Thursday, April 10, 2008

Sonics: The smoking e-mails

Wow. Just when it looked like the earth (or the gaping pit known as Oklahoma City) was about to open up and swallow the Sonics, the Seattle Times finds solid proof that Clay Bennett, Aubrey McClendon and Tom Ward have been lying through their hat all along about trying to keep the team in Seattle. City lawyers preparing to sue the Sonics if they break their lease found some fantastic e-mails between the ownership group. In terms of pure evidence of blatant lies, these easily surpasses most of the Nixon tapes and is up there with Monica Lewinsky's famous dress. Just read this exchange from April 17, 2007, during the one-year grace period where they were supposedly making every effort to stay in Seattle:

Ward: "Is there any way to move here [Oklahoma City] for next season or are we doomed to have another lame duck season in Seattle?"

Bennett: "I am a man possessed! Will do everything we can. Thanks for hanging with me boys, the game is getting started!"

: "That's the spirit!! I am willing to help any way I can to watch ball here [in Oklahoma City] next year."

: "Me too, thanks Clay!"

Compare that to Bennett's statement last August after McClendon was fined by the NBA for publicly announcing the group's plans to move. "It is my hope we will see a breakthrough in the next 60 days that will result in securing a new arena for the Sonics and Storm in the Greater Seattle area," Bennett said then. Back in April, he pledged to make a "good faith" effort to keep the team in Seattle.

Even better is an e-mail Bennett sent to NBA commissioner David Stern in August after the McClendon story: "You are just one of my favorite people on earth and I so cherish our relationship Sonics business aside. I would never breach your trust. As absolutely remarkable as it may seem, Aubrey and I have NEVER discussed moving the Sonics to Oklahoma City, nor have I discussed it with with ANY other members of our ownership group, I have been passionately committed to our process in Seattle, and have worked my ass off. The deal for me has NEVER changed: we will do all we can in the one year time frame (actually fifteen months) to affect the development of a successor venue to Key Arena, if we are unsuccessful at the end of the timeframe, October 31, 2007, we will then evaluate our options. I have never wavered and will not. Further I must say that when we bought the team I absolutely believed we would be successful in building a building."

This e-mail shows Bennett's arse-kissing skills in their full brilliance (and also, perhaps a bit of a conflict of interest for Stern?), along with his dire need of a lesson on punctuation. What's more important, though, is how he has been blatantly caught in a lie to the commissioner of the NBA. The other e-mails prove he discussed moving the team with both McClendon and Ward several months earlier, and was anything but "passionately committed" to Seattle: indeed, he told them he was "a man possessed" who would do everything to get the team out of town. Anyone in the same room as Bennett in the near future might not want to sit too close: his nose could unexpectedly grow a couple of feet.

Another really interesting piece of information can be found in the above e-mail, which also contains Stern's response to Bennett. "you and i are fine; i have been acting on the premise that everything you say about aubrey and your efforts is true--well before you said them; it pains me to to see the situation you are in, and i have difficulty conjuring a happy ending in seattle, but i appreciate your efforts and greatly value our friendship. i have a meeting with the ref advisory board on monday morning, which i will spend the day tomorrow preparing for, but we should try and talk early in the week--so i can calm you down. in friendship, david."

Well, the head of the NBA also could use some lessons in capitalization and punctuation. It's not entirely shocking to see such a lovely e-mail from Stern, who after all, served as Bennett's presenter when he was inducted into the Oklahoma Sports Hall of Fame last November. Funnily, as Seattle Post-Intelligencer columnist Jim Moore wrote in his great piece on the Stern-Bennett relationship, Stern usually tries to act more intelligent than everyone else. "You don't know pompous until you've met David Stern, who talks condescendingly to the media and always sounds like he thinks he's smarter than you," he wrote. Apparently, his brilliance extends to writing poorly-punctuated uncapitalized love-in e-mails to his buddy Bennett.

What's more interesting is how this response really showcases Stern's bias in this situation: according to his e-mail, he presumed Bennett's claims of innocence even before Bennett offered them. Is that really the response the NBA commissioner should be taking to serious allegations in a sport so recently rocked by scandal? The e-mail exchange shows the depth of the Stern-Bennett ties. It will be interesting to see if Stern's at all upset to find out Bennett's been lying to him for months, or if he knew all along the "keep the team in Seattle" rhetoric was hollow. In any case, Stern's conflict of interest seems pretty apparent, and he should recuse himself from the upcoming April 17-18 Board of Governors deliberation on the move.

