard to argue good faith negotiations when you admit to playing games. That quote is more of a smoking gun to me than the sweet flip thing, the problem for Bennett is that by acknowledging the desirability of a sweet flip it seems he strengthens the case for just selling the team to Ballmer.

[Tigers]

I actually am kind of interested in the legal briefs in the Schultz case, are they available online?

Here is the Schultz legal brief.

http://seattletimes.nwsource.com/ABPub/ ... 366926.pdf


....and a somewhat interesting take from an unbiased third part Chicago lawyer/journalist.

http://sports.espn.go.com/nba/columns/story?id=3362659


Will be interesting to see if the City's case reveals any additional incriminating evidence against Bennett and his ownership group that can then be used in the Schultz case.

[Giants]

I just found the brief (thank you Google). I'm not well versed in Washington state law and their definition of good faith negotiation, but I know that California law has something called "the reasonable person standard," basically if a reasonable person were to way the evidence about whether or not Clay Bennett, Aubrey McClendon, and the gang had any good faith desire to keep the team in Seattle any reasonable person would have to say no based on the content of the emails and the statements of Mr. McClendon, who because he is a part of the ownership group is suable, it isn't just the principal owner who is responsible for the good faith deal if I remember my limited liability company rules correctly. More importantly, whether fans care or not, it doesn't seem like there's any doubt about who's doing the wrong thing.

Z, your absolutely right that Stern is the owner's man, and good for him for sticking to that (in Ancient Rome, for instance, it wasn't bad to be bought by a special interest, as long as you stayed bought). The problem is that the role of the commissioner should be about the interests of the game, not the interests of the owners. It's not really in the interest of the NBA to put a team in Oklahoma City, it's a nothing market, and not only does it not create any new logical rivalries, it destroys one with some history (Portland vs. Seattle), which is prepared to grow in marketability based on Oden vs. Durant starting next year. The other 29 owners are going to fall in line with each other by and large, but moving this team to Oklahoma City is bad for the league.

[Tigers]

"I am a man possessed! Will do everything we can. Thanks for hanging with me boys, the game is getting started!"

This is the jarring quote to me, its hard to argue good faith negotiations when you admit to playing games. That quote is more of a smoking gun to me than the sweet flip thing, the problem for Bennett is that by acknowledging the desirability of a sweet flip it seems he strengthens the case for just selling the team to Ballmer.

A funny side note of that first part. Clay Bennett was asked in public by a reporter after the BOG vote what he meant by the "I'm a man posssed" part. His reply was that he felt bad that his email was "mis-interpreted" and that the email meant' He was a man possessed to keep the team in Seattle".

I don't think that is going to fly in front of a judge when he's on the witness stand.

[Yankees]

Sorry Jake, it's owners first, game 2nd. The owners, as a group, have the power to fire Stern.

This is the rare case where what's in the best interest of the owners and the best interest of the game diverge - and you can see where Stern's responsibility lies first and foremost.

had any good faith desire to keep the team in Seattle any reasonable person would have to say no based on the content of the emails and the statements of Mr. McClendon, who because he is a part of the ownership group is suable, it isn't just the principal owner who is responsible for the good faith deal if I remember my limited liability company rules correctly.

Unfortunately you're forgetting that Bennett (regardless of how half-assed you think his attempt was) tried to get the finances on a new stadium. It may have been a shitty proposal but the evidence supports:
1) That an NBA team can not be profitable in Key Arena as is
2) Bennett tried to get a new stadium for the team

If he wanted to sell once the stadium was approved is an entirely seperate matter - and that's all the evidence appears to support. If the city had approved the stadium then the team would have stayed in Seattle and Bennett would have then tried for a team in OKC. As fucking crummy as it and he is, it's going to be hard to go against that.

[Giants]

Schultz's lawyer will argue that the attempt that was made to finance the arena was untenable, that the ownership group was unwilling to consider all options, and that they knew full well that the proposal they made would be rejected. That is the very definition of bad faith negotiation.

[Giants]

\s is
2) Bennett tried to get a new stadium for the team

If he wanted to sell once the stadium was approved is an entirely seperate matter - and that's all the evidence appears to support. If the city had approved the stadium then the team would have stayed in Seattle and Bennett would have then tried for a team in OKC. As fucking crummy as it and he is, it's going to be hard to go against that.

And come on dude, you fucking work in basketball. You play basketball in an ARENA.

[Yankees]

Yea - I'm writing this as I'm simultaneously filling out a league ticket sales report and making cold calls to Erie chiropractors. My bad...

