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Judge rejects millionaires' challenge to own Canucks; brawl for costs next

The Hockey News

The Hockey News

VANCOUVER - The ownership of the Vancouver Canucks won't change, but the ugly off-ice hockey brawl between the current owner and his two former associates could go into overtime.

B.C. Supreme Court Justice Catherine Wedge ruled Thursday that Francesco Aquilini was no longer partners with Tom Gaglardi and Ryan Beedie when he made his successful solo bid to buy the Canucks franchise.

The epic battle began about five years ago when the three men agreed to work together for an ownership interest in the hockey club and ended in a five-month court fight over promises, obligations and duties.

Aquilini, whose honesty and business practices were cross-checked by Beedie's and Gaglardi's lawyers during the trial, was pleased with the verdict, though he didn't crow.

"My brothers and I have no interest in carrying on a public fight with the Gaglardis or the Beedies," he said.

But his lawyers have advised him to ask a court to ensure Gaglardi and Beedie cover his legal costs in the case and also be required to pay him "special costs."

A court can grant those if a judge concludes there has been "reprehensible conduct" on the part of one of the parties.

Aquilini's brothers, who also share in the family ownership of the team, didn't discount the possibility of suing the other two for libel.

"There are real costs here and the real costs are seeing my brother up there, being cross-examined by skilful, experienced, surgical lawyers asking him very tough questions, questions about his character, about his honour and things that he did not do wrong," said Roberto Aquilini.

"Seeing him go through that process and having sleepless nights about what people think of him and second guessing himself after these skilful questions were being asked. That, to me, is the real cost.

"I would not wish it on anybody else."

In November 2004, Francesco Aquilini purchased half the hockey team for $250 million from American telecom billionaire John McCaw, only days after negotiations for the team fell through with Gaglardi and Beedie.

Gaglardi and Beedie claimed the trio had an agreement to work together in a partnership or joint venture and that Aquilini had a duty to them not to purchase the Canucks on his own behalf.

Gaglardi and Beedie went to court claiming they were the rightful owners of the Canucks and wanted the court to order Aquilini to put the team in a constructive trust for them.

In a judgment almost as thick as a hockey puck, Wedge rejected that claim, even using sports language to get her point across.

"When the partnership dissolved, the partners became free agents, equally at liberty to persuade their own interests," she wrote.

Wedge concluded the relationship among the three wasn't a partnership or joint venture, and even if she is wrong she said that partnership ended when Aquilini gave notice of his departure nine months before he purchased the team.

Wedge noted there was no valid partnership contract and the three weren't carrying on business together.

"Former partners and joint venturers are free to compete with one another unless they have negotiated a non-competition clause as part of their agreement," Wedge pointed out in her ruling.

The Gaglardi legal team claimed Aquilini misused confidential information and breached his duty of confidence to them.

Gaglardi testified at the trial that Aquilini wanted to be kept informed about their negotiations with the team's then-owner Orca Bay Hockey. Aquilini denied the allegation.

"The documentary record does not support Gaglardi's evidence," Wedge wrote, noting Gaglardi and Beedie stopped copying e-mail notes and exchanges to Aquilini from Orca Bay.

"There is no evidence to suggest that Gaglardi or Beedie provided Aquilini with any information of substance concerning their negotiations with Orca Bay."

Lawyers for the failed Canucks buyers claimed that despite Aquilini's departure from the group, the partnership continued.

"That is neither an accurate characterization of the facts, nor a correct statement of the law," Wedge ruled.

The Gaglardi group wanted the court to order Aquilini's offer to be set aside and that half the team be sold to them based on the Oct. 30, 2004, offer.

Aquilini eventually purchased the entire hockey club from McCaw, and if Wedge had agreed to Gaglardi's suggested remedy, the three men would have been partners in the team.

If that solution wasn't chosen by the court, the Gaglardi team asked for damages from Aquilini because they were deprived of purchasing the team by an act of bad faith.

Wedge believes Aquilini owes them nothing and invited his lawyers to talk about legal costs later.

"Aquilini was not bound by any fiduciary obligation to Gaglardi and Beedie when he entered into negotiations with Orca Bay in late October or early November 2004," she ruled.

Gaglardi and Beedie said in a written statement they were disappointed by the judge's decision.

"We have not wavered in our belief that this opportunity was wrongly taken away from us," they said.

"However, we respect the time and efforts of Justice Wedge in reaching her conclusions."

The statement said they will review the judgment and then decide the next steps to take.

McCaw issued a statement saying he was pleased with the ruling that his Orca Bay's dealings with Acquilini were above board.

"It is unfortunate that this lawsuit has consumed a large amount of time and resources over the past three years and cast needless uncertainty over the future of the Vancouver Canucks' franchise," he said.

"The court's ruling affirms that we acted with good intentions and integrity in our efforts to find a local buyer for the team."

Aquilini and Gaglardi came together naturally - their fathers had done business together for years and the pair had known each other for a long time.

Beedie, who is also the second-generation in a scion family of B.C. business people, is a long-time acquaintance of Gaglardi's who hadn't had many dealings with Aquilini before the group came together.

Aquilini said the events that led up to his purchase of the Canucks were routine and simple.

"If you ask any business person, deals happen and they fall apart all the time," he said. "This is a case where initially we tried to do something together it didn't work."

But the court fight was unprecedented, challenging the definition of a partnership, among other things.

When Aquilini was asked Thursday if he would do anything differently, he responded: "Absolutely not. Besides skipping the part of dealings with Ryan Beedie, absolutely not."


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