Precourt Sports Ventures court filing on six-month relocation notice

IN THE COURT OF COMMON PLEAS FRANKLIN COUNTY, OHIO STATE OF OHIO ex rel.

OHIO ATTORNEY GENERAL MIKE DEWINE, et al., Plaintiffs, v.

PRECOURT SPORTS VENTURES, LLC, et al., Defendants.

) ) ) ) ) ) ) ) ) ) ) )

Case No. 2018 CV 001864 Judge Jeffrey M. Brown

DEFENDANTS’ MEMORANDUM IN OPPOSITION TO PLAINTIFF CITY’S MOTION TO TOLL R.C. 9.67’S SIX-MONTH NOTICE PERIOD After filing an aggressive Complaint seeking to enforce an inapplicable and unconstitutional statute, Plaintiff City of Columbus (“City”) now expands its efforts to interfere with Defendants’ interstate business operations, asking this Court to rewrite the terms of Ohio Revised Code Section (“R.C.”) 9.67. That statute purports to prevent the owner of a professional sports team that meets certain criteria from relocating the team unless the owner either receives permission from the local government where the team plays or gives the local government “six months’ advance notice” of the team’s intention to move, during which time it must provide the local government or local residents an “opportunity” to purchase the team. R.C. 9.67 (emphasis added). The City now asks this Court to turn that statutory six-month notice period into a ban that could literally last for years. There is no legal, equitable, or other basis for extending the statutory period. Courts are not legislatures, and this Court should deny the City’s motion to “toll” the notice period provided by R.C. 9.67 for at least four reasons.

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First, as explained in Defendants’ Motion to Dismiss, R.C. 9.67 does not apply to Defendants both on its own terms and because the statute is blatantly unconstitutional. As R.C. 9.67 does not apply to Defendants, there is no required notice period for the Court even to consider tolling.

Second, even if R.C. 9.67 applies to one or more of the Defendants, this Court lacks authority to alter the six-month notice period provided by the statute. Under Ohio law, equitable tolling is a concept limited to statutes of limitations. While courts may toll statutes of limitation in extremely limited circumstances, Ohio law expressly prohibits them from overriding the provisions of statutes like R.C. 9.67 that attempt to regulate commercial behavior rather than mere judicial filing deadlines.

Third, the City utterly fails to justify why it should be entitled to such relief. The City argues that because “it will take more than six (6) months to resolve the litigation,” failure to extend the notice period will somehow “result[] in the complete denial of the [City’s] rights.”

That makes no sense. Nothing about this litigation—litigation that the City itself brought—has prevented or currently prevents interested bidders from making offers to purchase the rights to operate Columbus Crew SC (“Crew SC”). Indeed, the Amended Complaint (“Complaint”) admits that Defendant Precourt Sports Ventures LLC (“PSV”) has already engaged in conversations with at least one interested bidder. The City cannot argue that its rights and interests are being thwarted by its own lawsuit. On the other hand, arbitrarily and unlawfully extending the notice period provided by R.C. 9.67 would cause irreparable harm to Defendants by further interfering with their interstate business operations.

Fourth, the City’s motion is nothing more than a thinly disguised attempt to obtain a preliminary injunction without showing substantial likelihood of success on the merits or any of

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the other requirements necessary to obtain such relief. The City admitted as much in the press release it recently issued, conceding that the Motion to Toll is a “tactic” to keep Crew SC in town so that investors have time to bid. See April 9, 2018 Press Release, attached as Ex. A. But R.C. 9.67 does not authorize an indefinite notice period. One point on which the legislature was clear is the length of the notice period that a team owner owes the relevant local government: six months during which bidders can pursue an opportunity to purchase the operating rights to the team and nothing more. For the Court to hold otherwise would be to allow the City to make an impermissible end run around the State’s injunction requirements.

In short, both in its efforts to stretch the statute beyond its terms by its Complaint and in its effort to extend indefinitely the statute’s notice period—in direct contravention of its express terms—the City seeks to transform the statute from a procedural process to prevent a sports team from suddenly departing from the state into a substantive sword to delay and block relocation.

However problematic the statute may be on its own, it cannot begin to carry that additional weight. For the reasons explained herein, this Court should reject the City’s tactic and deny the motion.1 ARGUMENT I.