Schultz's lawyer will argue that the attempt that was made to finance the arena was untenable, that the ownership group was unwilling to consider all options, and that they knew full well that the proposal they made would be rejected. That is the very definition of bad faith negotiation.

They will - but they aren't going to win.

[Tigers]

Unfortunately you're forgetting that Bennett (regardless of how half-assed you think his attempt was) tried to get the finances on a new stadium. It may have been a shitty proposal but the evidence supports:
1) That an NBA team can not be profitable in Key Arena as is
2) Bennett tried to get a new stadium for the team

You keep saying this, but I'm not sure all the evidence is there to support you. Especially when as early as the 2006 season the Sonics generated an operating profit.

http://www.forbes.com/lists/2006/32/biz ... _Rank.html

And the only thing that profitability will play into is the Sonics trying to get out of the remaining two years of their lease by claiming economic hardship, which they are failing miserably at right now. Poor management and expected operating losses are not a viable legal reason to break a lease.

The Schultz lawsuit will hinge on his ability to prove the Oklahoma Ownership group fraudulently deceived Schultz into selling to them. Usually, extremely hard to prove, as the Chicago lawyer notes, however in most cases the plaintiff doesn't have the email evidence that has already been revealed reflecting the Oklahoman's real intentions and may even have more evidence that they haven't revealed to the public yet.

Like I said, its going to be a very entertaing legal dance that goes on.

[Yankees]

The operating cost of running a team gets solidly higher every year. Unless the Sonics have the greatest CFO in the history of the world, they can't turn a profit. Once the documents become public evidence in the trial (two of my best friends at the NBA worked on them), you'll see that it's impossible.

In talking to my friends at the NBA, the problem with the Forbes valuations that you just showed (just called them) is that for each team, regardless of if they own their stadium, they take in ticket sales, suite, concession, merchandise, and sponsorship profits. Unfortunately the Sonics, as a team, lose money because their lease sucks so bad they get a sad amount of the above, while incurring the bulk of the cost to run and operate a team.

"Earnings" is just the amount of money that's made off the team above or below the cost of every piece of income having to do with the team. Thus the reason the Knicks can incur such a massive debt, yet still be the most valued team on that list (Knicks get money from Liberty, concerts, etc.), and the Sonics can "turn a profit" but have no value (they don't get to keep shit).

[Tigers]

The operating cost of running a team gets solidly higher every year. Unless the Sonics have the greatest CFO in the history of the world, they can't turn a profit. Once the documents become public evidence in the trial (two of my best friends at the NBA worked on them), you'll see that it's impossible.

In talking to my friends at the NBA, the problem with the Forbes valuations that you just showed (just called them) is that for each team, regardless of if they own their stadium, they take in ticket sales, suite, concession, merchandise, and sponsorship profits. Unfortunately the Sonics, as a team, lose money because their lease sucks so bad they get a sad amount of the above, while incurring the bulk of the cost to run and operate a team.

"Earnings" is just the amount of money that's made off the team above or below the cost of every piece of income having to do with the team. Thus the reason the Knicks can incur such a massive debt, yet still be the most valued team on that list (Knicks get money from Liberty, concerts, etc.), and the Sonics can "turn a profit" but have no value (they don't get to keep shit).

I definately feel like I'm talking to a "sales man" and not a finance guy.

That figure listed by Forbes is the financial definition of "EBITDA" and represents "Cash Flow" for the business. The includes all payouts to the City of Seattle for rent, suite revenue sharing and the likes. Yes, it represents the Basketball operations of the Sonics. So, based just on the basketball side of the operations the Sonics did and can operate under the current lease without losing cash out the door.

Now out of that figure, the Sonics would still need to pay, debt service if they had to leverage themselve up in order to buy the team and taxes if applicable. In addition, below the EBITDA figure you'd see "other revenue" which is noted below.

Now what you are quoting your friends at the NBA office as talking about, is all the "OTHER" revenue streams generated by the Arena (concerts, trade shows, etc.) You know, events that the basketball team has no involvement in, but want's to skim revenue from becase it takes place in the building they didn't put any money into in the first place.

Now because the NBA doesn't want the public to see how much money they are making on "other revenue" events, they don't let the public see their audited financial information and only reveal edited information like what is listed by Forbes in relations to "pure" basketball operations".

Now I agree, if the NBA ownerhips puts a substantial amount of money into the actual facilty, then they should have access to a portion of the "Other Revenues" that are generated by the facility, however the problem lies in the NBA teams wanting cities to fund 100% of their facility and then the NBA teams feeling they have "a right" to stick their fingers in the "Other revenue" pool in order to fund their "rapidly rising" costs (see player payroll) and then cries foul when the City that funded the Arena doesn't just roll over and give them all the "other revenues". Yes, I know it is a tough world for those NBA teams to live in.

