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THN.com Blog: Expert says mediation ruling is good news for Moyes, Balsillie

Where the Coyotes will end up playing next season is still up in the air. (Photo by Norm Hall/NHLI via Getty Images)

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Where the Coyotes will end up playing next season is still up in the air. (Photo by Norm Hall/NHLI via Getty Images)

Perhaps Judge Redfield T. Baum is expecting the NHL and the Phoenix Coyotes to do the impossible. But kudos to him for essentially telling both sides to lock themselves into a room for a week and come back to him with a solution or one will be worked out for them.

That’s because since all this high drama started, we have seen a lot of posturing and rhetoric and court filings where one party is clearly not telling the truth. What we haven’t seen is the two sides apparently doing anything in an effort to perhaps find some common ground and come to some kind of solution that works for everybody.

“It’s an interesting game of brinkmanship and playing chess at the same time,” said Richard McLaren, a law professor at the University of Western Ontario who specializes in sports law and bankruptcy and has been watching the situation closely.

McLaren is well known in the sports legal world. He has served as an arbitrator at five Olympic Games and has been a mediator in a number of major disputes, both in and outside of the world of sports.

McLaren said that while nothing definitive came out of the first hearing Tuesday afternoon, he did say that if the judge had found the NHL, and not Jerry Moyes, to be in control of the Coyotes, the bankruptcy proceedings would have come to a quick end because it would have meant there was an improper filing. The fact that he did not throw the case out and instead sent it to mediation, indicates to him that the NHL did not get the news it was seeking.

“The judge said that the NHL would have to strictly prove its legal position,” McLaren said. “Well, that’s judicial-ease for, ‘I don’t think you’re going to get there, so you’d better come to a compromise in mediation.’ ”

Again, things are almost certainly far too along and there is far too much acrimony and bad faith on both sides for this to work, particularly since he wants both sides to report back to him within a week. The two sides are coming from such diametrically opposed positions that it’s probably expecting too much for them to come to a consensus on anything.

“They certainly can’t resolve anything on the stated grounds of each side at the moment,” McLaren said.

But isn’t it just a little refreshing to see these guys having to take some serious ownership over this issue? The mediator in this case will certainly face a monumental task, but a pox on both their houses if each side continues to remain entrenched and unwilling to discuss anything beyond the parameters of its narrowly defined terms.

Baum has essentially told both sides that, while his job is to look out for the interests of the team’s creditors, the case is far to tangled and complex for him to make a quick ruling. So it was actually encouraging to see him tell the principal players to go out and try to clean up their own mess first before dragging the whole thing through the courts.

McLaren said one of the reasons the judge opted for mediation was essentially to buy time for both sides and the court. And he said whether or not anything comes out of mediation will depend on whether or not NHL commissioner Gary Bettman continues to cling to the notion that the team must stay in Phoenix. He said he believes it’s a “foregone conclusion” that the team will play in Phoenix for at least one more season, but if the judge is forced to make a ruling in the case it could open up a legal quagmire that nobody wants to see.

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That’s because Baum could essentially side with Moyes in this case and could rule that the sale to Jim Balsillie is the best offer the creditors are going to receive. He has the power to rule that the sale to Balsillie meets all legal requirements and that the franchise must be moved to Hamilton, essentially overriding the NHL’s territorial provisions and the contracts that are already in place in Phoenix.

But what he has no power over is how the NHL treats the franchise after that. He said it’s conceivable that Balsillie could have an NHL franchise in Hamilton, but that the league could simply refuse to put the team on the schedule or allow it to participate in things such as the entry draft.

“Those are the eggshells the judge is walking on,” McLaren said.

The NHL has essentially already been forced to come clean about the massive losses in Phoenix and publicly acknowledge how desperate the situation had become in the desert. We know now, because of this process, what everyone suspected for a long time – that the NHL was whistling in the dark about its situation in Phoenix and that the losses were staggering. Not that we ever believed it before, but how are we supposed to now swallow his happy talk when he tries to convince us things are going just swimmingly in markets such as Nashville, Florida and Atlanta?

On the other side, Jerry Moyes is casting himself as a working stiff who just wants to recoup a hundred million dollars or so, but am I the only one thinking that his entire scheme to sell to Balsillie didn’t really pass the ethical smell test from the start, particularly since he was one of the team’s largest creditors?

Undoubtedly, these things will be discussed at length when the two sides sit down with a mediator over the next week. And who knows? Perhaps it will force both of them to be a little more honest than they’ve been to this point. If nothing else, that might be worth the time and effort it is taking to go through this process.

THN.com's Playoff Blogs, featuring analysis and opinion on the action from the night before, with insight on what happened and what it all means going forward, will appear daily throughout the NHL playoffs. Read more entries HERE.

Ken Campbell, author of the book Habs Heroes, is a senior writer for The Hockey News and a regular contributor to THN.com. His blog appears Wednesday and Fridays and his column, Campbell's Cuts, appears Mondays.

For more great profiles, news and views from the world of hockey, subscribe to The Hockey News magazine.

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