The ongoing Ottawa Senators arena legal battle took another turn Tuesday, when a more than $1 billion countersuit was filed against team owner Eugene Melnyk.
Plans for a new Senators arena as part of a larger LeBreton Flats redevelopment initiative have been in flux, as Melnyk filed a $700-million lawsuit last month that named RendezVous LeBreton Group business partner John Ruddy as a defendant. In that lawsuit, Melnyk claimed that Ruddy had a conflict of interest because he was planning to build a condominium tower on a nearby property through a separate development effort, and had kept those plans hidden from Melnyk and his Capital Sports Management Inc. (CSMI).
Ruddy and his Trinity Development have now countersued Melnyk and CSMI, with one of the claims being that Melnyk and CSMI were kept in the loop on the condominium development plans. A proposal released by CSMI shortly after the countersuit was filed called for Trinity to take over the redevelopment project and keep all revenue, while building a new arena that would be operated by the Senators. However, Trinity contends that that concept confirms some key claims in its countersuit–that Melynk has all along sought for another party to finance the arena, and that the partnership is on the rocks because of his company’s unstable financial situation. More from the Ottawa Sun:
“Our court filings today made clear that Mr. Melnyk and CSMI have been demanding a free arena courtesy of local taxpayers and Trinity,” Trinity said in a written statement. “Mr. Melnyk’s letter does little more than confirm that fact. On its surface, it appears nothing has changed.”
Meanwhile, the legal manoeuvring continued.
Ruddy’s counterclaim alleges the hockey magnate’s company is on shaky financial footing and has been the main reason why their LeBreton Flats redevelopment partnership is ruined.
While CSMI’s original lawsuit alleged it was kept in the dark about a Trinity-involved development planned across from LeBreton Flats at 900 Albert St., Ruddy’s statement of defence alleges CSMI and Melnyk knew about the multi-tower project all along, pointing to Senators former chief executive Cyril Leeder as being “well informed” about the future 65-storey complex.
The arena project has been viewed as a potential boost to the Senators, who have struggled with revenue and attendance issues at Canadian Tire Centre, their current home in suburban Kanata. However, the ongoing legal dispute has brought uncertainty to the development plans, and National Capitol Commission–the crown corporation in control of the land targeted for redevelopment–is meeting again in January, and has left open the possibility of seeking another plan for the site if the partnership issues surrounding the Senators’ LeBreton Flats pitch cannot be resolved.
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