Glen Taylor has subpoenaed the NBA in the ongoing fight over ownership of the Minnesota Timberwolves, according to multiple people familiar with the matter, a rare move that could potentially expose private league communications and financial information to a more public audience.
Taylor, the current control owner of the Timberwolves, is locked in a legal battle with Marc Lore and Alex Rodriguez over the NBA franchise. Lore and Rodriguez had a purchase agreement to buy the team from Taylor in stages for about $1.5 billion, but the deal fell apart earlier this year right before they could close on the control stake. Taylor claims they violated the agreement and the transaction is void; Lore and Rodriguez claim there was no violation and the deal should be executed.
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A contractually obligated mediation session four months ago failed to reach a resolution, and the two sides are now heading toward a binding arbitration in November. Often used by pro leagues to keep matters away from public viewing, arbitration is a dispute resolute resolution process conducted in private and outside the court system, where filings are generally public and accessible to media. As part of that process, Taylor’s legal team issued a subpoena to the league a few months ago seeking communications and information, said the people, who were granted anonymity because the details are private.
A representative for Taylor declined to comment. A representative for the NBA didn’t immediately respond to a request for comment.
The league has publicly distanced itself from the Timberwolves situation. Asked about the legal dispute following NBA board of governors meetings in April, commissioner Adam Silver said “there is no role for the league” in the pre-set mediation and arbitration process, and that the dispute “will be resolved independent of the league office.”
He reiterated that stance this week. “It’s pencils down at the league office,” he told reporters. “Depending on the outcome, only then would the league continue a vetting process for ownership.”
Subpoenas are orders to provide sworn testimony in person or through written remarks, or to produce copies or inspection of certain documents (including emails, texts and social media messages). Those issued in arbitrations are more susceptible to challenge than those issued in litigation, since arbitrations are not judicial proceedings.
The NBA is not a party to the arbitration itself, but the league has a direct stake in the arbitration’s outcome given that the Timberwolves are an NBA franchise. The NBA board of governors approves franchise ownership, meaning the league will have final say over the Timberwolves’ ownership. Like the 29 other NBA franchises, Minnesota contractually consents to NBA rules specified in the league constitution, bylaws and other documents. The NBA might not oppose a role in an arbitration in which the league has a vested stake.
It’s rare for a major professional league to be subpoenaed in a legal proceeding like this—though almost everything about the Timberwolves sale saga is abnormal—and there are plenty of reasons why it might not be a preferred outcome.
The risk for the NBA with a subpoena is that it could compel disclosure of league communications regarding the Timberwolves that the league would prefer to keep confidential. The NBA might also worry about discussions regarding ownership in general, and revenue and contracts could be subject to disclosure in a subpoena. Although the Timberwolves arbitration is supposed to be confidential, there have already been leaks to media about it.
Shortly after Taylor announced that the sale was off earlier this year, Lore and Rodriguez said they were awaiting NBA approval on signed financial commitment from their backers. That status, they claimed, should have triggered an automatic 90-day extension according to the terms of the purchase agreement.
Taylor has a different interpretation of the contractual language. He said that while the buyers could have been granted a “limited extension” under specific circumstances, those circumstances did not occur.
As the ownership saga has unfolded, Lore and Rodriguez have continued to bolster their financial position. In June, billionaire Mike Bloomberg joined their group. Sportico reported at the time that the group intended to put all the money needed for their final two payments, more than $900 million total, in escrow prior to arbitration.
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