THE COURT CANNOT TOLL THE APPLICATION OF R.C. 9.67 BECAUSE R.C. 9.67 DOES NOT APPLY TO DEFENDANTS IN THE FIRST PLACE. The Court should deny the City’s motion to toll because, as set forth in Defendants’

Motion to Dismiss and incorporated here by reference, R.C. 9.67 does not apply to Defendants

1

The Ohio Attorney General did not join in this motion or otherwise initially request tolling. On April 20, 2018, the Attorney General filed his own motion to toll in connection with his opposition to Defendants’ Motion to Stay Discovery. Defendants’ opposition to that motion is due on May 4, 2018, and they reserve their rights to make additional arguments against tolling there.

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both on its face and because the statute is unconstitutional. As the statute is inapplicable, there is no required six-month notice period for the Court to toll.2 II.

EVEN ASSUMING THAT R.C. 9.67 APPLIES, THERE IS NO BASIS TO TOLL THE STATUTORY NOTICE PERIOD. A. Courts May Not Toll Statutory Provisions That Regulate Primary Behavior.

Even assuming that R.C. 9.67 were to apply to one or more Defendants and were

constitutional, the Court lacks the authority to do what the City asks of it—namely, to fundamentally rewrite the terms of R.C. 9.67 and turn the six-month notice period prescribed by the legislature into one that could last for years. As the Ohio Supreme Court has proclaimed: “[I]t is not the role of the courts to establish their own legislative policies or to second-guess the policy choices made by the General Assembly. [T]he General Assembly is responsible for weighing [policy] concerns and making policy decisions; we are charged with evaluating the constitutionality of their choices.” Kaminski v. Metal & Wire Prods. Co., 125 Ohio St. 3d 250, 2010-Ohio-1027, 927 N.E.2d 1066, at ¶ 61 (Ohio 2010) (internal citations omitted).

R.C. 9.67 provides for the commencement of a six-month notice period beginning on the date that a team owner subject to the statute provides notice of the owner’s intent to relocate.

See R.C. 9.67. While the statute has myriad defects, it is clear and unambiguous on this point— once notice has been given, the clock starts ticking. To hold otherwise would be to contravene the clear intent of the legislature, something that this Court cannot do. See, e.g., State ex rel.

Clay v. Cuyahoga Cty. Medical Examiner’s Office, 2017-Ohio-8714, --- N.E.3d ----, 2017 WL 5907902, at ¶ 15 (Ohio 2017) (“primary rule” of statutory construction is to “give effect to the

2

If the Court does not immediately deny the instant motion for the reasons discussed in Point II, Defendants respectfully request that the Court defer ruling until after it has fully evaluated and ruled on Defendants’ Motion to Dismiss, since a ruling in Defendants’ favor on that motion would dictate the correct result here.

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legislature’s intention”); State v. Brown, 2014-Ohio-314, 8 N.E.3d 345, at ¶ 27 (10th Dist. 2014) (it is “is axiomatic that this court may not itself rewrite a statute to change the clear meaning of statutory text”).

Nonetheless, the City asks this Court to apply the doctrine of equitable tolling to rewrite the terms of R.C. 9.67. The Court may not do so. Ohio law is clear: while courts may toll the running of statutes of limitations in limited circumstances, see McCualsky v. Appalachian Behavioral Healthcare, 2017-Ohio-8841, --- N.E.3d ----, at ¶ 18 (10th Dist. 2017), they may not use equitable principles to change the underlying requirements of a statute adopted by the Ohio legislature. See, e.g., Thrasher v. Watts, 193 Ohio App. 3d 569, 2011-Ohio-2844, 952 N.E.2d 1207, at ¶¶ 23–24, 27 (Ohio 2011) (overturning a trial court decision that ignored an Ohio statute in favor of an equitable remedy because the court’s discretion to fashion a fair remedy in equitable matters “cannot flout or override specific statutory mandates”);; Ohio Envtl. Prot.

Agency v. Lowry, 2013-Ohio-2779, 994 N.E.2d 912, at ¶ 9 (10th Dist. 2013) (rejecting argument that application of statute was “inequitable, unjust, and unfair in application and scope” and instead finding that “[t]his court may not effectively rewrite [an Ohio statute by inserting requested provisions] when the General Assembly did not do so”).