Does the Key Arena need to be upgraded? Yes. Should the City of Seattle fund 100% of the upgrade and then give all of the "other Revenues" the facility generates to the NBA Franchise who didn't want to put any of its own money into the facility? Absolutely not. That would be the equivalent of renter #1 in the Penthouse Suite of a high rise apparent complex demanding the owner of the building give him a share of the "other renters" monthly payments without every actually putting any of the project outside of paying his monthly rent on the penthouse.


So to answer the question, Did the Sonic's basketball operations make money recently? Yes, they did.

To the question, does Key Arena generate enough additional revenue outside of the core basketball operations that the Sonics can try and take from the City in order to make their overall value worth more? Well, the current lease doesn't allow them to take the money they didn't/don't have a vested interest in and in order for them to get access to it, the Key Arena needs to be upgraded so it can generate more "other revenues" and the team actually needs to invest some of their own money in the upgrade of the facility so they have a "logical" reason to access those "other revenues".

[Yankees]

That would be the equivalent of renter #1 in the Penthouse Suite of a high rise apparent complex demanding the owner of the building give him a share of the "other renters" monthly payments without every actually putting any of the project outside of paying his monthly rent on the penthouse.

I'm sorry - this is a dumb statement. The ONLY way that this is similar is if Justin Timberlake rented the penthouse apartment and then the owner told everyone "you should live here because Justin Timberlake lives here!"

Having a pro sports team in an arena allows the arena to make more money on everything else - it becomes a more valuable place for entertainers, tours, other sports, etc. to play. So instead of getting Gordon Lightfoot, you get Justin Timberlake. This really shouldn't be that hard to understand.

So, based just on the basketball side of the operations the Sonics did and can operate under the current lease without losing cash out the door.

You can try to talk yourself into this as much as possible, but it's just not true today. There is a rising cost to EVERYTHING in basketball, and the Key Arena can not, as constructed, keep up with these risings costs and expect the team to turn a profit.

Can an NBA team in Seattle turn a profit? Yes it can, and I'm sure it has in the past. Can an NBA team in Seattle turn a profit next year, even if they get sold to Superman and have a great season? No they can not. So long as the evidence gets released to the public, you'll get to see it just isn't possible.

And just to show I can play word games too:
Basketball operations is the scouting, taking care of the players, player transactions, etc.

Business operations is the side that brings in the revenue.

[Tigers]

Having a pro sports team in an arena allows the arena to make more money on everything else - it becomes a more valuable place for entertainers, tours, other sports, etc. to play. So instead of getting Gordon Lightfoot, you get Justin Timberlake. This really shouldn't be that hard to understand.

Brett, if that isn't the biggest steaming pile of markting bullshit I've ever heard. U2 came to Seattle and played at Key Arena. U2 didn't play at Key Arena because it is where the Sonics play, they played there because it was the best available venue in Seattle for their concert. If the Sonics leave and U2 comes back to Seattle they will play in Key Arena whether or not the Sonics are still here or not.

Tim McGraw is playing at the Ford Center in Oklahoma City. You think he's playing that venue because Oklahoma City has an NBA team right now? They don't, he's playing there because its the best venue for his concert. So, based on your theory, who would be playing at the Ford Center if they had an NBA team? Celine Dion? Isn't she one of the biggest draws in the world these days?

The NBA team doesn't draw bigger shows to an arena that normallly wouldn't play in the same arena if an NBA team wasn't playing there otherwise. An NBA team is typically the anchor tenant of an arena that may create the lions share of revenue for the facility DURING basketball games, but the NBA team playing there has no bearing what so ever on what kind of "other events" book the venue in the off times.

[Tigers]

And just to show I can play word games too:
Basketball operations is the scouting, taking care of the players, player transactions, etc.

Business operations is the side that brings in the revenue.

So are you now claiming that the Forbes revenue figures are only from basketball operations (ticket/suite sales) and don't included TV revenues, advertising, concessions, etc?

If that is what you are now claiming with your "word games", you'd be flat out wrong. The Forbes revenue figure includes ticket revenues, suite revenues, national broadcast revenues, local broadcast and sponsor revenues, merchandise sales, concession sales. The items not included in the Forbes revenue figures are luxury tax revenues paid to teams and NBA league-wide revenue sharing being paid to teams.

