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Monday, November 26, 2007

Throw Down in Fargo

An interesting development in Fargo occurred today, as lawyers representing the Fargo-Moorhead Jets sent the below letter to Ron DeGregario, Dan Esdale, and David Ogrean of USA Hockey.
November 26, 2007

Re: FM Junior A Hockey, LLC, dba Fargo-Moorhead Jets;
North American Hockey League
Our File No. 8257.1


We represent FM Junior A Hockey, LLC which operates the Fargo-Moorhead Jets, a franchise in the North American Hockey League. We have received Dan Esdale's letter in response to our letters dated October 1, 2007 and October 22, 2007, concerning the plans of USA Hockey, Inc. to allow the United States Hockey League to operate a new Tier I Junior A hockey team in Fargo, North Dakota. We formally challenge the action of USA Hockey, Inc. and request investigation and resolution of this matter in accordance with the Bylaws.

We have the following objections:
1. Article XIV, Standard for Junior classification, of the Rules and Regulations of USA Hockey provides that "[a]ny new member seeking membership within the Tier I league shall notify USA Hockey at the Annual Congress one full year in advance of the anticipated date that the team would be ready to compete." This requirement was not adhered to, as reflected by the minutes of the 2007 Annual Meeting in which there is no statement of any notification of the anticipated competition of the new Fargo team. We maintain that the communications cited in Mr. Esdale's letter are not compliant with the above article.

2. The proposed new Fargo team has not been certified and approved for participation pursuant to the Rules and Regulations, and was permitted to participate in the Futures Draft in October 2007 and to represent itself as a new member team.

3. USA Hockey, Inc. has not protected the existing member team of FM Junior A Hockey, LLC, doing business as the Fargo-Moorhead Jets, by allowing another team to operate a team within the same city as the existing USA Hockey, Inc. member team.

4. As the umbrella organization for junior hockey in the United States USA Hockey, Inc. has permitted the encroachment by a proposed new junior hockey team of one affiliate league into the territory of an existing member team of another affiliate league. Affiliate leagues have territorial restrictions in their governing documents; however, encroachment permitted by USA Hockey, Inc. does not protect a team of a different affiliate league.
As a result of the above actions, the Fargo-Moorhead Jets have suffered damages that include the loss of revenue and fan attendance, prospective players declining to play for Fargo-Moorhead Jets and existing players facing uncertainty in their hockey future.

Thank you.

Very truly yours,
Steven C. Opheim

cc: FM Junior A Hockey, LLC
The Jets may have something with Objection 1, but adherence to their own rules and regs has never been a strong point within USA Hockey (specifically, the Junior Council), and I've heard that an amendment to remove the provision in question is up before the Council at the Winter meetings. Still, even if an objective review of the (lack of) notification were to find in favor of the Jets, 'm left asking myself "or else what?" because the regulations lack any punitive teeth.

I'm not sure Objection 2 holds much water, as there's nothing that says approval must be obtained before conducting such activities. Objections 3 and 4 are largely irrelevant, as USA Hockey has nothing in the Rules and Regs providing for territorial protection, and has protected markets in the past.

This is my interpretation of the Regs. If I'm missing something, email me the specific citation.

The letter was also sent to the Fargo Park Board and Fargo Forum. However, the Park Board still voted 5-0 tonight to accept the gift of the arena thus moving the project forward as a tax exempt 501(c)3 entity.

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