None of the cases cited in the City’s motion provides any support for the proposition that equitable tolling may be used to rewrite the terms of R.C. 9.67. The non-competition agreement and oil and gas lease cases cited by the City all deal with the revision of agreements between two or more private parties—a far cry from the revision of legislation enacted by the General Assembly.3 See Pl.’s Mot. to Toll at 9 n.6, 9 n.7, 10, 11–12 (citing cases).

3

Ohio has long recognized that its courts have the equitable power to enforce contracts through rescission, reformation, and specific performance. See, e.g., Haman Enters., Inc. v. Sharper Impressions Painting Co., 2015-Ohio-4967, 50 N.E.3d 924, at ¶ 19 (10th Dist. 2015); Andrew v. Power Mktg. Direct, Inc., 2012-Ohio-4371, 978 N.E.2d 974, at ¶ 47 (10th Dist. 2012). But that power is not related to the

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The only cases cited in the City’s motion that deal with tolling of a statute at all are cases related to the tolling of statutes of limitations and judicial filing deadlines. See id. at 9 n.4, 9 n.5, 10–11 (citing cases). But such cases are inapposite here. At their core, statutes of limitations and other filing deadlines are “claim-processing rules” that enable courts to determine when parties can bring their claims in court. See, e.g., United States v. Kwai Fun Wong, 135 S. Ct. 1625, 1632 (2015). Such rules have no bearing on the underlying requirements of a statute that regulates parties’ behavior in the commercial sphere. Though it includes a deadline, R.C. 9.67 is plainly not a statute of limitations or a filing deadline but rather a statutory directive that purports to require some action by the owner of a sports team in certain circumstances. Those requirements, in establishing a procedure that team owners must follow, are the substance of the statute and are not subject to tolling.

In moving to toll the six-month notice period provided by R.C. 9.67, the City asks the Court to do what it cannot: to “override” the legislature’s “specific statutory mandate[]” that team owners provide six months’ notice prior to relocation. See Thrasher, 193 Ohio App. 3d 569, at ¶ 27. As the Court is not empowered to do so, it should deny the City’s motion.

B. Equitable Tolling Is Inappropriate Where, as Here, There is Nothing Unfair About Holding the City to the Time Limits Prescribed by Statute.

Even assuming both that R.C. 9.67 were to apply to any of the Defendants (which it does not) and that this Court could override the legislature’s six-month notice provision (which it cannot), the City would still not be entitled to equitable tolling. Even in those cases dealing with the equitable tolling of a statute of limitations—the only cases in which Ohio courts have applied the doctrine to statutory deadlines—Ohio courts have consistently held that equitable tolling

doctrine of equitable tolling and does not grant courts the authority to violate the separation-of-powers doctrine and rewrite the terms of a statute enacted by the Ohio General Assembly.

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should be applied only in extraordinary circumstances. See, e.g., McCualsky, 2017-Ohio-8841, at ¶ 18 (“Equitable tolling is only available in compelling cases which justify a departure from established procedure.”);; Coleman v. Columbus State Cmty. Coll., 2015-Ohio-4685, 49 N.E.3d 832, at ¶ 16 (10th Dist. 2015) (“The doctrine of equitable tolling is to be applied sparingly and in only exceptional circumstances.”);; In re Regency Vill. Certificate of Need Application, 2011Ohio-5059, 2011 WL 4541358, at ¶ 37 (10th Dist. 2011) (litigant seeking to toll a statute under the doctrine of equitable tolling “must demonstrate [that it] diligently pursued [its] rights, but some extraordinary circumstance stood in [its] way and prevented timely action”).

Indeed, the doctrine is “generally limited to circumstances in which a [party] is intentionally misled or tricked into missing the filing deadline.” Coleman, 2015-Ohio-4685, at ¶ 16 (emphasis added); see also, e.g., McCualsky, 2017-Ohio-8841, at ¶ 18 (tolling of a statute of limitations limited to situation where “defendant prevented plaintiff from timely filing”). No such extraordinary circumstances are present here, and the City does not even attempt to argue otherwise. See generally Pl.’s Mot. to Toll. That fact is fatal to the City’s argument.

