Elway defends current team owner in court

Updated: February 6, 2004, 5:43 PM ET
Associated Press

DENVER -- Less than a week after being voted into the Hall of Fame, former quarterback John Elway took the stand Friday in the long-simmering dispute between the current and former owners of the Denver Broncos.

Former owner Edgar Kaiser says he was cheated of a chance to buy back part ownership of the football team that has been part of Denver's fabric for decades.

His federal lawsuit accuses current owner Pat Bowlen of distributing ownership interests in the Broncos to family members in violation of their 1984 sale agreement. Kaiser also said Bowlen gave Elway a chance to buy a a stake in the team, despite a provision that gave Kaiser the first shot at any such offer.

If Kaiser wins, a second trial will be held to determine what Bowlen owes Kaiser, which could include monetary damages -- or even a chance to buy a share of the team.

Bowlen's attorneys, however, say Kaiser was aware of Bowlen's ownership plans and that Kaiser is trying to buy back a share of the team at 1984 prices.

Dressed in a blue blazer and khakis, Elway testified Friday that from the time Kaiser sold the team he understood Bowlen to be the team owner. But he also said it was common knowledge within the organization that members of Bowlen's family had some ownership involvement.

Kaiser bought the Broncos for about $30 million in 1981. Bowlen bought a 60.8 percent stake from Kaiser for $65 million three years later, and bought the rest from minority shareholders in 1985.

Bowlen's attorney, Daniel Reilly, said sales documents show that Bowlen family holdings were guaranteeing Bowlen's payments to Kaiser -- indicating that ownership would be distributed among the family and that Kaiser should have known about it.

But Carr Ferguson, a tax lawyer who advised Kaiser on the sale, testified that he and Kaiser never believed that ownership interests would be distributed among Bowlen's family. He said the sale agreement was drafted to ensure that Bowlen would be the sole owner of the Broncos.

Kaiser says violation of that agreement would be a breach of contract.

Ferguson also said Kaiser told him after a private meeting with Bowlen that Kaiser would have an unqualified right of first refusal if Bowlen ever decided to sell all or part of the team.

"He said he would always bleed orange and blue for the rest of his life, and he chose Pat Bowlen (as the buyer) because he thought Pat had those same qualities of dedication and commitment and the financial strength to improve the team," Ferguson said.

"I believed (Kaiser) was not emotionally letting go of the team, and he wanted to be absolutely certain the team was in good hands and that if necessary he could intervene to bring it back into his own hands."

The dispute, which dates back several years, has been nasty.

Earlier this week, Kaiser testified he once called NFL officials to report rumors of drug use by two minority stake partners. He said he felt obligated to make the report and denied trying to undermine the men so he could sell full ownership to Bowlen for a higher overall price.

Under questioning by Kaiser's attorneys, Elway said that after he retired from the team in 1999, Bowlen offered him a deal to buy up to a 20 percent stake in the team and work for Bowlen, eventually becoming the team's chief operations officer.

Kaiser's attorneys said that proved Bowlen had ignored the requirement to give Kaiser the first chance to buy an ownership interest in the team.

Elway said he decided against taking Bowlen's offer because he didn't want to be a minority shareholder. Bowlen's attorneys have disputed Kaiser's claim to a right of first refusal, and said the question was moot because Elway declined the offer.

Bowlen also said in court filings the offer to Elway was for a share of the team's parent firm, Bowlen Sports Inc., not the franchise itself.


Copyright 2004 by The Associated Press