The Judge's Ruling

[yardbird]

Yep.

[yardbird]

This morning's AJC (Tim Tucker & Sekou Smith)cites another clause in the partnership agreement that ATL/WAS relied on: " . . .there is no opportunity to rescind if the removable action is a willful or intentional violation of a stated position of the majority of the group . . ."

I don't think this judge has final say on which clause wins. ATL/WAs has a decent argument after all, but impossible to say right now who wins. I wouldn't want this judge to make that call, however (he has indicated that Belkin can rescind already.

I'd post the link to the story if I knew how to do that here (I'm too new).

[AHF]

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As for the 5-day notification clause, due process is important, but 5 days for something the Governor knows is contrary to the wishes of the Board of Managers is a little long. 3 days would be plenty, but they'd have to modify the LLC Operating Agreement in order to do that.

There's really no way around some sort of notice requirement, and I would not try to start the clock before today. I would send Belkin official notification today and start the watch, then remove him 5 days on.

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Based on the contract language quoted in the AJC there is a provision for NO NOTICE if the governor intentionally and knowingly does something against the stated intent of the Board of Managers.

I do have a problem with the Judge effectively ruling that Belkin had not intentionally acted against the stated intent of the BOM. He hasn't conducted the necessary fact-finding to reach that conclusion. What he should have done was simply to point out that if the Atlanta Spirit LLC could not prove this they would have to provide 5 days notice. IMO, it was not his place to state in dicta (i.e., not part of his legal ruling but part of the opinion) that the Hawks needed to provide 5 days written notice.

As I've said, this judge is bad news for anyone involved other than Belkin. I don't think he has committed any reversable error but he is treading on the edge, IMO.

[yardbird]

Here you go . . .

http://www.ajc.com/sports/content/sports/h...5/12belkin.html

[Nurlman]

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Based on the contract language quoted in the AJC there is a provision for NO NOTICE if the governor intentionally and knowingly does something against the stated intent of the Board of Managers.

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I missed that. I've never seen the LLC Operating Agreement, only going secondhand. Tim Tucker's my best source. Anybody got a link?

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I do have a problem with the Judge effectively ruling that Belkin had not intentionally acted against the stated intent of the BOM. He hasn't conducted the necessary fact-finding to reach that conclusion. What he should have done was simply to point out that if the Atlanta Spirit LLC could not prove this they would have to provide 5 days notice. IMO, it was not his place to state in dicta (i.e., not part of his legal ruling but part of the opinion) that the Hawks needed to provide 5 days written notice.

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Good point. In the hearing, he spent significant time opining on the merits of the trade, as I recall. Don't know if that made it into the first order. Taken in the context of a mediocre opinion and some lousy legal writing, I'm not surprised he skipped a step and added his two cents, are you?

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As I've said, this judge is bad news for anyone involved other than Belkin. I don't think he has committed any reversable error but he is treading on the edge, IMO.

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Looks like he'll be a good boy and leave the decision making to Stern and the NBA, though he took some shots at Stern on his way out. Lousy judge. Borderline incompetent.

[Diesel]

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I do have a problem with the Judge effectively ruling that Belkin had not intentionally acted against the stated intent of the BOM. He hasn't conducted the necessary fact-finding to reach that conclusion. What he should have done was simply to point out that if the Atlanta Spirit LLC could not prove this they would have to provide 5 days notice.

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AHF,

I hate to be a stickler for simplicity... But Doesn't the notice say that if Belkin intentionally makes a move that he knows is against the wishes of the BOM, he can be removed??

If that is so, this judge really screwed us.

[sick_five]

And if the judge completely ignores this very important clause in the statement, I would think his ruling could be overturned with an appeal. I'm surprised, though, that the Hawks lawyers did not bring this up in court the first time. (Maybe they did?)

The judge does need to be scolded, though. His decision was biased to begin with, and according to this contract, especially this clause, Belkin should have been ousted Tuesday.

[Nurlman]

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I do have a problem with the Judge effectively ruling that Belkin had not intentionally acted against the stated intent of the BOM. He hasn't conducted the necessary fact-finding to reach that conclusion. What he should have done was simply to point out that if the Atlanta Spirit LLC could not prove this they would have to provide 5 days notice.

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AHF,

I hate to be a stickler for simplicity... But Doesn't the notice say that if Belkin intentionally makes a move that he knows is against the wishes of the BOM, he can be removed??

If that is so, this judge really screwed us.

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No, I don't think so. I think they now need to formalize the paper trail showing that he acted against the wishes of the BOM by giving him written notice and 5 days to cure the problem, after which he can be removed.

In other words, now that you've obtained this OK from the commissioner, the injunction is lifted, start your due process now, and be very specific in complying with the terms of your own agreement - assumedly so that the contract rights of the opposing party (Belkin) are not infringed upon.

I don't think he screwed AS, LLC, but most judges want to avoid being invasive, and now that the perceived vagueness has been resolved (see the order) this judge is trying to get the parties to let the agreement govern.