The crux of the City’s motion is its argument that Defendants are trying to use this litigation to “run the clock” on the statutory notice period. See Pl.’s Mot. to Toll at 3. But that gets it exactly backwards. It is the City that brought the lawsuit. The City can hardly complain that its own actions are keeping its residents from making offers to buy the team. Defendants had every right to move to dismiss the Complaint because the statute is inapplicable and unconstitutional, and they are hopeful that this Court will grant their motion. However, precisely because it is Defendants that would be harmed by long-term uncertainty regarding the status of the statute, they have in no uncertain terms made clear in writing that notice has been given and are providing opportunities for interested parties to seek to purchase PSV’s operating rights to

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Crew SC and its minority equity interest in Major League Soccer, L.L.C. (“MLS”) (and its affiliated entities), while Defendants have of course reserved their rights challenging the statute.

That it may take longer than six months for the Court to resolve the case is not a reason in and of itself why Defendants should be held hostage and become subject to a different—and longer— time period than the statute prescribes.

Furthermore, the City’s entire argument is based on a false premise. Nothing about this litigation has prevented, or currently prevents, interested parties from submitting offers to purchase the rights to operate Crew SC. They can do so right now, just as they have been able to do since Day 1. As the Complaint admits, PSV engaged in talks with an interested bidder during the notice period. (Compl. ¶ 30.) Moreover, in December 2017, PSV provided a non-disclosure agreement (“NDA”) to a prominent citizen who expressed an interest in purchasing the rights to Crew SC, but PSV never received a signed NDA, nor did the individual to whom it was provided attempt to negotiate its terms. See Aff. of Andrew Loughnane, attached as Ex. B. On March 16, 2018, Defendants sent an open letter to Mayor Ginther and the Franklin County Board of Commissioners (the “Notice Letter”) that, among other things, clearly instructs interested bidders to contact Defendants with their bona fides. See Notice Letter, attached as Ex. C. As has been publicly reported, in March 2018, MLS officials met with potential local investors in Columbus.

See Columbus Dispatch article, attached as Ex. D. More recently, among other things, counsel for MLS contacted counsel for the Attorney General to reiterate its willingness to talk to interested bidders and to provide relevant financial information subject to an NDA. See April 12, 2018 e-mail chain, attached as Ex. E. MLS recently provided such an NDA to the same citizen with whom PSV engaged in conversations last year, as well as an additional party. See Aff. of William Z. Ordower, attached as Ex. F.

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The City maintains that the Notice Letter created an “untenable dilemma” because it listed several dates on which notice was given. See Pl.’s Mot. to Toll at 7. That is a disingenuous argument. Defendants aimed to show that they provided notice on multiple occasions and to alert the City as to when the notice period would run according to each alternative. If, as Defendants contend, notice was given on or before October 17, 2017, then the mandatory period ended on or before April 17, 2017.4 If the Court instead were to find that the City was put on notice by November 15, 2017, then the notice period would end on May 15, 2017. In all events, the Notice Letter makes clear that the latest date for triggering the statute was March 16, 2018 in which case the notice period would end on September 16, 2018. But whichever date the Court eventually finds was the date on which notice was in fact given, the six months will run from that date. The City cannot hide its head in the sand, pretend that it does not have notice of Defendants’ intent to relocate Crew SC under R.C. 9.67, and ask this Court to override the legislature and change the terms of the statute as a result.

Indeed, according to the Complaint, the City has been on notice of the potential for the relocation of Crew SC for quite some time. Plaintiffs concluded that the relocation of Crew SC was probable enough to make their lawsuit ripe based on PSV CEO Anthony Precourt’s October 17, 2017 press conference,5 a December 2017 speech by MLS Commissioner Don Garber which 4

Nothing prevents Defendants from continuing to listen to offers, however. R.C. 9.67 requires the provision of “not less than six months’ advance notice,” R.C. 9.67, indicating that while a team owner could comply with the statute by providing only six months’ notice, the owner can also continue to entertain offers for a longer period if it chooses to do so.

5

The City contests the statement in the Notice Letter that, at the October 17, 2017 press conference, Mr. Precourt announced that Defendants would pursue the possible relocation of Crew SC, noting in a footnote that Mr. Precourt also stated at the conference that no relocation decision had been made. See Pl.’s Mot. to Toll at 4 & n.1. That argument contradicts the City’s earlier acknowledgement that “[i]n October 2017, Mr. Precourt announced his intention to move the Crew from Columbus if the city or private investors cannot guarantee him that a downtown stadium will be built for the team.” Compl. ¶ 2.

