An Interesting Story from 2009 regarding the Kings Move to Anaheim

I heard a very interesting story yesterday regarding the Kings move to Anaheim.  This is a story that is rather frightful regarding the state of professional sports franchises as ethical and moral businesses in the United States. 

A friend of mine from the Sacramento area was attending a large extravagant birthday party for a relative in the LA area two years ago (2009) and met a guy at the party who happened to work in the upper levels of the Anaheim Ducks organization.  The drinks were flowing.  Inhibitions were perhaps a bit down.  The Ducks executive said  "you know your Sacramento Kings are coming to Anaheim."  My friend said  "No they aren't.  They have an arena deal they are working on and the Kings have been really successful in Sacramento until recently when the team has been horrible, the recession hit and they lost money (but not a lot of money) for really the first time since the Maloofs bought the team." 

The executive said, "No you don't understand.  "It is a done deal.  The Kings are coming to Anaheim.  The Maloofs have never wanted to be in Sacramento.  They wanted to move to Las Vegas before but they realized that will never happen with the poor economy in Las Vegas and no arena there, in addition to David Stern's objection to potential perceptions of gambling influences.   The Maloofs are friends with the Ducks owner Henry Samueli who is a billionaire."  He then preceeded to rattle off 3 or 4 business ventures in which the Maloofs are currently involved with Samueli.  "He said the details of the TV deal still needs to be worked out but David Stern has already agreed for this to happen.  The potential TV deal alone makes the deal make sense financially to the Maloofs.  The NBA is playing lip service to this arena deal in Sacramento but they don't think it has a prayer of actually happening and in fact they will make sure it doesn't happen."  "In addition, David Stern is a shoestring relative of Henry Samueli"s by marriage and they are very good friends.  David Stern wants Henry Samueli in the NBA."  "David Stern used to like Sacramento but he is frustrated about your arena situation and he thinks the only way Sacramento ever builds an arena is to lose a team. This move has already been decided."  The guy then went on to comment about problems with the New Orleans Hornets franchise.  He said it looks like you might get the Hornets.  The Maloofs want out of Sacramento and want to be partners with Samueli.  Anaheim is also closer to Las Vegas.  You will lose the Kings and if you are lucky and you get an arena built you may get the Hornets." 

My friend pondered this story for a long time but to his amazement it all seems to be transpiring precisely as forecasted in 2009 by the Samueli employee.  

Think about the facts and questions concerning the events surrounding this move:

1) The Maloofs had no interest in the 2006 public referendum on public financing passing and all but sabatoged it with their Carl's Junior commericial and statements that they didnt support the deal prior to election day;

2) the Maloofs have never cooperated fully with any arena development plan; any arena built in Sacramento that the Maloofs didnt own, would necessitate a lease...and a lease would make afuture move all the more difficult financially and legally;

3) Most recently the NBA choose to pursue perhaps the most complex plan for an arena in Sacramento at the Cal Expo site that involved a land swap deal...a plan many real estate developers were skeptical about from the early stages and considered too complex and doomed to failure;

4) the Maloofs never made an ultimatum or drew a line in the sand that they were gone if an arena didn't get built in Sacramento...Why? They didnt want to give Sacramento officials time and the sense of urgency to mobilize forces and get a plan in place if it was apparent the region was in imminent risk of losing the Kings.  Instead the Maloofs worked in a clandestine fashion that was the only way their Anaheim plan would work; a viable arena plan in Sacramento would  make it less likely that NBA owners would support a relocation of the Kings to another city;

5) Think about the timing of this Kings move to Anaheim in relation to the Lakers recently signing their new cable TV deal; this deal opened up additional TV contract possibilities for a third team in the LA area. How long do you think Samueli and the Maloofs knew about these Laker TV negotiations?

