ECHL-CHL Absorption; What’s The Hold-up?

The best and worst kept secret of the hockey offseason has to be the absorption of the Central Hockey League by the ECHL. It’s something that has been talked about happening for months now, but there have been so few details put out about it that it’s been quite a well-kept secret at the same time. But the biggest questions on everyone’s mind has been why there is so much secrecy, and why it’s taken as long as it has to come to a conclusion. With ECHL training camps already beginning, and CHL camps slated to begin next week, the final toll of the clock is about to strike. But before it does, let’s look at why I think it has taken so long, and why it may hopefully come to an end early next week.

You may remember last year, when the Rapid City Rush and the Allen Americans were rumored to be moving to the ECHL, following the end the of the 2012-13 season. Ultimately, it’s a move that didn’t happen following a court injunction and since then, an on-going civil suit between the owners of the CHL (WPHL Inc.)  vs. the ECHL, Rapid City Rush, and Allen Americans. Since that point, the CHL has been sold to the team owners, and the Allen Americans were sold to another set of owners. So in the grand scheme of things as they sit right now, it’s the old owner of the CHL (WPHL Inc.) vs. the ECHL and Rapid City.

As part of the beginnings of the case, WPHL Inc. –

“sought, among other things, an injunction enjoining Rapid City from (1) “leaving the CHL [the d/b/a of WHPLI] . . . from joining, affiliating, or participating in the East Coast Hockey League”; and (2) “from soliciting or assisting other franchises to leave the CHL . . . and from interfering with the sale of Plaintiffs’ interest in the CHL.””

“On May 31, 2013, this Court granted a temporary injunction against Team Defendants enjoining Rapid City from leaving the WPHL to join the East Coast Hockey League.”

Since that point, the Rapid City Rush have been trying to fight that injunction, basing it off of an amendment that was made to their license agreement with the WPHL Inc. On September 10th, 2013, the Rush filed for a Partial Summary Judgement regarding this injunction.

“Also on July 15, 2007, WPHLI and Rapid City executed an Amendment to License Agreement. Section 3 of the Amendment creates an exception to the non-competition provision in Section 18 of the License Agreement. Specifically, under the Amendment, if the WPHLI is ever sold or its interest is assigned and transferred, Section 18 of the License Agreement “does not apply.” The provision reads, in pertinent part:

Non-Competition Provision. The Non-Competition provision set forth in section 18 of the License Agreement will remain as written provided that WPHLI maintains a professional standard of operation consistent with the current AA level of professional play or higher. In the event that the WPHLI does not, at a minimum, maintain a professional standard of operations consistent with the current AA level of professional play, section 18 of this agreement would not be enforced. Section 18 shall also not apply if the WPHLI d/b/a CHL sells, assigns or transfers its interest or otherwise ceases to exist under the name WPHLI d/b/a CHL. (emphasis added)”

Since this was heard on October 24th, 2013, there have been a number of letters sent to the courts regarding this hearing by the attorneys representing the Rapid City Rush, all generally saying the same thing. The most recent one was sent on August 28th, 2014.

“I am writing in connection with Defendants Scott Mueller’s and Rapid City Professional Hockey, LLC’s Motion for Partial Summary Judgment and to Modify Temporary Injunction (the “Motion”).

The Motion was filed September 10, 2013, and the court heard argument on the Motion on October 24, 2013. At the conclusion of that argument, Plaintiffs requested an opportunity to submit additional briefing, which the Court permitted. Plaintiffs filed their supplemental brief on October 29, 2013, and the Rapid City Defendants filed their supplemental brief on November 1, 2013. Once these supplemental filings had been made, the Motion was fully briefed and ripe for a decision.

At a hearing on November 26, 2013, the Court indicated that it thought it had ruled on the Motion, and I advised that I had not seen such an order. At a separate hearing on February 12, 2014, the Court indicated that it would try to enter an order by the end of February. As of today, no order has been entered in connection with the Motion.

I recognize that the Court has many matters on its docket. My clients, however, urgently require a ruling in order to make plans regarding the operation of their business. Accordingly, my office contacted the clerk yesterday to schedule another hearing on the Motion; we were advised to send this letter to your Honor explaining the basis for our request for a hearing.

Please let me know if the Rapid City Defendants can provide any additional briefing in connection with the Motion.
Otherwise, I respectfully request that the Motion be set for a final hearing at the Court’s first available setting.

Respectfully submitted,”

The trial is currently set for this coming Monday, October 6th, and I have to imagine the Rapid City Rush push for a ruling on this motion at that point. All signs have indicated that the announcement could be made on Monday or Tuesday, most likely coming after a ruling is made (or continues to have not been made). Mainly, this injunction wholly affects the Rush’s ability to join the ECHL, but it could also throw a wrench in the other CHL teams whose license agreements were most likely worded the same way prior to WPHL Inc. selling their interest to the CHL owners.

Monday and Tuesday seem to be the goal, but if nothing comes of it, the CHL may not be able to have a season, as I haven’t seen any type of Collective Bargaining Agreement from the league this season which may hamper a lot of insurance issues regarding the players. Stay tuned.