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Why Does Gary Bettman Hate Canada?

Okay, maybe he doesn't really hate Canada, but he sure doesn't like it very much. In his sixteen years as commissioner of the NHL he has done everything he possibly can to grow the game in the US at the expense of Canada. Since he took over, all expansion franchises and relocated franchises have been placed in American cities, sometimes - Jets and Nordiques - at the expense of Canadian cities.

The latest and most blatant example is unfolding in the Valley of the Sun. The ongoing debacle of the Phoenix Coyotes may be a textbook example how mismanagement of a situation turns a merely bad one into a raging financial and public relations disaster. A short background in the Coyotes recent history will help you understand the current situation.

The franchise has been hemorrhaging money for the last several seasons, to the tune of $73 million in the last three fiscal years, and in August, 2008, owner Jerry Moyes notified the NHL that the team would have trouble meeting its obligations for the 2008-09 season. Later that month, the league advance the club $8 million and went on to lend the Coyotes a total of $35 million during the season, allegedly making it the second largest creditor after an affiliate of computer magnet Michael Dell. I say allegedly because that is the claim in the NHL's most recent bankruptcy court filing, however, a significant portion, at least $100 million, of Moyes' investment in the team is in the form of debt, which would make him the largest creditor by a significant margin.

According to the league's filing, in October Moyes notified the league that he was done funding the team's losses and in November, he signed control of the team over to the league. What exactly that meant will be decided by the bankruptcy court. The league contends Moyes no longer had the power to file bankruptcy while he contends that he only signed over control of day to day operations and financial decisions and that he retained ownership and therefore control of the ability to file bankruptcy and accept purchase offers, subject to league approval of the purchaser just like any other sale of a team.

Where this story gets really interesting is that Moyes/Coyotes have received a $212 million offer from Jim Balsillie to purchase the team and move it to Hamilton, Ont. Bettman, who may not really hate Canada but almost assuredly does not like Balsillie, wants to quash that sale and instead sell it for $130 million to Jerry Reinsdorf, of White Sox and Bulls fame, contingent on getting a new and much improved lease with the City of Glendale. So far, Glendale officials are not enthusiastic about altering the lease so where does that leave Bettman/Reinsdorf? Thinking about Las Vegas apparently.

This story gets more tangled by the minute, but the major takeaway for me is the continued efforts by the commissioner to prevent any relocation of a franchise (Pittsburgh, Nashville, Phoenix, Atlanta) to a Canadian city where it will almost assuredly be successful, and instead his near slavish devotion to failed vision of expansion in the American Sun Belt. How much longer will the Board of Governors permit this travesty to continue? Did the league expand to the Sun Belt for failing franchises just to get its games televised on Versus? Whendoes Canada get its game back?

Full post as published by Sports Biz on May 16, 2009 (boomark / email).