The owner of the now-defunct Alliance of American Football Spring League now not only wants to be off the hook in bankruptcy proceedings, but has filed to try to get his entire $70 million investment back.
However, we’ve learned, that it’s not going to be easy for either one.
First, the story was broken Tuesday afternoon by sports business writer Daniel Kaplan of the Athletic, who learned from sources about the court filing on behalf of Thomas Dundon, billionaire owner of the Carolina Hurricanes, that he wants his investment back:
— daniel kaplan (@KaplanSportsBiz) June 25, 2019
According to Kaplan, Dundon argues in the legal filing that the AAF led by Charlie Ebersol and former NFL executive Bill Polian lied to him about the actual debt of the league to the tune of an additional $13 million that they had not disclosed. He further alleged that the actual price tag to keep the league in business for year one was closer to $120 million not the $70 million that he was attempting to keep the league afloat with in February and March.
As we have written repeatedly, the AAF shut down on April 2nd, eight weeks into its inaugural season, with Steve Spurrier’s Orlando Apollos having the best record and being the odds-on favorite to win the first championship.
As part of the bankruptcy proceedings, the University of Central Florida, and Spectrum Stadium on their campus, are still seeking to get payment on over $1 million for use of their facility in February and March for Apollos home games.
A source with knowledge of what Ebersol, Polian and the AAF intend to continue to argue told F.F.I. recently, that Dundon is going to have great difficulty convincing the bankruptcy court that he isn’t responsible for the debts.
This is for several obvious reasons.
Most prominently, because Dundon assumed all of the operational costs of the Spring league, when he announced himself as the Chairman of the Board in early February, including making payroll.
Second, he repeatedly gave interviews publicly stating that he intended to infuse up to total of $250 million into the league to keep it afloat for three seasons. Thus, indicating that he clearly had money and plan to pay debts, to do so.
Thirdly, it’s also well known that Dundon had the ability to buy the Carolina Hurricanes in January of 2018, and therefore, obviously, has tens of millions of dollars in cash flow at his disposal to begin paying off AAF creditors.
There are also multiple lawsuits pending against Ebersol, Dundon and the AAF on behalf of former coaches players and employees, as well. More than 1,000 full-time people were put out of work less than four months into their employment, when Dundon shut the league down.
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