Just when the Nashville Predators seemed to be skating more smoothly under new ownership the team has entered what seems to be becoming an annual event — upheaval.
This time last year, the team’s ownership was in turmoil when former owner Craig Leipold entertained offers for the ice hockey team.
Now William “Boots” Del Biaggio — the Silicon Valley minority owner whose involvement helped make the deal happen — perhaps was trying to sit at the adult table when he should have been sitting at the kid’s table.
Lawsuits against him claiming fraud, a federal investigation and bankruptcy have nixed his ability to personally guarantee $9.8 million of the $50-million exit fee should the team break the lease and leave.
Members of the David Freeman-led local ownership group easily could end any worries from the Metro Sports Authority over Del Biaggio’s portion of the personal guarantee by picking it up themselves until a buyer can be found for Del Biaggio’s 27-percent stake.
Of course, it’s not easy on the individuals.
Guaranteeing another $9.8 million puts a bigger crimp in each of their abilities to obtain loans in their private lives for the next 20 years. Every time they go to borrow money even for a home they have to list that added contingent liability.
Folks opposed to the Predators deal won’t feel sorry for them. Still, the local ownership group could easily end any city discussion about default.
Now, there’s the question of what to do with Del Biaggio’s share. That may take some time to answer.
The upside to the San Jose businessman’s situation is that his ownership stake doesn’t include a requirement to put more money into the team should more be needed to cover operating losses or if the owners want to chase a player.
It is probably good that Del Biaggio’s role had been limited, even though at one point, this guy seemed to hold all the cards.
He was the man who might buy the team.
He was the man who might have moved the team to Kansas City.
Several years ago, he was the man who was going to save the Pittsburgh Penguins from financial ruin.
Del Biaggio was ‘the man’ with the NHL. He was a known quantity because of his minor stake in the San Jose Sharks and the league liked him — so much so, in fact, that it was willing to put him ahead of billionaire Jim Balsillie in buying the Predators.
Instead, it turns out Del Biaggio was living in a house of cards. If anyone has egg on their face, it’s the NHL’s top officials.
On Friday at a meeting where attorneys announced the ownership group should find a Del Biaggio replacement by Aug. 4, Metro Sports Authority attorney Larry Thrailkill didn’t mince words.
“Mr. Del Biaggio is the one to blame,” he said.
Del Biaggio wasn’t necessarily the local ownership group’s choice. That was more like a shotgun marriage to make a deal happen and beat the clock. Interestingly, in the middle of the negotiations in the final hours of the exclusivity period last October, Del Biaggio brought Doug Bergeron, chief executive office of San Jose-based VeriFone, into the negotiations.
For whatever reason, Bergeron didn’t get involved. Perhaps now everyone knows why. Bergeron, as a director of DGB Investments, signed the lawsuit against Del Biaggio claiming the Predators investor had fraudulently obtained a $3 million loan last November.
That month, the deal with the local ownership group and Del Biaggio was moving fast and furious. When the loan came due in May, Del Biaggio apparently couldn’t pay it and was sued.
Had the local ownership group been able to hold off for a few months it may have known that it was about to bed down with trouble and nixed ‘Boots.’ The group didn’t have time.
But that gets filed under “coulda, shoulda, woulda.”
For now, it will take time to unravel Del Biaggio’s involvement.
The Chatter Class appears Mondays in The City Paper. Comments may be sent to firstname.lastname@example.org