AJC: Belkin must pay $2M by Thursday or he risks losing stake

[mrhonline]

http://www.ajc.com/sports/atlanta-thrashers/hawks-thrashers-co-owner-314924.html

To stay in the group as a minority owner, Belkin is required to pay his partners $25.8 million, according to court documents. That represents his 30 percent share of so-called capital or cash calls made during litigation. Belkin filed his notice to appeal the judge's decision last fall. At the time, he also asked the judge to stay his decision pending the appeal.

The judge earlier this month asked Belkin to put up $2 million, which he must do by Feb. 25. This basically buys Belkin time; no action can be taken on the judge's order if Belkin pays the money.

Also, this sucky bit at the end:

A decision isn't likely to come before the end of the year, Estep said.

[niremetal]

Also, this sucky bit at the end:

I know no one will believe this (haven't for 4 years, at least): But what happens in court has no effect on basketball (or, I presume, hockey) operations. The operating agreements that all owners have to sign with the NBA (and, I presume, the NHL) basically ensure that the assets and liabilities of each team are completely shielded from exposure to the effects of litigation involving the owners as individuals. The leagues HAVE to make sure the teams' assets and operating revenues are shielded, or else you'd see a half dozen major pro sports teams per decade become defunct because their owners went bankrupt. The overwhelming majority of revenues (and losses) stay with the team and the NBA, not the owners - the owners basically gain or lose money only upon selling their stake in the team. In that sense, you can think of owning a stake in an NBA team as somewhat like stock ownership - the ups and downs of the company don't show up on your tax return unless you realize gains or losses (or earn a dividend, which are pretty stingy in the NBA because most teams lose money, so virtually all revenues have to be reinvested into the league).

When the idiot judge in Maryland tried to order a freeze on the Hawks signing new players and initially ruled that Belkin could buy out the Hawks for a box of Cheerios, that was the only time that the basketball operations was affected. It lasted all of 2 weeks, because Stern stepped in, wrote the judge, and basically made her realize that what she ordered was at odds with the owners' agreements with the NBA (not to mention common sense). Other than that, the court stuff might be distracting, but it doesn't affect the team's financial constraints. David Stern would have been demanding that the team be sold if that were the case, because the NBA is second only to the NFL in terms of how short a leash the owners are on.

The reason ASG doesn't spend more is the same as for all other teams in their position: The Hawks don't sell enough tickets or draw big enough TV crowds. That certainly DOES affect how much a team can spend, though not to the same degree as it does in the NHL and MLB because the NBA has a larger pot of shared league revenues. The Hawks have never been a big draw, and they've never had a loyal TV following. Thus, they don't earn as much money as some other teams. Thus, they don't spend as much. Ta-da.

Edited February 19, 2010 by niremetal

[AHF]

The group had its share of disagreements from the start. Their sparring became more high profile, however, over a trade with the Phoenix Suns for guard Joe Johnson, who has since become a four-time All-Star.

The ASG has said (in different words) the disagreements from the start were over Belkin wanting to run the team on the cheap.

Has Belkin ever given his version of what the pre-JJ disagreement were over?

Edited February 20, 2010 by AHF

[niremetal]

The ASG has said (in different words) the disagreements from the start were over Belkin wanting to run the team on the cheap.

Has Belkin ever given his version of what the pre-JJ disagreement were over?

Yeah, he did in court last year. I was living in DC at the time, and actually went to 3 days of the trial. There were lots of little disputes early on, mostly really petty stuff like use of luxury box suites and who got the team's complementary tix on the road. It got worse, with Belkin telling Stern at one point that he thought one of the other owners (Peskowitz, I think) might be engaging in tampering, and suggesting that the NBA investigate (they disagreed over whether it was an "accusation" or just Belkin acting as a concerned owner looking out for the Hawks' interests).

The non-Belkin owners all knew each other beforehand, but I think only one of them (Levenson, I think) knew Belkin. Oil and water doesn't even begin to describe it. These guys all wanted to own an NBA team, but that was the only thing they had in common, it seems. The original ownership group was thrown together very hastily, and Belkin had it in his mind that he was the "managing partner" in the same way that Mark Cuban is, even though he only put up 20-something percent of the capital. The other owners thought it would be more consensus-based. Something had to give.

Edited February 20, 2010 by niremetal

[lethalweapon3]

Just envisioning ol' boy Belkin wearing the hell out of an ATM machine...

~lw3

[mrhonline]

I know no one will believe this (haven't for 4 years, at least): But what happens in court has no effect on basketball (or, I presume, hockey) operations. The operating agreements that all owners have to sign with the NBA (and, I presume, the NHL) basically ensure that the assets and liabilities of each team are completely shielded from exposure to the effects of litigation involving the owners as individuals. The leagues HAVE to make sure the teams' assets and operating revenues are shielded, or else you'd see a half dozen major pro sports teams per decade become defunct because their owners went bankrupt. The overwhelming majority of revenues (and losses) stay with the team and the NBA, not the owners - the owners basically gain or lose money only upon selling their stake in the team. In that sense, you can think of owning a stake in an NBA team as somewhat like stock ownership - the ups and downs of the company don't show up on your tax return unless you realize gains or losses (or earn a dividend, which are pretty stingy in the NBA because most teams lose money, so virtually all revenues have to be reinvested into the league).

When the idiot judge in Maryland tried to order a freeze on the Hawks signing new players and initially ruled that Belkin could buy out the Hawks for a box of Cheerios, that was the only time that the basketball operations was affected. It lasted all of 2 weeks, because Stern stepped in, wrote the judge, and basically made her realize that what she ordered was at odds with the owners' agreements with the NBA (not to mention common sense). Other than that, the court stuff might be distracting, but it doesn't affect the team's financial constraints. David Stern would have been demanding that the team be sold if that were the case, because the NBA is second only to the NFL in terms of how short a leash the owners are on.

The reason ASG doesn't spend more is the same as for all other teams in their position: The Hawks don't sell enough tickets or draw big enough TV crowds. That certainly DOES affect how much a team can spend, though not to the same degree as it does in the NHL and MLB because the NBA has a larger pot of shared league revenues. The Hawks have never been a big draw, and they've never had a loyal TV following. Thus, they don't earn as much money as some other teams. Thus, they don't spend as much. Ta-da.

This is a terrific post, so I'm not going to pick at any of it.

I was referring more to the "distraction," as you called it.