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Sonics Trial Blog

Seattle Times reporters Percy Allen, Jim Brunner and Danny O'Neil are filing updates from the courthouse throughout the day.

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June 20, 2008 4:13 PM

Licata still thinks KeyArena could be profitable minus the Sonics

Posted by Percy Allen

Sonics attorney Brad Keller questions Seattle City Councilmember Nick Licata.

Licata believed Mayor Greg Nickels had not kept the City Council in the loop on KeyArena renovations, urged that no action be taken until the effort could be thoroughly vetted, in effect, helping block the vote for the state funding in 2006.

Keller introduced Exhibit 522, an e-mail from Licata to state legislators. In the e-mail, he said a poll showed 80 percent of Seattle voters do not support using a tax for the Sonics. He also cited a KING 5 TV poll, in which 65 percent of those polled said they did not support using tax dollars for the Sonics. And another poll indicated only 7 percent of the respondents wanted to keep the Sonics.

Keller introduced Exhibit 520, a Feb. 8, 2006 e-mail from Licata to state legislators. In the email, he wrote: "The welfare of the Sonics should not be linked to the welfare of the Seattle Center."

Licata wrote in the February 2006 e-mail that the city hired consultants that denied the team's assertion that KeyArena would become a "white elephant." The consultants said KeyArena could turn a profit. The consultants said the city needed to invest $20 million in the building.

In the e-mail, Licata wrote: "The net revenue to the Seattle Center is only $5,000 per game whereas it is 10 times that from concerts."

Keller asked if Licata still believes KeyArena could be profitable without the Sonics.

"That is my lone point of view," Licata said.

In his testimony, Licata said it's difficult to calculate the transfer of disposable income. Transfer of disposable income is the theory that if people don't spend their money on the Sonics, then they will spend it on something else in Seattle. Licata said economists will inflate or de-emphasize statistics to support their argument.

When pushed on the topic, Licata said he believes the Sonics have a limited economic impact on Seattle.

Lawrence introduced Exhibit 525, a review for the City Council that states: "There is no empirical evidence showing that major league teams and their stadiums and arenas are effective drivers of local and regional economies."

Lawrence asked about Initiative 91, which Seattle voters approved in November 2006. The measure said any public funding of a sports facility should bring a fair return to the public investment. Licata said he had input in its creation.

Lawrence asked if the initiative was proposed because of the Sonics' efforts to get public funding. Licata said no.

Lawrence introduced Exhibit 518, a document in which Licata wrote: "Yes on 91 says there are more important things than a new stadium for wealthy out of state Sonics owners such as keeping schools open, affordable housing, health care, lower taxes, roads and transit, and real economic development."

Licata ackowledged the initiative's proposal was, in part, directed at the Sonics' public-funding effort.

At 4:02 p.m., Judge Marsha Pechman interrupted the questioning. Licata will return to the stand Thursday at 9 a.m. Court will not be in session Monday through Wednesday.










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June 20, 2008 3:28 PM

Griffin says goal was to keep team at Seattle Center

Posted by Percy Allen

The late afternoon session began with Seattle developer Matt Griffin on the witness stand fielding questions from Seattle attorney Paul Lawrence.

Earlier in the day, Griffin said a group that included K&L Gates attorney Slade Gorton adopted a plan to force Sonics owner Clay Bennett to sell the team. Under cross-examination, Griffin said forcing Bennett to sell was not the only option. In a document, he referred to Microsoft Steve Ballmer, who was going to buy the team and fund a portion of KeyArena renovations, as "reluctantant white knight."

Griffin said former Safeco president Mike McGavick authored the "Sonics Challenge: Why a Poisoned Well Affords a Unique Opportunity" power point presentation.

Lawrence examined Exhibit 576, an e-mail from Gorton to Griffin and others.

Griffin said he was willing to buy the Sonics along with Ballmer, wireless magnate John Stanton and Costco CEO Jim Sinegal. He said the group had three options. 1.) Bennett and his group would stay at KeyArena. 2.) Bennett would sell the Sonics. 3.) Another team would move to KeyArena.

Griffin said his group committed $150 million toward a $300 million KeyArena renovation.

Griffin said he never met with Mayor Greg Nickels about the city's legal plans.

Lawrence asked: "Did you and Mr. Ballmer want to bleed Clay Bennett or did you want to get a team in Seattle Center?"

"We clearly wanted a team in Seattle Center," Griffin said.