A review of the transcript of the press conference cited in the Motion to Toll shows that Mr. Precourt did indeed state that he was “exploring . . . potentially relocating the club.” See Tr. of October 17, 2017 Press

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Plaintiffs alleged endorsed the move, “recent[]” comments by Mr. Precourt in which he “spoke at length” about PSV’s efforts to find a stadium site in Austin, and the fact that Austin City Council is “actively considering potential soccer stadium sites” in anticipation of a move by Columbus Crew SC. (Compl. ¶¶ 28–29, 35–36.) Moreover, the October 2017 announcement and December 2017 speech alone were sufficient to prompt the Attorney General to write a letter to Mr. Precourt on December 8, 2017 accusing Mr. Precourt of “exploring … potentially relocating the Club.” (Id. ¶ 3.) Again, as noted above, the Notice Letter provided the City notice of Defendants’ intent to relocate Crew SC on March 16, 2018 at the very latest. See Ex. B.6 In light of that notice, the onus was, and is, on the City—if it is so interested—to help find a bidder for the operating rights to the team within the notice period provided by R.C. 9.67, not to seek a judicial exemption from compliance with the terms of the very statute it seeks to enforce against Defendants. To hold that the six-month notice period could be fundamentally altered based on the expected length of this litigation, which again the City chose to bring, would be patently inequitable to Defendants. The statute cannot operate differently against different team owners depending on whether the State or local government decides to sue them. So, too, the fact that the statute has defects or that its applicability may have textual or constitutional challenges certainly cannot be used as the basis to expand its scope and impact.

Conference, available at https://www.columbuscrewsc.com/post/2017/10/17/transcript-anthony-precourtdave-greeleys-media-conference-call. In announcing that he was considering relocating Crew SC unless certain conditions were met, Mr. Precourt provided notice of the potential for the team’s relocation.

6

Plaintiff City appears to contest that Defendants have provided Plaintiffs with notice at all. See Pl.’s Mot. to Toll at 4 (“If notice was proper under any one of these scenarios (which Plaintiff in no way concedes) . . . .”). That Plaintiff is unwilling to admit that even the Notice Letter, which expressly informs the City that Defendants are providing notice under R.C. 9.67, has provided notice sufficient to comply with R.C. 9.67 is yet another example of why the statute is unconstitutionally vague (as explained in Defendants’ Motion to Dismiss). That position certainly creates no basis to toll the statutory period.

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To the extent that the City is seeking to use its motion to obtain discovery of Crew SC’s financial information, see Pl.’s Mot. Toll at 6 (arguing that the opportunity to purchase the team provided by R.C. 9.67 “necessarily must include a chance for [local] investor[s] to confidentially analyze the financial records of the owner of the Crew”), that would be a completely improper basis to toll the statute. As explained in Defendants’ Motion to Stay Discovery, also incorporated here by reference, the Court is not a tool for private investors (or the City) to do due diligence for a potential deal. See Memo. in Support of Defs.’ Mot. to Stay at 5. Nothing has prevented any interested bidder “who reside[s] in the area” from informing PSV or MLS of their interest in purchasing the team, executing a customary NDA, and asking for the financial information it needs in order to submit a bid. See R.C. 9.67. Indeed, as noted above, Defendants have already spoken to potential bidders during the notice period and have further demonstrated willingness to hear offers from interested bidders. In all events, the City cannot use the fact that the Attorney General served discovery as a basis to modify and further expand the substantive operation of the statute, especially given that Defendants have made a timely motion for a protective order in this litigation in accordance with Ohio law.

That this litigation could continue past the expiration of a statutorily-provided notice period of which the City has long been aware is not an extraordinary circumstance meriting a fundamental rewriting of the statute’s language through equitable tolling.

