May 1, 2008
Former NBA Seattle Supersonics Owner Files Suit to Rescind Purchase Agreement
Listen to the Ehrlichman interview
Summary: Dorsey partner Peter Ehrlichman appeared on the Dori Monson radio show on KIRO 710 AM (Seattle) to discuss a lawsuit filed by Starbucks Chairman Howard Schultz to rescind his 2006 sale of the NBA Seattle Supersonics to Oklahoma City businessman Clay Bennett. Bennett intends to relocate the team to Oklahoma City at the end of its lease with Seattle's Key Arena, which could occur in 2010 or before the 2008-2009 season, depending on the outcome of litigation over the lease. Relocation for the 2008-2009 season only was given conditional approval by the NBA on April 18, 2008. On April 22, Schultz, the prior owner of the Supersonics, filed suit in the U.S. District Court for the Western District of Washington, seeking rescission of the 2006 sale on the basis of alleged fraudulent misrepresentations by Bennett regarding his willingness to keep the team in Seattle.
Ehrlichman said the case had a reasonable chance of success. He pointed to the recent revelation of emails sent by Bennett prior to the 2006 sale, which suggest Bennett had no intention of keeping the team in Seattle. During purchase negotiations, Bennett allegedly assured Schultz that he would make a "good faith" effort to keep the Supersonics in Seattle, promises that Schultz allegedly relied on in his decision to sell the team. Ehrlichman also said the remedy sought by Schultz was unique in his experience of rescission cases. Whereas most rescission cases seek the restoration of the property or financial interest at stake, Schultz's suit instead seeks the appointment of a court-appointed receiver to hold the team in receivership until a new owner willing to keep the Supersonics in Seattle can be found.
The Dori Monson interview of Dorsey partner Peter Ehrlichman was broadcast on KIRO 710 AM, on April 23, 2008.