At 3:26 p.m. Lawrence concluded.

Under redirect, Sonics attorney Brad Keller asked what efforts Griffin made to get another NBA team.

"We didn't think we could get another NBA team without a renovated KeyArena," Griffin said.

Lawrence asked if Griffin had ever spoke to Bennett about KeyArena.

"No," Griffin said.

At 3:29 p.m., Griffin was excused and City Councilmember Nick Licata was being questioned by Keller.


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June 20, 2008 3:03 PM

Walker had predicted an ugly trial over Sonics' relocation

Posted by Percy Allen

Sonics attorney Brad Keller closed out his questioning of developer Matt Griffin by going over the efforts during the last legislative session to fund a $300 million renovation of KeyArena.

That proposal was a last-ditch effort to get an acceptable arena plan together before the NBA voted to approve the Sonics' relocation to Oklahoma City. Griffin was working with Microsoft CEO Steve Ballmer and other businessmen, who said they'd pay half the cost of the project.

Keller pointed to an e-mail by Wally Walker, former Sonics president, to Griffin in March 2008. Walker warned in that e-mail that politicians needed to get something done this year and not put off a decision. (Legislators in fact did put off the decision, deciding to form a task force for next year.)

Walker wrote "the gig may be up for good if we don't succeed now." Absent a funded arena, he predicted a nasty trial over the Sonics' relocation.

"Think of how ugly the trial will be, how ugly the Sonics' departure will be," Walker wrote.

Keller concluded his direct examination and Seattle attorney Paul Lawrence began cross examination. Lawrence asked Griffin what his goals were in getting involved with the KeyArena plan.

Griffin said he and Ballmer wanted to maintain the health of KeyArena and preserve NBA basketball for the city.

"If it was possible for it to be the Sonics that would be great, but if it was another NBA team that would satisfy our objectives as well," Griffin said.

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June 20, 2008 2:02 PM

Developer Matt Griffin testifies about effort to buy Sonics

Posted by Jim Brunner

Lunch recess is over, with Seattle developer Matt Griffin on the stand.

Sonics lead attorney Brad Keller is questioning Griffin about his involvement with Microsoft CEO Steve Ballmer and others who were trying to purchase the Sonics.

Keller is trying to establish that the city of Seattle was a party to a "Machiavellian plan" to force Sonics owner Clay Bennett into selling the team.

Noting that part of that plan was to make Bennett lose money at KeyArena, Keller asked Griffin, "you had no ability to lock the PBC (Bennett's group) into losses at KeyArena, did you?"

Griffin responded: "Not that I know of." He agreed with Keller that only the city could create those financial losses (by holding the team to its lease.)

Keller also displayed e-mails in which Griffin and others discussed putting Bennett "in a box."

Keller asked whether "in a box" meant forcing Bennett to sell the team. Griffin resisted that, saying the goal was to make Bennett do something other than relocating. "I would have been happy if he'd stayed," Griffin said.

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June 20, 2008 12:22 PM

City concedes nothing; we correct earlier post

Posted by Jim Brunner

Seattle is not conceding anything about their chances in the ongoing Sonics trial.

My apologies to the city's lead attorney Paul Lawrence and the city's legal team for an earlier blog item.

The city's lead attorney, Paul Lawrence, did make reference to an "appeal" after Judge Marsha Pechman sustained an objection.

But Lawrence said in an interview that he does that in any trial in which either side might appeal the final decision -- a likely outcome in this case. "It's routine in cases," Lawrence said.

Lawyers need to make sure their objections are recorded so that an appeals court has a written record.

Former Sonics President Wally Walker's testimony just concluded, with Lawrence trying to show the city was not involved in a "Machiavellian plan" to force a team sale.

Referring to the PowerPoint presentation that talked about inflicting losses on Clay Bennett's group, Walker testified that the document had been written by Mike McGavick, a former aide to Sen. Slade Gorton.

"We didn't have anything close to a plan. These were ideas to hopefully stimulate interest," Walker said.

Seattle developer Matt Griffin took the stand just before the trial paused for the lunch recess.

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June 20, 2008 11:04 AM

Is the city thinking ahead to appeal?

Posted by Jim Brunner


The city has been frustrated by Judge Marsha Pechman, who has overruled numerous objections this morning by Paul Lawrence during the aggressive questioning of former Sonics President Wally Walker. At one point she also told Lawrence he was reading court rules incorrectly.

