Phoenix Coyotes bankruptcy

The Phoenix Coyotes, a professional ice hockey team now known as the Arizona Coyotes and playing in the National Hockey League (NHL), filed for bankruptcy in 2009 after incurring several hundred million dollars of losses since their move to Phoenix, Arizona from Winnipeg, where they were known as the Winnipeg Jets. Bankruptcy court rejected a plan to sell the team and move it to Canada, and the team was purchased by the NHL. The NHL operated the team in Phoenix for four seasons while seeking a new owner. After several prospective purchases fell through, the team was finally sold in the summer of 2013.

In December 2008, the media became aware that the Phoenix Coyotes were losing money at a high rate and were being funded by the NHL directly. The media reports were minimized by NHL Commissioner Gary Bettman and Deputy Commissioner Bill Daly, but secretly the NHL had taken over operations of the Coyotes. In May 2009, the owner of the team, Jerry Moyes, put the team into bankruptcy hours before receiving Bettman, who was to present a potential offer to purchase. Moyes intended to sell the team to Canadian billionaire Jim Balsillie, who intended to purchase the team out of bankruptcy and move it to Hamilton, Ontario, without being restricted by the NHL's rules on relocation.

From May 2009 until September 2009, hearings were held in Phoenix bankruptcy court to determine the fate of the Coyotes and the holding company. Two potential bidders for the team surfaced—Chicago White Sox owner Jerry Reinsdorf and Ice Edge Holdings, Inc.—but they did not put in bids for the team at the bankruptcy hearing. Instead, the NHL put in the only rival bid to Balsillie for the team, while they fought Moyes' plan to sell the team and move it to Hamilton against the NHL rules. Ultimately, the Phoenix court ruled that the team could not be sold to Balsillie, as the judge held that bankruptcy could not be used to subvert the league's rules. The NHL's original bid was also insufficient for the bankruptcy judge, since it did not treat Moyes and Gretzky as full creditors. Later, the NHL settled with Moyes with the league buying the team and assuming all debts.

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Wikipedia