Lawyers win in A-League’s new stoush

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    The A-League’s latest crisis is not just another battle of wills amongst soccer’s billionaire brigade. Men like Frank Lowy, Clive Palmer and Nathan Tinkler are used to getting their own way.

    Palmer blew $18 million on his failed Gold Coast venture and clashed so openly with Lowy’s Football Federation Australia that FFA booted him out.

    Tinkler has spent $12 million on Newcastle and wants out, too, but in his case the FFA wants to make him stay. Why?

    FFA desperately needs 10 teams to get the best possible TV rights deal before the start of next season.

    Gold Coast’s demise suddenly shrunk the league back to nine.

    This may help to explain why a western Sydney team, which failed to get off the ground in the form of Sydney Rovers, has since been fast-tracked into next season’s competition.

    The team doesn’t have a name, any players, a coach, a CEO or a ground, but its sudden theoretical existence took the numbers back to 10.

    It may also explain why FFA will bankroll it, at least for the first two or three years, despite declaring after North Queensland Fury folded last year that it was not in the business of owning football clubs, despite Lowy’s exasperated recent comment that FFA was “not a bloody bank”.

    And now comes Tinkler’s bombshell announcement that he wants to hand back his licence.

    FFA cannot afford to lose another club. It is insisting that he honours his 10-year agreement to 2020.

    Will it be able to force him? Will new owners be found? Can FFA find funds to try to temporarily bankroll Newcastle, as it is with western Sydney? Or will it be back to nine teams?

    Lawyers are already wigging up, as they did when Palmer and Lowy came to loggerheads.

    Significantly, Tinkler will retain his involvement with Newcastle’s NRL team the Knights.

    His stoush with FFA comes at a time when soccer and AFL are both attempting to claim a slice of the critical western Sydney area previously owned by rugby league.

    The ultimate goal, though no-one openly admits it, is domination of the highly competitive football market.

    The AFL’s 18th team, the Greater Western Sydney Giants, spearheads a clinical AFL expansion which has been allowed a decade and tens of million dollars to work.

    The NRL is responding with its own war chest and its own promotional ideas.

    The last thing the A-League needs as it prepares to do battle with these two giants in western Sydney is a major problem in another area like Newcastle.

    The A-League’s western Sydney franchise will provide a crucial bargaining chip when the FFA renegotiate their television rights later this year.

    It is hoping to snare a massive deal so that it can provide much-needed funds to the financially struggling A-League clubs, which have combined losses of $27 million this season.

    When the A-League was being created it was a hard sell and no-one was prepared to go near Fox Sport’s $18 million over seven years.

    But FFA now wants to net a deal worth at least $30 million a year that includes a free-to-air component.

    FFA might also profit from examining the AFL, whose clubs are all member-owned except the latest two expansion teams.

    It’s a model that clearly works, and is less susceptible to catastrophes that affect private owners, such as GFCs.

    Timeline of the troubled A-League competition:
    2005 – A-League begins with eight foundation clubs, including Auckland-based New Zealand Knights (formerly Football Kingz in the NSL).
    December, 2006 – New Zealand Knights’ licence revoked by Football Federation Australia after poor on-field performances and low attendances
    March, 2007 – Wellington Phoenix selected to replace Knights in A-League ahead of Townsville-based bid
    May, 2009 – FFA take control of Adelaide United after businessman Nick Bianco relinquishes ownership of the club.
    August, 2009 – North Queensland and Gold Coast United enter competition as A-League expands to 10 clubs
    September, 2009 – FFA gives green light to a bid for a western Sydney franchise for inclusion in the 2011/12 A-League season known as Sydney Rovers
    August, 2010 – Melbourne Heart enter competition
    September, 2010 – Newcastle Jets owner Con Constantine’s licence handed back due to the club’s dire financial situation. Nathan Tinkler’s Hunter Sports Group agree to take over
    November, 2010 – Consortium headed by businessman Robert Gerard takes control of Adelaide United
    December, 2010 – FFA announce Sydney Rovers will not enter the competition as planned, due to the bid consortium’s lack of funds
    March, 2011 – North Queensland Fury’s licence revoked due to financial reasons
    March, 2011 – FFA takes control of financially troubled Brisbane Roar
    September, 2011 – Wellington Phoenix changes ownership due to owner Terry Serepisos’ financial difficulties
    October 2011 – Indonesian mining company The Bakrie Group buy controlling share of Brisbane Roar
    November, 2011 – Central Coast Mariners reveal financial difficulty with short-term cash flow problems resulting in delay of payments to staff and players
    February, 2012 – FFA revokes Clive Palmer’s Gold Coast United licence citing a breach of the league’s regulations and agrees to pay players’ wages for remainder of the season
    March, 2012 – Clive Palmer forms independent organisation known as Football Australia, aimed at keeping FFA accountable for their administration of the game
    April, 2012 – FFA announces it will bankroll a new western Sydney franchise to enter the competition in 2012/13
    April, 2012 – FFA announce Gold Coast United will not take part in 2012/13 competition
    April, 2012 – Hunter Sports Group announce intention to hand back Newcastle Jets licence