C. To the Contrary, It Would Be Grossly Unfair to Defendants to Toll the Statute.

Tolling R.C. 9.67’s notice provision would cause Defendants irreparable harm. The City asks this Court to extend indefinitely the six-month notice period that the City also contends is a prerequisite to relocation. See Pl.’s Mot. to Toll at 1; Compl. at ¶¶ 8, Claim for Relief. In effect, the City thus asks this Court to expand improperly the strictures of R.C. 9.67 in a way that would create extraordinary additional hurdles for Crew SC to relocate. In tolling the allegedly required 11 10127528.1

notice period until the final resolution of the litigation, “including any final appeals to the courts of highest authority,” the City and this Court would prevent Defendants from complying with the statute for years. See Pl.’s Mot. to Toll at 1.

Assuming that R.C. 9.67 applies to any Defendant, tolling the notice period would cause Defendants irreparable harm by forcing Crew SC to remain in an underperforming market. See, e.g., Inrex Home Care, LLC v. Ohio Dep’t of Dev. Disabilities, 2016-Ohio-7986, 76 N.E.3d 681, at ¶ 13 (10th Dist. 2016) (“A risk of loss or damage to a business entity qualifies as irreparable harm.”). Keeping the team in limbo would also have a significant and adverse effect on Defendants’ ability to succeed financially by making it more difficult for the PSV Entities to contract with sponsors and attract fans due to the uncertainty surrounding the team’s status, making significant operating losses inevitable and unrecoverable. Denying the club the opportunity to relocate and denying Defendants the opportunity to develop interstate business relationships over a multi-year period would also further exacerbate the serious Constitutional violations identified in the Motion to Dismiss.

The City’s throwaway argument that “Defendants may benefit substantially from equitable tolling, since it may result in a sale of the Crew for more than is currently invested in the team” does not change this calculus. See Pl.’s Mot. to Toll at 13 (emphasis added). In effect, the City is arguing that this Court can prevent Defendants from operating in interstate commerce in the manner that Defendants determine is best for their respective businesses due to the potential that at some point in the next several years the PSV Entities might receive a favorable offer for the team’s operating rights. Even assuming that an offer would be made, as explained in the Motion to Dismiss, R.C. 9.67 unconstitutionally deprives the PSV Entities of fair competition for the operating rights to Crew SC, which would result in offers that have been

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artificially lowered. Moreover, by holding the team hostage for an uncertain length of time and forcing the team to continue to play in a less profitable market the Court would further lower the team’s value in the event of a sale or otherwise. If anything, the “balance of the equities” that the City asks this Court to consider clearly favors Defendants.

D. Plaintiff City’s Motion to Toll the Statute is an Improper Attempt to Make an End Run Around the Requirements for a Preliminary Injunction.

This Court should also deny Plaintiff City’s Motion to Toll because it is an improper attempt to make an end run around Ohio’s requirements for obtaining injunctive relief. Under Ohio law, in order to obtain a preliminary injunction, a party must show that “(1) there is a substantial likelihood that the plaintiff will prevail on the merits, (2) the plaintiff will suffer irreparable injury if the injunction is not granted, (3) no third parties will be unjustifiably harmed if the injunction is granted, and (4) the public interest will be served by the injunction.”

Vineyard Christian Fellowship v. Anderson, 2015-Ohio-5083, 53 N.E.3d 910, at ¶ 11 (10th Dist.

2015). It must do so by “clear and convincing evidence.” Watson v. Caldwell Hotel, LLC, 2017Ohio-4007, 91 N.E.3d 179, at ¶ 35 (7th Dist. 2017).

The Motion to Toll meets none of those requirements, yet the City uses it to ask this Court to hold Crew SC hostage for the pendency of this litigation. Doing so would give the City exactly that which it seeks in its second Claim for Relief: an “injunction barring PSV and MLS from moving the Crew from Columbus . . . absent compliance with R.C. 9.67” (Compl. ¶ Claim for Relief)—but without requiring the City to make any of the required showings explained above. The Court should not permit the City to make a transparent end run around Ohio’s preliminary injunction requirements by inappropriately tolling the notice period in R.C. 9.67.

Any relief as severe as an injunction must be justified, and the City has not made (and cannot make) the necessary showings. The Motion to Toll should be denied for this reason as well.

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CONCLUSION For the reasons set forth above, Plaintiff City’s Motion to Toll should be denied with prejudice.

