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Report: Islanders owner Charles Wang facing $10 million lawsuit for backing out of $420 million sale

According to a report in the New York Daily News, Islanders owner Charles Wang is being sued by hedge-fund manager Andrew Barroway for backing out of a deal to sell the franchise for $420 million.
The Hockey News

The Hockey News

In terms of the on-ice product, it’s been a pretty optimistic summer for the New York Islanders. And that’s saying something.

Motivated by the fact their first round pick in next summer’s Connor McDavid draft is owned by the Buffalo Sabres, the Islanders were fairly aggressively trying to improve this off-season. They acquired and signed Jaroslav Halak, giving them a statistically solid NHL starter for the first time in a long, long time. They signed Mikhail Grabovski for about market value, and though he comes with a little too much baggage for some, his possession stats are favorable and he should provide improvement on the second, or third, line, which the Islanders desperately needed. They still don’t have Andrew MacDonald on the blueline (phew) and fans are eager to see what more John Tavares, Kyle Okposo and Josh Bailey can do, to say nothing of potential 2014-15 full-timers Ryan Strome and Griffin Reinhart.

But with the Islanders, there’s always something looming in the background. No, we’re not talking about their move to Brooklyn after next season. We’re talking about ownership and a lawsuit.

According to a report in the New York Daily News, Islanders owner Charles Wang is being sued by Philadelphia hedge-fund manager Andrew Barroway for $10 million after Wang backed out of a deal to sell the franchise for $420 million.

The suit alleges Steve Ballmer’s purchase of the NBA’s Los Angeles Clippers for $2 billion influenced the potential Islanders sale.

From the Daily News:

In papers filed in Manhattan Supreme Court, Barroway's corporation blames Wang’s “about-face” on a whimsical case of “seller’s remorse” directly influenced by the “unrelated news” of former Microsoft CEO Steve Ballmer’s $2 billion bid to buy the NBA’s Clippers from Donald Sterling, the team’s embattled, soon-to-be-former owner.

Sterling recently lost his attempt to block the sale to Ballmer. In Wang’s case, proceedings are just getting started.

NY ICE’s lawsuit claims the parties "shook their hands on an agreement" and NY ICE started to line up NHL approval and financing for the $450 million price agreed upon in March. However, Wang "without notice, abruptly refused to proceed to close the transaction and honor the terms of their 70-page purchase agreement and instead "improperly sought to renegotiate the already agreed upon price."

The suit claims Wang started to demand $548 million for the Islanders franchise in a meeting on July 16. The report goes on to say that, after unproductive meetings between the Wang and Barroway sides, Wang informed Barroway in early August of his intention to sell the franchise to other bidders.

NYC ICE is claiming it is entitled to a $10 million “break up” fee the two parties agreed to during negotiations. According to the report, the deal that was negotiated in March set up NYC ICE to acquire 100 percent of the Islanders franchise and for Wang’s corporations to obtain a 25 percent interest of NYC ICE.

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