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    The Crowd Says (8)

    • April 11th 2012 @ 8:51am
      Titus said | April 11th 2012 @ 8:51am | ! Report

      Seek damages from Tinkler, use the money to support NJ while a community ownership model is established. No point keeping on people who will so readily damage the game.

      FFA needs to allow teams to seek their own sponsors, and to organise and keep profits from finals matches. If you can’t offer them that, then don’t charge them a bogus business licence.

    • Roar Guru

      April 11th 2012 @ 9:18am
      Fussball ist unser leben said | April 11th 2012 @ 9:18am | ! Report

      Mike Cockerill in the SMH has reported that $100 million is the underlying figure the FFA has attached to an impending injunction against HSG for wrongful termination of contract – for annual licence fees owed by HSG until 30 June 2020, costs associated with running NUJ until 30 June 2020 and damage done to the image of the A-League.

      Quantifying “damage done to the image of the HAL” may be subject to alternative valuations but other damage claims are easily quantifiable and, from what I’ve read, amounts to $70-80m.

      Additionally, if FFA is successful in bringing a damages claim against HSG, it’s likely they will also make a claim against HSG for legal costs.

    • April 11th 2012 @ 9:28am
      Simmo said | April 11th 2012 @ 9:28am | ! Report

      “FFA might also profit from examining the AFL, whose clubs are all member-owned except the latest two expansion teams.”

      So where exactly does the money come from to start a membership-based club? It takes at least $5m to get an A-League club up and running before it gets its first punters through the gates. Who’s paying the bills up to that point?

      Abd when the new club is running at a deficit for at least its first 5 years, who’s making up the budget deficit?

    • April 11th 2012 @ 9:35am
      Jack Russell said | April 11th 2012 @ 9:35am | ! Report

      Both GWS and the Gold Coast Suns are member owned as well. Only West Coast and Fremantle are not, although both are not for profit.

      • Roar Guru

        April 11th 2012 @ 9:51am
        Fussball ist unser leben said | April 11th 2012 @ 9:51am | ! Report

        What does that mean, Jack Russell? What does “member-owned” mean in the AFL?

        a) What are the ownership rights – legal and/or equitable – that attaches to membership of the GWS & Suns?
        (Note: The AFL – not the individual 18 clubs- owns the rights to each club’s name, each club’s emblem and each club’s trademarks, etc.)

        b) If the club is terminated & all the assets are sold – who receives the money that remains after all creditors are paid? Are you suggesting Season Ticket holders will receive some money?

        c) Does every Member have ownership rights?
        * Junior members? Student/Concession members? Away members? Limited game members?

        d) What happens if a “member-owned” club gets ZERO members in a given year? Does that mean the club has no owners?

        The concept that AFL clubs are “member owned” is the one of the many myths attached to sport in Australia.

        • April 11th 2012 @ 7:40pm
          Jack Russell said | April 11th 2012 @ 7:40pm | ! Report

          In the AFL, most clubs are corporations limited by guarantee. It means, in layman’s terms, that they don’t have shareholders because they’re owned by their members. If you want to learn more, go and read a book on corporations law.

          The specific rules surrounding who is a member and where the money goes are governed by the documents of each club. But it’s generally a requirement to be non-profit for tax purposes that you need a clause preventing any distributions to members. So no, members would not receive anything on winding up. If you want to know more about that or any other rights of members, ask each club for a copy of their constitution and you should find your answer.

          Why you say this is a myth i’m not sure (probably driven by jealousy), because that AFL clubs are member owned is a simple fact that a very quick search of the ASIC database (which you are able to do on their website) can reveal to you.

    • April 11th 2012 @ 5:24pm
      Titus said | April 11th 2012 @ 5:24pm | ! Report

    • November 29th 2013 @ 3:52am
      debby - said | November 29th 2013 @ 3:52am | ! Report

      There are so many steps to pass until the case you have is finished. Hiring a professional agency will help you yo get the right thing to do and opportunities to be active to solve your case.

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