|Wednesday, January 29
County executive taking no chances in relocation
BUFFALO, N.Y. -- Erie County hired its own legal counsel Wednesday to prevent the potential relocation of the bankrupt Buffalo Sabres.
The move comes two weeks after the Sabres filed for Chapter 11 bankruptcy protection. Prospective owners Mark Hamister and Todd Berman have until Monday to sign an asset purchase agreement, expressing their conditional intention to buy the franchise.
While the prospective owners are intent on keeping the team in Buffalo, bankruptcy opens the opportunity for outside parties to make competitive bids on the Sabres and potentially move them elsewhere.
County executive Joel Giambra is taking no chances, hiring William F. Savino, one of Buffalo's top business attorneys.
"The threat of moving this team is something that we're going to fight and resist at every step of the way," county executive Joel Giambra said. "It would be a tremendous injustice to this community from a financial standpoint and psychological (standpoint) to allow this team to leave.
"We're going to throw everything but the kitchen sink into our position."
The county holds a 25 percent share of HSBC Arena, the Sabres' home, and has more than 23 years left on its lease with the team -- which includes a strict non-relocation clause agreed to by the NHL.
NHL commissioner Gary Bettman has insisted he wants the Sabres to remain in Buffalo but has added that the team could fold or move after this season should Hamister and Berman fail to complete their purchase.
Savino said there are several points, including the county's lease, he plans to argue to convince Buffalo bankruptcy judge Michael Kaplan to block the Sabres from moving.
Savino said the Sabres' case has precedence, noting that in 1998, a bankruptcy judge ruled in favor of the then-bankrupt NHL Penguins' request to remain in Pittsburgh before they were eventually sold to Mario Lemieux.
Savino said he also will argue that the county would file for compensation -- adding to the team's long list of creditors -- from any prospective owner wishing to move the franchise.
He wouldn't say how much the county would seek in compensation, only suggesting the figure would be "very large."
Bankruptcy hearings on the Sabres' future and potential sale aren't expected to begin until late next month at the earliest.
The Sabres have been in limbo since the NHL took over operational control from then-owner John Rigas last June. Rigas has since been accused of stealing hundreds of millions of dollars from Adelphia Communications, the cable television company he founded.
Adelphia, which filed for bankruptcy protection last June, is the Sabres' largest creditor, owed between $130 million and $160 million in money Rigas used to purchase and operate the team in the mid-1990s.
Hamister and Berman last week were granted their fourth NHL extension, the latest which runs out on Monday, to gain Adelphia's approval to complete the asset purchase agreement.
Signing the agreement would be only one step in a complex sale process.
The prospective new owners would then have to be approved by both an Adelphia bankruptcy court judge in Manhattan and the Sabres bankruptcy court judge in Buffalo.
Hamister and Berman also have said the sale is contingent on them receiving more than $40 million in public assistance, which has yet to be fully approved.