6) Why is it well-documented that the Maloofs have completely refused to talk to city officials from other areas such as Kansas City? Because they have been Anaheim-bound for a long-time;

7) Think about the lack of cooperation given by the Maloofs to the Taylor / ICON development group for a new arena deal; a viable plan in Sacramento might impact the relocation vote of the NBA owners;

8) Why would the Kings hire Bill Walton in the summer of 2010 as a part-time radio and TV analyst for the Sacramento Kings? Do you honestly believe the investment in bringing Walton on was to excite the Sacramento fan base about the team? Bill Walton is an icon in Southern California.  Anaheim is a short distance from his southern california home.  I would wager that Bill Walton's role with the Anaheim Royals will increase as soon as the move to Anaheim is completed;. 

9) Ever think about the throw back "Royals" uniforms the Kings team sported in February and March of 2011?  This provided some nice photo opportunities for future Anaheim marketing.  Remember that the Kings organization keeps reminding us that it was decided far earlier in the 2010 year to wear those throw back uniforms.  Of course it was.  Why not wear throw back powder blue or black Kings uniforms? Because these photographs and videos could be used for Anaheim marketing.

10) When did David Stern tell Sacramento major Kevin Johnson that he would not stand in the way of the Maloofs moving to Anaheim; wasnt it sometime back in 2010?

11) Why was the gag order about the possible move to Anaheim placed on the Maloof brothers by Davis Stern and the NBA?  Wasn't  the fine $1 million dollars by report? The NBA wants this move to happen without the Maloofs saying someting stupid that would infuriate the public or anger NBA owners; 

12) What was the rationale for the granted extension to after the current season granted to the Maloofs?  Stern didnt have to allow an appeal for the extra time if he didnt want the move to happen.  This obviously salvaged the season financially for the Maloofs and avoided an ugly PR predicament for the NBA.  Are such extensions to timelines for moves common place in the NBA?  There is obviously a high degree of cooperation coming from the NBA regarding this move to Anaheim;

13) Why did the Anaheim City Council move up their meeting to vote on a $75 million loan to the Maloofs before the Maloofs had even asked for permission to move their franchise? Were the Maloofs getting nervous about the time table vis a vis the setting of the relocation price tag by the NBA and demanded an earlier vote?  The price tag for this relocation has likely already been established by Stern and others in the NBA.  The LA Lakers owner Jerry Buss is viewed as a large market rich owner with a multi-billion dollar TV contract.  Do you think NBA owners will sympathize with him?  Buss and Sterling of the Clippers will have no impact on the ultimate relocation price tag. This is analagous to revenue sharing in their eyes. The NBA wants this move to happen.  The price tag for relocation wlll not pull the plug on this deal.  An increase in the relocation fee from $30 million to $50 million will be largely be symbolic.  Do you think the Maloofs and Samueli would leave this critical issue of the relocation fee to chance?

14) Why would Sacramento Mayor Kevin Johnson be granted the opportunity on April 14th to speak to the NBA Executive Committee on "how Sacramento should be first in line for the next NBA franchise that becomes available?  Why wouldnt he be fighting to the end to keep the Kings in Sacramento?  Has he been told by David Stern to not interfere with this move if you ever want another NBA franchise agian for your arena deficient city?

15) Why did the Maloofs do absolutely nothing earlier this year to prepare for Sacramento season ticket renewals for next season?  They usually start this process in January and get early committments in February.  Why are Anaheim Ducks season ticket holders already being given preference for seat location in Anaheim for the future Royals games in preference to Sacramento Kings fans that have held season tickets with the organization for over 20 years?  Why? Because this move is a done deal which has involved Samueli and the Maloofs for a long long time.