These e-mails should cast significant doubt on the proposed relocation. Do the other owners and governors really want a guy in their club who blatantly lies to the NBA commissioner, the media and everyone else? That might be even worse PR for the league than Mark Cuban's ill-fated attempt to ban bloggers (apart from himself, of course). In fairness to Cuban, he may have ridiculous policies towards bloggers, but even he recognizes that moving a team from Seattle to Oklahoma City is a terrible idea. Hopefully, some fellow owners will join him and listen to former U.S. Senator Slate Gordon (the lawyer representing the city of Seattle)'s plan to force Bennett to sell to local heroes Microsoft CEO Steve Ballmer, Costco CEO Jim Sinegal, Seattle developer Matt Griffin and wireless magnate John Stanton: wouldn't you rather have those guys, their megabucks and their squeaky-clean by comparision images over a group that even co-owner McClendon described as "some rednecks from Oklahoma" who "made off with the team"?

There's one other possible outcome here: the return of former owner Howard Schultz, the Starbucks chairman and CEO who sold the Sonics to Bennett in the first place. Seth Kolloen, the executive editor of Sports Northwest Magazine, has a great piece about this on his blog. Schultz, as the previous owner, had Bennett sign a good-faith clause (Update: Link to a July 20 story by Jim Brunner of the Seattle Times confirming the good-faith clause) when he sold the team, which the e-mails clearly show him violating. Kolloen consulted University of Washington professor Joel Ngugi on if this could be enforced, and he came to the conclusion that it would probably have to be Schultz who took Bennett to task, rather than the city. However, it seemed from Ngugi's response that there's a pretty good chance Schultz could win (I included all of Ngugi's comments that Kolloen posted to make sure I wasn't misrepresenting him).

"Generally, even absent a specific 'good faith' term in a contract, every contract imposes upon each party a duty of good faith and fair dealing," Ngugi wrote. "As you can expect, it is notoriously difficult to determine if particular conduct comes within this definition. However, willful evasion of the spirit of a contract and lack of diligence in performing a specific term would usually come within the heart of the definition. The problem, of course, is determining if the good faith obligation assumed by Bennett and Company here was part of the spirit of the contract. ... The fact that Bennett and Company seemed not to have been acting in good faith during the negotiations of the contract (not just during its performance stage), however, raises other issues as well.It means that his lack of good faith goes to the very formation of the contract--because it vitiates [ed: law talk for 'invalidates'] the quality of consent given by the other side... Misrepresentation and fraud make the contract invalid."

That's awfully compelling. It's unclear if Schultz would be willing to step back in, but Starbucks is apparently looking for feedback on how to improve its lagging sales: saving an historic local franchise in your brand's global headquarters and recasting your CEO as a hero instead of a traitor in the process sounds like a pretty good start to me.

Update: Some more related pieces:
- Henry Abbott's piece on TrueHoop, where I first found this.
- Seth Kolloen's original post: he's been right on top of this situation.
- Commenter Charlie Anthe has some good analysis on this mess over at The Foghorn, particularly with respect to how it might cause more damage to the NBA's image.


  1. Awesome post. Where'd you get the info on the "good faith" clause in the sale contract? The Seattle Times article doesn't mention it at all, and it's the first I've heard of it. Seems like a glaring oversight in the media coverage to me - if more people knew of it, there could be a lot more pressure to invalidate the sale.

  2. Thanks for mentioning that, Charlie: I probably should have been more explicit about where I found that information. The "good faith" clause is referenced in the post by Kolloen I linked: it's originally from this July 20 Seattle Times story by staff reporter Jim Brunner. Brunner writes "It has been a year since the surprise announcement that Bennett and a team of Oklahoma City investors had bought the Sonics and Storm from the local ownership group led by Starbucks Chairman Howard Schultz.
    As part of that purchase, Bennett signed an agreement requiring a "good-faith" effort until Oct. 31 to seal an arena deal here.
    Bennett repeated Thursday that his deadline still stands. Unless substantial progress is made on an arena deal, he said, he plans to ask the NBA for permission to relocate the teams."
    I don't have access to the actual contract, but I trust the Times on that one, and it certainly makes sense that Schultz would have wanted to put a "good faith" clause into the deal to force Bennett to at least make an effort to keep the team in Seattle: those are pretty common with team sales, especially if the new owner isn't from the local area. Also, today's Times story has former Sonics president and co-owner Wally Walker mention the clause: "For the people who voted for the deal, the good-faith, best-efforts promise was a significant factor in supporting the deal," Walker said. "This is not what they signed up for."