- Lester Munson, Legal Analyst
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Every day, on every sports Web site, on every sports broadcast and on every sports page, it isn't difficult to find headlines shrieking about arrests, investigations, indictments, lawsuits, even legislation. It is difficult, though, to keep track of them after those headlines have passed into yesterday. Sometimes, it isn't easy to understand what's already happened, what's happening right now and what's going to happen next. And these stories are important. If we've learned anything at all over the years, it's that issues of violence, money, drugs, sex, celebrity and race are here to stay in the sports industry.
This occasional column will address these issues, put them into context, have fun with them when appropriate and offer a look at what is likely to happen in the days, weeks and months to come.
We start with
Embarrassing Mark Cuban
It was never polite. It was never civil. From the moment the Securities and Exchange Commission on Nov. 17, 2008, accused Mark Cuban of violating the rules against insider trading of stocks, it was ugly. And now, as Cuban and his team of nationally known lawyers and law professors bask in the glow of an unexpected first-round TKO of the SEC, it's even worse.
In a court motion that bristles with righteous indignation, Cuban accuses the SEC staff of "misconduct," "abuse," "fraud" and "oppression." The SEC, Cuban asserts, caused him "public embarrassment."
Can you imagine? Mark Cuban in a situation of public embarrassment?
The people at the SEC were conspiring against him from the beginning of their investigation, Cuban suggests, looking for a "high-profile insider trading case." Their conduct was so egregious that the SEC should now be required to pay his legal fees, he insists.
It's a highly unusual request that is rarely granted in an SEC case. Instead of an SEC check in payment of his fees, Cuban is likely to draw an appeal of the first ruling. That decision, from Chief Judge Sidney Fitzwater of the U.S. District Court in Dallas, is based on an idea never before advanced in the laws of insider trading.
It's a ruling the SEC must challenge, and even attack. Early in October, Cuban can expect the official notice of the appeal.
Bad knees? Concussion? Or DUI?
When a Virginia Beach, Va., police officer clocked former NFL great Bruce Smith at 73 miles per hour on a shoulder of an interstate that was closed to traffic on May 15, he pulled Smith over and, according to his later court testimony, immediately detected a strong smell of alcohol. As the officer tried to perform sobriety tests, Smith told him that knee injuries from his playing days (11 surgeries) made it difficult to walk heel-to-toe in a straight line.
It didn't work.
The officer, in a video of the arrest, replies, "Yes, I know who you are. I know what you did in your career." The officer, Bryan Womble, was not convinced that Smith was sober.
It did not help that Smith refused to take an alcohol breath test. Womble charged him with speeding and DUI.
Smith and his attorney, Larry Cardon of Norfolk, Va., were unsuccessful in the first trial on the charges. This time, Cardon asserted that multiple concussions during Smith's 19 years in the NFL had made it difficult for Smith to follow Womble's hand movements in another sobriety test.
That didn't work, either. The judge in the first trial gave Smith a suspended 90-day jail term, a fine of $350 and a one-year suspension of his driving privilege.
Now, Smith and his attorney will have yet another chance in a second trial, scheduled for Nov. 5. Under Virginia law, Smith is entitled to what is known as a "trial de novo," a courthouse do-over with the witnesses returning to repeat their testimony. It will give him another opportunity to sell the bad-knees-and-concussions theory.
Trouble is, it will also give the prosecutors a chance to stick Smith with a stiffer sentence. It could be worse the second time around.
The Bankruptcy War
In exactly 40 days, General Motors entered bankruptcy and emerged from bankruptcy totally reorganized and ready to battle for survival.
The Phoenix Coyotes entered bankruptcy four months ago, and the team is nowhere near a program for its survival.
What could and should have been just a skirmish is now a full-fledged war. National Hockey League commissioner Gary Bettman and a battery of high-powered lawyers have been pounding Jim Balsillie, the Canadian billionaire who is willing to pay $242 million and probably more for the insolvent team if he can move it to Hamilton, Ontario.
They might be pounding on the wrong guy.
Bettman insists that the team belongs in a small market in the desert Southwest that has demonstrated little interest in hockey despite the presence of Wayne Gretzky as its coach. Balsillie wants to put it in an extended market that might be the most lucrative in hockey. The Toronto Maple Leafs, some 40 miles from Hamilton, have sold out every home game since 1951. A fan in Toronto can wait for a generation for an opportunity to buy a season ticket.
Is there room in the Toronto market for another team in a sport that is uniquely Canadian? Certainly seems so.
Bettman's assault on Balsillie included a mammoth investigation by Kroll, the global private investigation firm, which concluded that Balsillie somehow lacked the "character and integrity" to qualify as an NHL owner.
Bettman should read the Kroll report very carefully. Even though it is marked "HIGHLY CONFIDENTIAL," it is filed in the bankruptcy court in Phoenix. In their report, the Kroll investigators state that they learned that Balsillie views the NHL as an "illegal cartel."
It is, of course, a cartel. Whether it's illegal remains to be determined. But to prove its illegality, Balsillie has brought in Jeff Kessler, one of America's finest antitrust lawyers. Balsillie, Kessler and other attorneys are ready to attack the NHL cartel if they don't get what they want in the Arizona bankruptcy court.
The bankruptcy battles so far could be only the beginning. Balsillie and Kessler are ready to file an antitrust attack on the NHL that could restructure the league. What General Motors accomplished in 40 days, the NHL might not be able to accomplish in two or three years.
This war will continue.
Lester Munson, a Chicago lawyer and journalist who reports on investigative and legal issues in the sports industry, is a senior writer for ESPN.com.