gone corporate wrote: ↑Jul 15, 2021
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Couldn't resist using this picture now that there's the proper opportunity. Thanks for that...
Well, I’ve been following this case like a hawk, and this entire NFL drama since word first leaked in January 2014 of Stank Kroenke buying land in Inglewood. I was out of town on vacation when Randy Karraker posted his tweets. I have to say that I was open-jawed amazed at what he wrote, then danced around a bit when I read of the bench order. Seriously, I danced a bit at this…
It remains quite possible that this case will not settle and therefore will continue all the way to trial.
Punitive Damages are absolutely in play.
Quick notes:
1. The attorneys are working on a contingency basis and have fronted all the costs of the suit. No public or tax dollars have been used in any of this suit. Plus, it’s Bob Blitz’s law firm; he was the second half of the STL Task Force, along with Bob Peacock, to keep the Rams in STL. His firm’s been prepping this case with the same work notes they wrote in their efforts to keep the team here. They have incredible independence and autonomy in this suit. Since the beginning, they have stated that they want a judgment in open court, not a settlement. Even as they’re not beholden to the citizenry, public support for a judgment over a settlement is also high.
2. IANAL… Missouri law states that Circuit Judge Christopher McGraugh’s bench order could only have been issued if the courts were presented with “clear and convincing evidence” that the plaintiffs were “intentionally harmed” from fraudulent actions committed by the defendants. Now, I’ve had hopes that the STL attorneys had some strong arguments they could make, but the fact that Judge McGraugh saw enough evidence in a pre-trial hearing to make this order has blown me away at how strong our case really is. Side note: I have a very high personal opinion of Judge McGraugh and his qualifications.
3. The bench order means the financials for the named entities and individuals could be entered into the public record. The NFL has got to be beyond terrified of this. The only anecdotal financials of the NFL come from the Green Bay Packers’ annual financial statements, which are limited in size and scope. What this order will mean is that all financials and net worth assessments must be presented for the League and the Rams, as well as for Stank Kroenke (personally and professionally) and the other named owners, with the potential for other owners to be enjoined into this disclosure with that 10-day filing deadline given Monday. Think about it: some of the richest men/families/private businesses in America will have to provide full accountings of their net worth and financials to a court room, which will then have them available as part of the public record should it go to trial. How scared do you think Jerry Jones is right now? How about the League as it’s on the receiving end of future concussion-related settlements from former players?
4. Financial data is in addition to the already submitted historical phone, text, and email records of the NFL, its franchises, and its franchise owners.
5. Funniest part of this case… Bob Kraft is among the owners named by the court to provide his full financials as a part of this case… Remember a few years ago, when he was accused of attending the wrong type of massage parlor in south Florida, then had to figure a way out of it? Looks like this court order could compel him to provide ALL of that payout info... in addition to the previously submitted phone and text records! How scared do you think HE is right now?!?!?!
6. Roger Goodell admitted in his deposition that the League’s relocation guidelines are mandatory and must be followed. The evidence is admittedly clear that the Rams’ relocation did not follow these relocation guidelines. That’s a hell of a lot of the case just right there.
7. The Rams, LLC recognized loans from the NFL for the construction of the Inglewood stadium more than double the $300MM STL sought (and was chastised for seeking) from the NFL’s G4 loan program. I think they were around $700MM but could be mistaken. Exact financing will be a part of any disclosure.
8. The Big Variable: The NFL entered into a new long-term media rights deal subsequent to construction of the SoFi Stadium in Inglewood, and the Rams’ & Chargers' relocation to Inglewood. (and the Raiders to Las Vegas, which is comparably incidental at best). Games will be broadcast on ABC; NBC; CBS; Fox; ESPN; Amazon; the NFL Network; and AT&T/DirecTV. Prior to this new contract, the League’s media rights deal was estimated at around $30BB… Starting in 2023, the new ten-year contract is valued at $100BB, as it now recognizes that 2 teams are now based in the LA metro area.
ONE HUNDRED BILLION DOLLARS!!!
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These monies will be split among all 32 NFL franchises. They all will be personally enriched with this new media rights deal. This increase in media rights value will absolutely be recognized by the Plaintiffs when considering how the League has increased annuitized revenues triple that from before the LA relocation. It's not just their current net worth; it's their forecasted future annuitized revenue streams that are at play when the plaintiffs are assessing damages against them. If I were a plaintiff’s attorney, I’d absolutely argue for a share of this revenue stream on a go-forward basis as part of any judgment.
