Mcconnell v. Hunt Sports Enterprises

725 N.E.2d 1193 (1999)

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Nature of the Case

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Facts

McConnell (P) and Wolfe Enterprises (P1) filed a complaint for declaratory judgment against Hunt Sports Enterprises (D), Hunt Sports Enterprises, L.L.C. (D1), Hunt Sports Group, L.L.C. (D2), and Columbus Hockey League (D3). D3 was a limited liability company formed under R.C. Chapter 1705. This suit came about from an inquiry by the NHL into Columbus, Ohio competing for a new hockey franchise. The mayor of the city was notified and contacted local business persons in the community to possibly apply for a new franchise. Two of these persons were Pizzuti, and P. Pizzuti began to recruit investors and approached Lamar Hunt, principal of Hunt Sports Group. On October 31, 1996 D3 was formed. The members of D3 were P, P1, Hunt Sports Group, Pizzuti Sports Limited and Buckeye Hockey, L.L.C. Each member made an initial capital contribution of $25,000. There was an operating agreement between the members. An application for a franchise was filed by the November 1, 1996 deadline. A $100,000 check and a plan for an arena to be financed by an increase in the county sales tax to be voted on in the May 1997 ballot were included. The sales tax issue failed. Dimon McPherson of Nationwide Insurance Enterprise met with Hunt to discuss the possibility of building the arena. They began to work on that plan, and the Mayor spoke with the Commissioner of the NHL and was given until June 4, 1997, to come up with an alternate plan. Nationwide came up with a plan but Hunt Sports Group did not accept the lease proposal. McPherson then told Hunt that the city council was going to vote on the same plan with the city building the arena. McPherson did not want the deal to fall apart and then went to P and P was somewhat shocked to learn of what was going on, and P told McPherson that if Hunt did not step up that he would. The city council passed the resolution. After various maneuvers on each side, P eventually agreed to apply for the franchise. The next day, Hunt then informed McPherson that he was still interested in pursuing a deal with Nationwide. The NHL was informed of the goings on with Nationwide and P and that Hunt was still on the sidelines. They then sent Hunt a letter requesting a drop-dead notification and Hunt responded that D3 intended to pursue the franchise and that a meeting was to be held in three days with all members of D3 but that the application was contingent upon an appropriate lease agreement. In a final commitment meeting, many of the D3 members did not like the lease terms and decided not to sign. Some of them did, and the signature line was changed on the lease and P signed along with seven others. Columbus got the nod from the NHL, and on the same day, this case was filed. In their complaint, McConnell and Wolfe Enterprises requested a declaration that they could compete with D3. A counterclaim was asserted for breach of contract, breach of fiduciary duty, and interference with prospective business relationships. Ps filed a motion for summary judgment and the trial court granted it; the agreement was clear and unambiguous and allowed Ps to compete against D3. The claims that remained included a breach of fiduciary duty and interference with prospective business relationships. A jury trial was held, and directed verdicts were given Ps. Ds appealed.