Ontario Supreme Court judged Frank Newbould struck down the league’s $375 million sponsorship agreement with Molson Coors – the makers of such wonderful brews like Keystone Light, Singha, Dos Equis, Coors and Molson on Friday.
The judge ruled that the league already had a deal in place with Labatts and that they reneged on the deal in order to take the bigger bucks sponsorship with Molson Coors.
The NHL will appeal.
The Molson Coors deal should not just raise eyebrows in an Ontario courtroom. The Molson family owns a considerable stake in the Molson Coors brewery. That same family owns the Montreal Canadiens.
The Molson connection obviously opens up the obvious question to debate: could there be a bit of self-dealing going on with the league’s effort to shut out the Molson family’s rival Labatts? Perhaps.
Of course, questionable deals have plagued the league of late under Bettman’s rein.
Bettman gave his blessing for the Atlanta Thrashers owners to enter into negotiations with True North Sports and Entertainment to purchase the Thrashers and move the team to Winnipeg after just a legitimate six-month search for local ownership.
True North, which has been shopping for a seventh NHL hockey team to move north of the border since 2007, quickly entered into an asset purchase agreement with the Atlanta Spirit, LLC – the owners of the Thrashers, the Atlanta Hawks and the operating rights to Philips Arena – less than three weeks after first “getting permission” to talk to the Thrashers ownership in earnest.
Of course, it helped that True North was willing to fork over a $60 million “relocation” or “breakup” fee to the league. The Thrashers owners pocketed $20 million of that fee according to numerous reports. True North also forked over $110 million to purchase the club from the Atlanta Spirit.
The league claims that the Thrashers were for sale for a couple of years. However, the Thrashers owners admitted that they could not legitimately sell the team until an intra-partnership lawsuit was settled in December 2010.
In yet another lawsuit against their attorneys in the intra-partnership dispute, the Thrashers owners claimed that they could not legitimately sell the team until the first lawsuit was settled because there was a “cloud” to the title of the Thrashers franchise. Thrashers owner Michael Gearon reiterated this in a radio interview on the Buck and Kincade Show in February.
A “cloud” of title is legalese for the common-sense notion that you can’t sell something if you do not know whether you own it or not or if you did, you would fetch a less than fair market price. The intra-partnership lawsuit against rogue partner Steve Belkin – which was initiated over the trade of Joe Johnson to the Hawks in 2005 – was all about who owned the team and who could buy out whom.
However, there doesn’t seem to be much common sense going around either the Thrashers organization or in the top levels of NHL circles, who are on the cusp of moving the team to Winnipeg despite admissions by Thrashers ownership that they could run the Thrashers next year and that hockey could work in Atlanta.
At least to some of those in Atlanta, the sale seemingly went against the so-called “Bettman Doctrine,” where teams are not moved unless all local options have been exhausted first.
To Winnipeg’s credit, the fans there have done everything they possibly could to demonstrate that hockey will work there. They quickly reached the 13,000 ticket plateau – a condition set by an almost-dictatorial Bettman at the press conference announcing the Thrashers’ sale and move to Manitoba’s largest city – when tickets went on sale to the general public on Saturday.
That is looked at by many as the final stumbling block to approval of the move and sale by the NHL’s Board of Governors, which meets on June 21 in New York. It takes three-fourths vote to approve the sale to True North and a simple majority to move the club to Winnipeg.
The beer wars are nothing new in a cutthroat brewing industry where Bud Light and Budweiser are No. 1 and No. 2 respectively in the United States. Coors Light is No. 4. Molson Coors also distributes No. 3 Miller Light within in the U.S.
Labatts Blue is the top-selling label in Canada. Molson Canadian is No. 2.
Labatts is owned by InBev, which also distributes Budweiser in Canada. Labatts is brewed and distributed by North American Breweries in the United States until 2012 due to antitrust concerns. InBev is the largest beer brewer in the world.