Stories are mere stories and unnamed sources are just that...unnamed.  However a logical human being looking at what has transpired with this Sacramento to Anaheim move can only conclude the following:  The Maloofs were only willing to put their hearts into Sacramento if they could totally control a publically funded arena, they had made a decision long ago to move the franchise, and they waited until a period in time when economic conditions were such and attendance had been driven down by a poor product on the floor so they could have the support by NBA owners to move the team to a location to their likeing.  David Stern and the NBA conspired with the Maloofs to provide only luke warm support or even sabatoge arena plans in Sacramento.  This was necessary to gain support of NBA owners for a move to Anaheim -- a move that would result in Henry Samueli (a billionaire friend of David Stern 's) being brought in to the fold of owners. 

The price tag set by the NBA for the Sacramento to Anaheim relocation will perhaps be the ultimate proof of what has transpired since 2009 or before between the Maloofs, Samueli, and the NBA.  Do you really think the price tag for relocation will be $30 million with LA owners Buss and Sterling both affected?  Do you think it will be $80 or $100 million?This is money the Maloofs don't have and money Samueli will not commit without a majority ownership stake in the team?  Just remember this plan has been in the works for a long time and the NBA wants it to happen.  Rather the logical mind would submit that a well conceived plan by the NBA, Henry Samueli and the Maloofs would logically culminate in a relocation fee being set at around $50 million...the precise amount of the Anaheim loan not committed to Honda Center upgrades.  This deal is done.  The Anaheim City council was given some idea what the relocation fee will be.  A high relocation price tag will not be allowed by the NBA to derail this deal.  The Maloofs will of course fulfill their commitments of their loan to Sacramento by handing over Arco arena to the City of Sacramento and a $25 million stake in the team that Henry Samueli of Anaheim graciously will agree to buy from the city of Sacramento. To the Maloofs it is almost a symbolic gesture to leave  Sacramento with the keys to Power Balance arena.  To the Maloofs this is a simple and complete pay back and a fulfillment of their legal commitments, not a default.  Thats simply how loan collateral works in the business world. 

If we had a new arena, all of this would of course not be happening. But the Maloofs and the NBA have not made genuine attempts to make a viable arena deal happen in Sacramento easy or even likely. The Maloofs have not spent any money to make this team better for the past 5 seasons.   In the end, Sacramento, a small market community, which hosted the once David Stern proclaimed "model franchise of the NBA" and which has enthusiastically embraced it's team for decades is the ultimate loser. 

As for the fate of the New Orleans Hornets and the Sacramnto region the issues are complex.  The league wide ownership group will not sell the Hornets until after the collective bargaining agreement is settled.  A potential bidderr for the Hornets is Larry Ellison who remains a wild card.  If he buys the Hornets and moves them to San Jose a third NBA franchise does not likely come to Northern California.  The world through the tinted glasses of David Stern sees this whole process as merely a re-equilibration of market forces-- a simple move from Sacramento to San Jose keeping two teams in Northern California (San Jose being the city with an arena) and a replacement of New Orleans (an historically troubled franchise) with Anaheim and billionaire Henry Samueli.  Perhaps his ultimate hope is that the Maloofs are forced to sell the Anaheim Royals to his friend Samueli after the team has moved to Anaheim.  This will create the ideal situation of local ownership.  This will agian be determined by both the success of the Anaheim Royals and the economy of Las Vegas.  Henry Samueli would have far more obstacles buying the Kings of Sacramento and enduring a year of ownership in Sacramento while tryng to get NBA owners to agree to a reasonable price tag for relocation while Sacramento mobilizes for a new arena plan. Henry Samueli is not that stupid. The extent to which David Stern worked to escalate discussions between his friend Samueli and the Maloofs with his talk of league contraction in October of 2010 is perhaps a matter of interesting conjecture.  At this point Davis Stern likely sees the Maloofs as being "on their own" once this move to Anaheim occurs.  This is again a simple matter of economics.  But there will likely be no tears shed by David Stern and the NBA if billionaire Henry Samueli ultimately becomes the owners of the Anaheim Royals in the event that the Maloofs eventually fall in to bankruptcy.

(This is a FanPost from a member of the Sactown Royalty community. The views expressed come from the member, and not Sactown Royalty staff.)

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