Below is a fascinating article on the continuing saga of Glendale Arizona and the Arizona Coyotes hockey team.    This article details about how the judge requires a Arizona Court Bond to be posted to protect the City of Glendale.

The rationale behind this posting of a court bond is because the judge further ordered the City to pay the Coyotes its regularly scheduled payment.  So, if the City were to prevail in the court action later, it would be protected through this bond.

A little bit of background: The City of Glendale, Arizona originally bid and got the rights to a stadium in which they were able to secure the Arizona Coyotes hockey team.  Over the years, however, the situation has soured for Glendale – they are continuously losing money on the deal.  Glendale wants desperately to get out of the deal while the Coyotes love this deal.  So, we are entering into a phase of negotiation brinkmanship as well as court action, etc.  It’s been very interesting for sure.

Breaking a contract

http://www.yourwestvalley.com/glendale/article_92d2b6de-1e69-11e5-b022-e7b8f2bd00fd.html

Glendale ordered to pay Coyotes $3.75M; team to post increased bond to protect city

PHOENIX – A Maricopa County Superior Court judge has ordered the city of Glendale to make its regularly scheduled payment to the Arizona Coyotes National Hockey League franchise during the parties’ ongoing contract dispute.

Judge Dawn Bergin also told team owners Monday to post a $1 million bond to be held while the parties’ case continues.

“We’re satisfied with the outcome,” stated acting City Manager Dick Bowers. “We’ve said all along that our primary obligation is to our citizens. The judge’s ruling enforcing an increase in the bond payment is an assurance for our taxpayers that we’re looking out for their best interests.”

The initial bond amount had been $250,000, according to city officials.

The city’s regularly scheduled quarterly payment to the team totals $3.75 million.

The bond would ensure the city would be guaranteed financial relief if the courts determine the city’s contract with the Coyotes to be invalid.

Both the city’s request for either a temporary hold on the entire amount of the payment or a bond to be posted by IceArizona were among options that were part of a motion filed by the city in response to the Coyotes’ filing for a Temporary Restraining Order.

The city is seeking to terminate its contract with IceArizona, the company which the Coyotes do business as. The team has gone to court, seeking to block that move and enforce the contract, Team owners have said they do not want to move the team. The Coyotes play in the city’s Gila River Arena.

The city claims state laws were broken in communications between two former city officials and the team. Glendale officials also have said the contract is a bad deal for the municipality, forcing it to shoulder a disproportionate amount of financial burden.

Regarding the communications issue, city officials have cited, Arizona Revised Statute 38-511, a law prohibiting city or state employees being a part of contract negotiations and later going to work for the other party to the deal.

Former city attorney Craig Tindall is now the team’s legal counsel. Former assistant city manager and communications director Julie Frisoni later did contract work for the team. Frisoni has denied anything improper occurred and that she had no input into the contract. Tindall has not publically commented on the matter.

The statute provides the city can void the agreement if former city employees who were “significantly involved in the initiating, negotiating, securing, drafting, or creating” the contract go to work for the other party.

The City Council June 10 voted 5-2 to terminate the Coyotes’ lease and cancel Glendale’s 13-year, $225 million contract with the IceArizona.

Meanwhile, city officials have offered to renegotiate the deal, something Coyotes officials have staunchly said they will not do.