Pechman cut off Lawrence when he was asking Walker about his basketball career and connection with the Sonics, including Walker's presence on the 1979 Sonics championship team.

Pechman said she'd seen Walker play and didn't need to hear more about his NBA career.

"I appreciate that your honor, but we do have to make a record for our appeal," Lawrence said.

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June 20, 2008 10:20 AM

The "Machiavellian plan" revealed? The Sonics like to think so

Posted by Jim Brunner

Sonics attorney Paul Taylor has been trying to expose former team President Wally Walker's role in a "Machiavellian plan" -- in which he says the city participated -- to force Clay Bennett to sell the team to local owners led by Microsoft CEO Steve Ballmer.

Taylor revealed an until-now secret document called "The Sonics Challenge: Why a Poisoned Well Affords a Unique Opportunity." The document was used at an October 2007 meeting that included Walker, Ballmer, former Safeco CEO Mike McGavick, and former U.S. Sen. Slade Gorton. (This document had been sealed up until now.)

"For the best likely outcome, two things have to happen next: Oklahomans have to be willing to sell and the public folks have to do the right thing," the plan said.

It continued: "...the critical path is to separate the NBA from the Oklahomans while increasing the exposure for each."

And it added: "So it's a pincer movement, increasing the Oklahomans' cost in an unpleasant environment while increasing the league's belief that an alternative solution gains it a good new owner and keeps it in a desirable location."

Seattle's lead attorney Paul Lawrence objected to the admission of this document and related ones, arguing there was no proof that Walker was working for the city.

But Judge Pechman Marsha rejected that, pointing to another memo, which Walker signed, that said he began working as a consultant for the city on saving the Sonics as of September 2007.

Lawrence asked, "Can I respond, your honor?"

"No, you've made your argument," Pechman said.

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June 20, 2008 9:17 AM

Former Sonics President Wally Walker takes the stand

Posted by Jim Brunner


Court has resumed this morning with the Sonics calling Wally Walker, former team President and part-owner of the Sonics.

Sonics attorney Paul Taylor asked Walker about the inadequacies of KeyArena.

Taylor asked whether Walker knew KeyArena was an inadequate NBA facility as far back as 2004.

"I believe I said publicly it was a challenging arena at that time, yes."

Taylor asked: "The lease was not competitive with other NBA leases, right?"

Walker: "Yes."

At 9:08 a.m. Taylor showed Walker a memo of talking points written by K&L Gates attorney Gerry Johnson, who was then working for the Sonics.

"The current lease between the city and the Sonics does not work for either party," Johnson wrote in the memo. Further, the memo said that due to ongoing financial losses, owners would have to consider selling the team, or even moving outside the region.

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Browse the archives

July 2008

June 2008

Recent stories

Sonics attorneys focus on city's "poisoned well" plan
Bennett says Sonics could lose $60 million if forced to stay in Seattle 2 more years
Sonics CEO: Fans are apathetic
Clay's excuses sound as contrived as his arena plan
On the hot seat: Sonics' attorney trips up Nickels
Attorneys in Sonics case described as tenacious, polite
This judge will decide the fate of the Sonics
Seattle vs. Sonics: Trial starts next week, if there's no settlement
Take a closer look at the Sonics case
More revealing Sonics e-mails emerge
OKC officials inform Schultz they expect Sonics to relocate, no matter who owns team
Sonics e-mail hints at NBA's concern over breach of promise
Howard Schultz suit adds fuel to e-mail fire
NBA owners approve Sonics' move, but legal fight continues in Seattle
E-mails reveal Sonics owners intended to bolt from Seattle
Oklahoma House passes tax package designed to help lure Sonics

Documents

2007 "Poisoned Well" document (PDF)
Ward: "Are we doomed to have another lameduck season in Seattle?" (PDF)
Bennett's e-mail to Stern: "You are just one of my favorite people on earth" (PDF)
Clay Bennett and Sonics' court filing (PDF)

Multimedia

Gallery | Seattle SuperSonics: Lasting memories
Gallery | Bittersweet night for Sonics fans
Gallery | Sonics through the years
Gallery | 25th anniversary of Sonics world championship
Gallery | End of a Season, End of a Franchise?
Sports fan "Big Lo" seeks answers from Howard Schultz

Fans weigh in about the state of the Sonics
Cartoon | Schultz jumps into action
Talk about the team in the Sonics forum

Other links

Trial coverage from www.newok.com
ESPN.com | Hope (still) springs in Seattle