The Save The Coyotes Coalition

Balsillie: The Man, The Myth, The Legend?

By: hipchecks

James “Jim” Balsillie was born and raised in Ontario, Canada. He spent some time in the United States as he earned his Masters in Business Administration from Harvard. He is a chartered accountant (similar to the American CPA) and the current CEO of RIM/Blackberry. His estimated net worth is 3.4 billion, making him the ninth richest person in Canada.

In 2005, while still in the appeals process it looked like there would be a settlement of $450 million but negotiations halted and the case went back to court. In 2006 the Supreme Court sent the appeal back down to a lower court without hearing it. The injunction was about to come to light but finally a settlement of $612.5 million was reached. Had the injunction happened, all blackberries in the US would cease to work at their full potential, which many clients had become addicted to. This could have been disastrous.

Did Balsillie settle merely to prevent millions of unhappy customers or did he settle because he knew he had infringed on the copyrights? If the injunction had happened, many blackberry users would have been quite unhappy and possibly never bought another product from RIM again. He saved the company by settling and stopping the injunction but we may never know the reason why he settled. It seems as if without settling, RIM would disappear from the US and lose out on much more business. And let’s not forget that back in 2000 RIM was found guilty of willful copyright infringement. It took six years for the company to finally drop the appeals and settle. It sounds as if they knew they were never going to win.

This is not Balsillie’s only blemish with RIM/Blackberry. He was also fined by the Ontario Securities Commission for backdating millions of stock options for a period of 9 years. Backdating stock allows senior executives to profit at the expense of the shareholders. Although there were no criminal charges filed, it still brings into question Balsillie’s business ethics.

Does the NHL want this type of ethics in their league? Do the other owners want to be equated to this type of business man?

Balsillie’s first real attempt to buy and relocate a team was the Penguins in late 2006. Penguin fans felt early on that Balsillie would want to relocate the francise and they were correct in their assumption. Balsillie pulled out of the deal when Gary Bettman, NHL Commissioner, made it known that the sale of the team would not be approved if he planned to move the team. The NHL also wanted to include a clause that would give them the right to take over the team if necessary.

Then in 2007 Balsillie tried once more to obtain a NHL franchise and relocate the team to Canada. This time he used more underhanded tactics to get the Nashville Predators. Balsillie started marketing the team as the Hamilton Predators and started collecting deposits on season tickets through Ticketmaster. These actions, plus the support of Nashville fans, are believed to be reasons why the owner of the Predators reconsidered and sold to another person who would keep the Preds in Nashville.

Now in 2009, Balsillie is attempting to buy the Phoenix Coyotes and relocate them to Hamilton. On May 19^th, a court will decide if Jerry Moyes, current Coyotes owner, had the right to declare bankruptcy and accept Balsillie’s offer. It looks as though the NHL may have the upper hand based on a proxy that Moyes signed back in November, when he accepted a loan from the NHL. This hasn’t stopped Balsillie however, and he has lined up sponsors for the Hamilton Coyotes and a website “Make It Seven” to promote the moving of the Coyotes.

It was also discovered that Balsillie had expressed interest in the Sabres but no actual offer was made. This is interesting because in order for Balsillie to move a team to Hamilton’s Copps Coliseum, he would need the approval of the Buffalo Sabres, since Copps is within Buffalo’s territory.

It seems Balsillie likes to put the cart before the horse. It may have made him billions (while costing him millions) for his business but will it secure him an NHL team? Will it be three strikes and you’re out or third times a charm for Balsillie? We will just have to wait until Tuesday to find out as it all rests in the hands of the Honorable Judge Baum.