That's as good as we can hope for, I think. He doesn't like the AS, LLC people's business judgement, and he sure as hell doesn't like David Stern, who basically schooled him after the hearing granting the temporary injunction. I never saw the order, so I don't know how many of his comments were in the courtroom versus in the order, but he was all over the map and completely off point. Stern, on the other hand, told him the issues and how to rule, which he grudgingly did after a backhand to Stern.

[AHF]

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I do have a problem with the Judge effectively ruling that Belkin had not intentionally acted against the stated intent of the BOM. He hasn't conducted the necessary fact-finding to reach that conclusion. What he should have done was simply to point out that if the Atlanta Spirit LLC could not prove this they would have to provide 5 days notice.

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AHF,

I hate to be a stickler for simplicity... But Doesn't the notice say that if Belkin intentionally makes a move that he knows is against the wishes of the BOM, he can be removed??

If that is so, this judge really screwed us.

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No, I don't think so. I think they now need to formalize the paper trail showing that he acted against the wishes of the BOM by giving him written notice and 5 days to cure the problem, after which he can be removed.

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Playing newspaper lawyer, it appears there are two clauses that can be used to remove Belkin. One provides 5 days notice if he is taking an action contrary to the intent of the Board of Managers. That is the one the Judge told the AS LLC that they needed to comply with.

I think he overstepped his bounds in doing so based on this:

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The owners seeking to oust Belkin had thought another clause in the partnership contract applied in this case. That clause states that there is no opportunity to rescind if the removable action is a "willful or intentional violation of a stated position" of the majority of the group. That clause was not cited in the judge's ruling.

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I don't think it could be any clearer that Belkin's actions are williful and intentional violation of a stated position. At a minimum, the judge should simply have pointed out the two provisions and told the AS LLC that they ran the risk of being overturned if the Court concluded they were wrong to use the no notice provision. Those provisions are similar to a notice/just cause provisions commonly used in termination clauses for executives in employment agreements. Since the Judge hadn't done the fact-finding to determine which was applicable (and that would turn on a factual finding), he should not have told the AS LLC that they have to follow the notice provision, IMO.

I also wonder if the emails they sent to Belkin referenced in the AJC today would constitute written notice. They clearly tell Belkin he will be removed if he blocks the trade and more than 5 days has passed since those were received by Belkin.

[Nurlman]

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I do have a problem with the Judge effectively ruling that Belkin had not intentionally acted against the stated intent of the BOM. He hasn't conducted the necessary fact-finding to reach that conclusion. What he should have done was simply to point out that if the Atlanta Spirit LLC could not prove this they would have to provide 5 days notice.

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AHF,

I hate to be a stickler for simplicity... But Doesn't the notice say that if Belkin intentionally makes a move that he knows is against the wishes of the BOM, he can be removed??

If that is so, this judge really screwed us.

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No, I don't think so. I think they now need to formalize the paper trail showing that he acted against the wishes of the BOM by giving him written notice and 5 days to cure the problem, after which he can be removed.

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Playing newspaper lawyer, it appears there are two clauses that can be used to remove Belkin. One provides 5 days notice if he is taking an action contrary to the intent of the Board of Managers. That is the one the Judge told the AS LLC that they needed to comply with.

I think he overstepped his bounds in doing so based on this:

Quote:

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The owners seeking to oust Belkin had thought another clause in the partnership contract applied in this case. That clause states that there is no opportunity to rescind if the removable action is a "willful or intentional violation of a stated position" of the majority of the group. That clause was not cited in the judge's ruling.

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I don't think it could be any clearer that Belkin's actions are williful and intentional violation of a stated position. At a minimum, the judge should simply have pointed out the two provisions and told the AS LLC that they ran the risk of being overturned if the Court concluded they were wrong to use the no notice provision. Those provisions are similar to a notice/just cause provisions commonly used in termination clauses for executives in employment agreements. Since the Judge hadn't done the fact-finding to determine which was applicable (and that would turn on a factual finding), he should not have told the AS LLC that they have to follow the notice provision, IMO.

I also wonder if the emails they sent to Belkin referenced in the AJC today would constitute written notice. They clearly tell Belkin he will be removed if he blocks the trade and more than 5 days has passed since those were received by Belkin.

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I don't disagree with your analysis, but I don't trust this judge. If it were my client, I would advise them to give formal notice of violation to Belkin subsequent to the judge lifting the injunction, wait five business days (even though the contract seems to read five days, period), then convene and remove him. It's only another week, and Joe can keep shopping for houses.

[AHF]

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I don't disagree with your analysis, but I don't trust this judge. If it were my client, I would advise them to give formal notice of violation to Belkin subsequent to the judge lifting the injunction, wait five business days (even though the contract seems to read five days, period), then convene and remove him. It's only another week, and Joe can keep shopping for houses.

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Agreed. But if Belkin relents on the trade during those five days you are running the risk of keeping him as governor. I guess they could try to have it both ways by giving him the five days notice and telling him (after he allows the JJ trade) that they are going to remove him under the other clause if he changes his mind.