The parent company of the Portland Winterhawks filed for Chapter 15 bankruptcy a couple of weeks back amid the cancellation of the WHL season. The parent company had used the team and several other companies to leverage a loan, which ended up being a failed bid in Switzerland on a team and an arena there.
The Western Hockey League was aware that such a loan existed and that if it failed, the team could be lost in the transaction. Bridging Financial Group, which owned the loan being offered, is alleged to have taken control of several companies including the team during the bankruptcy.
Chapter 15 is applied here as Bill Gallacher, who is the team’s owner, lives in Calgary and because there is more than one country involved. Only the companies used by the loan holder to secure the loan are the ones in litigation. To describe the other most often bankruptcies, Chapter 11 is reorganization of assets in one country with the sell off of some parts to gain liquid currency and allow the model to function again. Car manufacturers have done this recently. Chapter 7 is a complete liquidation of all assets where there is no hope of any regrouping of the company. Often in those cases, a small fraction of what is owed will actually be recovered and turned over to the litigants.
To that end, with the bankruptcy, a few things have played out. Neither the owners of the Blazers nor Timbers have expressed any interest in purchasing the club. The WHL is looking for local ownership for the team and seems to have interest. Jon Ryan and Alan Miller who currently own the Portland Pickles Baseball team along with Scott Barchus who is a minority owner have looked at purchasing the team.
The Pickles, which are a wooden bat collegiate team in the West Coast Baseball League, which houses teams as far away as Victoria, BC north to Corvallis south, could be a good fit for the Hawks in that the age groups are pretty similar. Currently, the WCL operates in July and August and so would not compete fan wise either.
The WHL only allows for a ten day window for a franchise to be bankrupt or in receivership before they have the option to pull the franchise. Also at stake would be the lease agreement with Rip City Management LLC as it pertains to the Moda Center and Veterans Memorial Coliseum for playing and housing operations.
It has been understood that Bridging Financing is looking to keep the franchise in Portland as it is not in any financial distress.
The team ownership started with Brian Shaw who moved the team from Edmonton, Alberta to start the 1976-77 season. The team was sold in 2006 to Jack Donovan, John Roberts and Jim Goldsmith, who were three individuals with a minor league baseball background. The team, which had struggled for the past few years years prior, hit the skids. The team was barely reaching 2600 fans on average and had some nights where attendance was at or below 1000. The team was close to folding when Bill Gallacher came along.
Wiping out a massive debt and changing the majority of on ice staff including the hiring of Mike Johnston as Head Coach and Rich Campbell as Athletic Therapist, the team quickly rebounded. The previous two years, which had seen a combined 30 wins, were smashed by the first full season of Johnston’s helm at 44 wins in 2009-10. The team since that time has hit 40 plus wins per season except 2014-15 where they reached 34.
The team had also hit some issues from the WHL as sanctions for what were felt to be unfair practices including family flights after players had been signed, a cell phone for the captain to be in contact with the owner and assistance to players in training for their betterment. The team was fined $200,000, which was raised to $275,000 after there were tweets and posts on the team’s defenses. The financial hit wasn’t the only one. The team had first-round picks taken away for four years and other lower picks for several years.
The WHL is currently still examining what type of season will be available. Currently, borders are closed and 14-day quarantine edicts are still being enforced in some areas, which would be troublesome for sports like the NHL and other hockey leagues, which have teams on both sides of the border.
The WHL handed out its awards virally over the past two weeks with the final announcements being made this week. Seth Jarvis from the Portland Winterhawks was the winner of the Brad Hornung Trophy for being the Most Sportsmanlike Player. Jake Gricius for the Portland Winterhawks was the Runner Up for the Doug Wickenheiser Humanitarian Award. Here are the final WHL Award Winners.
Four Broncos Memorial Trophy
(WHL Player of the Year)
RUNNER UP: Dylan Cozens, Lethbridge Hurricanes
Daryl K. (Doc) Seaman Memorial Trophy
(WHL Scholastic Player of the Year) Presented by CIBC
RUNNER UP: Jakob Brook, Regina Pats
Jim Donlevy Memorial Trophy
(WHL Scholastic Team of the Year)
WHL Top Scorer Presented by Kubota Canada
Bill Hunter Memorial Trophy (WHL Defenceman of the Year)
RUNNER UP: Calen Addison, Lethbridge Hurricanes
Del Wilson Memorial Trophy
(WHL Goaltender of the Year)
RUNNER UP: Jiri Patera, Brandon Wheat Kings
Jim Piggott Memorial Trophy (WHL Rookie of the Year)
RUNNER UP: Logan Stankoven, Kamloops Blazers
Dunc McCallum Memorial Trophy
(WHL Coach of the Year) Presented by McSweeney’s
RUNNER UP: Dennis Williams, Everett Silvertips
Lloyd Saunders Memorial Trophy
(WHL Executive of the Year)
RUNNER UP: Matt Bardsley, Kamloops Blazers
Allen Paradice Memorial Trophy
(WHL Top Official)
WHL Business Award
RUNNER UP: Seattle Thunderbirds
Doug Wickenheiser Memorial Trophy
(WHL Humanitarian of the Year)
RUNNER UP: Jake Gricius, Portland Winterhawk
Brad Hornung Trophy (WHL Most Sportsmanlike Player)
RUNNER UP: Aliaksei Protas, Prince Albert Raiders
WHL Governors Award
RECIPIENT: Sheldon Kennedy
The Canadian Hockey League announced this week that it has settled a long standing lawsuit with players from 2012 to 2018. The $30 million settlement is just 16% of what was originally being sought.
“This settlement does not mean that we agree with the plaintiffs,” the CHL said in an open letter. “It means that we wanted to end the lawsuits so we could continue to focus on being the best development league in hockey.”
The league insurance will pay up to half of the judgement and the teams will then be responsible for $250,000 each. There is some confusion in that Charney Lawyers, which filed the class action suit has stated that US Teams are not part of the settlement. There are currently six US-based teams in the CHL. If one thinks the people will get rich off this, expect only a few people to receive more than $10,000. Most of the areas where the CHL is at are under some type of legislation which exempts these players are employees which the suit claimed they were.
Now, going forward we will see what transpires. As of now, Oregon has not agreed to legislation on the matter.