9. It’s a big story in STL media but not nationally, despite the fact that these are very, very serious charges against the League and some of its biggest owners. But, it’s not on ESPN or any of the other networks that have business relationships with the NFL for twelve-figures in cash. That’s not a coincidence. It’s not in their financial interests to bite the hand that feeds them.
10. How was the NFL so stupid as to let this happen? Simple: They never thought the case would get out of arbitration. That’s what Stank Kroenke promised them. That's why he assumed so much potential liability. That’s why he fought for this to be appealed all the way to the US Supreme Court, which denied them cert. (And remember, it was the appeal to the MO Court of Appeals which enjoined all the other NFL franchises and their ownership into the suit). They never thought this would happen. I credit hubris and a lack of foresight.
11. It is generally believed that Stank Kroneke & Kroenke Sports Enterprises assumed all costs associated to any and all legal actions that resulted from the Rams’ relocation from STL to Inglewood, that this was a precondition to the vote to relocation. We’ll see if the courts expands that liability to other parties…
12. Rumors began circulating in NFL media a couple days before Monday’s pre-trial hearing that the NFL was considering expanding to 34 teams, creating 2 new franchises, and that STL was the top contender for one of them. This is one hell of a coincidence, as well as rather unlikely. It also follows how certain NFL media back in 2018 threw out the idea of the Chargers relocating to STL to settle this lawsuit right when it was picking up momentum, which Bernie Miklasz subsequently thrashed in an article that, sadly, has a dead link today. Basically, Bernie argued that the League must pay for everything, give ownership to local leadership, admit their bad behavior, and apologize for everything – publicly – to STL, and then maybe, MAYBE, we’d consider it.
13. As Shadrack mentioned, any proof of the team tanking pre-relocation would be so mind-blowingly incredible that I have a hard time thinking about it. If he “Major League”’d us… if he Black Sox’d us… that’s for the FBI and way beyond anything that I can ramble on about, other than this would truly damn the Rams and the League. I'd think anyone connected with the business of organized gambling would be furious, let alone the Justice Department. The team’s Draft history certainly doesn’t help (building a defense when the offense needs help, making a 5’8” WR their top pick, et.al., then drafting a #1 QB once in LA)… Bring on Jeff “7-9” Fisher as a “hostile witness”.
14. There are potentially other NFL suits that can emerge from this entire mess. First, if it’s true that the fix was in the entire time that Inglewood would be built, then there’s potentially another round of fraud suits against the NFL by the Chargers and the Raiders, whose joint proposal for the Carson Stadium project was rejected for the Inglewood Stadium project. That action came after the select Owners Committee on new stadiums sided in favor of the Carson proposal by I believe 6-1 over Inglewood. The Chargers could further an argument that their current domicile in Inglewood, as Stank Kroenke’s tenants, was established by unsavory means, perhaps even leading to an argument that their brand valuation has sharply decreased in direct correlation (no tears for the Spanos family, though). Then, there exists the very real risk that there could be a push for a lawsuit by the City of Atlanta and/or the State of Georgia against the NFL and the Atlanta Hawks, whose new stadium (opened 2017) was funded with public monies through their stadium authority, the Georgia World Congress Center, in December 2014. Now, this use of hundreds of millions in public dollars was partially done with the belief that the threat remained for all teams of relocation to Los Angeles should they not receive public support for new extravagant stadium construction. If the NFL was already committed to the Inglewood proposal beginning in 2013, then the Atlanta funding came without any knowledge of this (the Rams wouldn’t be approved for relocation until 2016). I don’t know how strong their case could be, but it’d be another high profile lawsuit with underlying accusations of fraud in play.
15. The STL case is set to be held in a STL City Courtroom in mid-January 2022, right before the Super Bowl is to be broadcast from – guess where? – Inglewood, CA, about the first week of February 2022.
This really is the case of a lifetime for plaintiffs’ counsel. Godspeed.
Two Questions for any attorneys on this forum...
A. What are the possibilities of criminal fraud charges being filed against Demoff or Grubman? I’ve read something in the last day that this may happen here. Are there statute of limitations considerations, or would those be voided if the evidence for such charges emerge as part of this case’s discovery?
B. I’m trying to get a good understanding of what’s possible for Punitive Damages awards for this case… Would 3x sought damages be reasonable here? That’s my optimistic working estimate. This recognizes that we have a suit on contract law involving fraud and identifiable damages, for which preliminary damages are already estimated at $1.5-2BB; including the relocation fees of 3 teams and lost general revenues; plus the new lost opportunities from the new $100BB media rights package (which I believe could go beyond my guesstimate); leading to 3x punitive damages. Can anyone reasonably provide ballpark and max estimates?