[Royals]

Having a pro sports team in an arena allows the arena to make more money on everything else - it becomes a more valuable place for entertainers, tours, other sports, etc. to play. So instead of getting Gordon Lightfoot, you get Justin Timberlake. This really shouldn't be that hard to understand.

Brett, if that isn't the biggest steaming pile of markting bullshit I've ever heard. U2 came to Seattle and played at Key Arena. U2 didn't play at Key Arena because it is where the Sonics play, they played there because it was the best available venue in Seattle for their concert. If the Sonics leave and U2 comes back to Seattle they will play in Key Arena whether or not the Sonics are still here or not.

Tim McGraw is playing at the Ford Center in Oklahoma City. You think he's playing that venue because Oklahoma City has an NBA team right now? They don't, he's playing there because its the best venue for his concert. So, based on your theory, who would be playing at the Ford Center if they had an NBA team? Celine Dion? Isn't she one of the biggest draws in the world these days?

The NBA team doesn't draw bigger shows to an arena that normallly wouldn't play in the same arena if an NBA team wasn't playing there otherwise. An NBA team is typically the anchor tenant of an arena that may create the lions share of revenue for the facility DURING basketball games, but the NBA team playing there has no bearing what so ever on what kind of "other events" book the venue in the off times.

Seconded. Performers are going to go where the best conditions for them to meet their goals are, whether that's quality of performance or maximum possible revenue. Are there going to be a few exceptions? Sure. Everyone wants to play Madison Square Garden because it's Madison Square Garden. If the Knicks left MSG, it would STILL be a hot ticket for performances though. Do you think the pope went to Yankee stadium because he's a big pinstripes fan? Or is it because that was the place best suited to his needs?

[Cardinals]

Having a pro sports team in an arena allows the arena to make more money on everything else - it becomes a more valuable place for entertainers, tours, other sports, etc. to play. So instead of getting Gordon Lightfoot, you get Justin Timberlake. This really shouldn't be that hard to understand.

Brett, if that isn't the biggest steaming pile of markting bullshit I've ever heard. U2 came to Seattle and played at Key Arena. U2 didn't play at Key Arena because it is where the Sonics play, they played there because it was the best available venue in Seattle for their concert. If the Sonics leave and U2 comes back to Seattle they will play in Key Arena whether or not the Sonics are still here or not.

Tim McGraw is playing at the Ford Center in Oklahoma City. You think he's playing that venue because Oklahoma City has an NBA team right now? They don't, he's playing there because its the best venue for his concert. So, based on your theory, who would be playing at the Ford Center if they had an NBA team? Celine Dion? Isn't she one of the biggest draws in the world these days?

The NBA team doesn't draw bigger shows to an arena that normallly wouldn't play in the same arena if an NBA team wasn't playing there otherwise. An NBA team is typically the anchor tenant of an arena that may create the lions share of revenue for the facility DURING basketball games, but the NBA team playing there has no bearing what so ever on what kind of "other events" book the venue in the off times.

I am going to have to agree with Brennan here. Sure, it helps if the quality of the arena is better for hot performances. It'll be an easier sell to the artist. But it will not even come close to making or breaking if they tour that arena. If the artist has enough support and the city is big enough, the artist will tour there regardless of an NBA or NHL team. Obviously Brennan brought up U2 so that'll almost always get me to chime in, but let's use this for example continuing that idea.

2005 Vertigo tour, which sold out every show, played in Seattle with a dumpy arena, and yes, there was an NBA team there at the time. They played there because it's a large city and they have a pretty good fanbase in the Pacific Northwest.

Did they play the Fed Ex forum, which was only one year old, in Memphis? No. Why? Not particularly sure, the venue was not even a year old at the time of the start of the tour and barely a year old by the time it wrapped up, but the Bible belt fanbase probably isn't as rabid for U2. Also, it depends on the proximity of shows in other cities.

U2 also played in Hartford in 2005. There is no NHL team. There is no NBA team. It's probably one of the worst arena's in the country. They played it despite playing 17 shows between Boston, NJ and NYC.

If the artist thinks they will sell the tickets for that city they will play it despite the arena's condition. It has little to do with the arena itself.

The only possible theory I would buy that the arena would make a key decision is if it were a dual between arenas in close cities. I.e., band will either play at a newer arena within a fair proximity of an older arena and have to choose one. But I'm sure the newness of either arena will factor in to the decision ultimately- it will be where the most money is to be made. Whether that's the new arena because of a higher capacity of an older arena because they won't have to pay as much to rent it out, I'm not quite sure.

[Royals]

Remind us, how many shows did you see on that Vertigo tour?

[Cardinals]

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