Respectfully submitted, /s/ Dan L. Cvetanovich Dan L. Cvetanovich (0021980) James G. Ryan (0030274) BAILEY CAVALIERI LLC One Columbus 10 West Broad Street, Suite 2100 Columbus, Ohio 43215 Tel: (614) 221-3155 E-mail: dcvetanovich@baileycav.com jryan@baileycav.com

/s/ Marc J. Kessler Marc J. Kessler (0059236) Jeffrey A. Yeager (0068062) HAHN LOESER & PARKS LLP 65 East State Street, Suite 1400 Columbus, Ohio 43215 Tel: (614) 233-5168 E-mail: mkessler@hahnlaw.com jyeager@hahnlaw.com Bradley I. Ruskin (OH PHV 19163-2018) Mark D. Harris (pro hac vice pending) Jennifer E. Tarr (OH PHV 19164-2018) PROSKAUER ROSE LLP 11 Times Square New York, New York 10036 Tel: (212) 969-3000 E-mail: bruskin@proskauer.com mharris@proskauer.com jtarr@proskauer.com

Attorneys for Defendants Precourt Sports Ventures, LLC, Team Columbus Soccer, LLC, and Crew Soccer Stadium Limited Liability Company

Attorneys for Defendant Major League Soccer, L.L.C. CERTIFICATE OF SERVICE I hereby certify that the foregoing Memorandum in Opposition to Plaintiff City’s Motion to Toll R.C. 9.67’s Six-Month Notice Period was served on all parties on April 23, 2018 via the Court’s electronic filing system. /s/ Marc J. Kessler Marc J. Kessler

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FOR IMMEDIATE RELEASE Monday, April 9, 2018 Contact: Meredith Tucker, 614-965-0203 (cell) Email: mctucker@columbus.gov

Columbus City Attorney Zach Klein Takes Action in Lawsuit to Keep The Crew in Columbus COLUMBUS, OH— Today, Monday, April 9th, 2018, Columbus City Attorney Zach Klein filed a motion asking the Court for an order to toll, or pause, the six-month time period for a local investor to purchase the team, as outlined in the Ohio Revised Code Section 9.67. This move seeks to protect the investment of the people of Ohio by enforcing state law, which requires a reasonable opportunity for local investors to purchase the Columbus Crew SC Soccer team.

“This tactic enables us to pause the six-month time period as outlined in the law in order to protect investments by the people of Ohio,” said Columbus City Attorney Zach Klein. “This will allow the City of Columbus to ensure that local investors in fact have the opportunity to purchase the team. We remain committed to doing everything we can to keep The Crew here in Columbus.”

A copy of the motion to toll can be viewed here. ###

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Crew SC | Major League Soccer officials have met with potential local investors

Sports

Crew SC | Major League Soccer o cials have met with potential local investors

By Andrew Erickson The Columbus Dispatch Posted Apr 19, 2018 at 5:26 PM Updated Apr 20, 2018 at 12:32 AM

Major League Soccer officials, including deputy commissioner Mark Abbott, were in Columbus last month to meet with Columbus Partnership CEO Alex Fischer and potential local investors for Columbus Crew SC, Abbott and Fischer told The Dispatch on Thursday.

The meeting also included a review of potential local stadium sites for the team, which has played at Mapfre Stadium on the state fairgrounds since 1999.

Fischer and Abbott declined to name the investors or identify the stadium sites.

“It was a productive meeting,” Abbott said.

Fischer and Abbott did not elaborate on next steps between the league, Columbus officials and potential Crew investors. Precourt Sports Ventures, which operates the Crew, has been exploring a move to Austin, Texas, since October, with a lack of a plan to replace Mapfre Stadium as one of its chief reasons.

The only public mention of possible new stadium sites in Columbus came Nov. 29 in a letter signed by Fischer and Columbus Mayor Andrew J. Ginther recapping their Nov. 15 meeting in New York with MLS commissioner Don Garber and Crew investor-operator Anthony Precourt.

In the letter, Ginther and Fischer said they shared Berliner Park, Dodge Recreation Center and a redevelopment of the fairgrounds as possible locations for a stadium. They also floated the idea of “feasible privately-owned spaces

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Crew SC | Major League Soccer officials have met with potential local investors

Downtown” that might work in creating a “stadium central” with Nationwide Arena and Huntington Park.

Garber made an appearance at an Associated Press Sports Editors meeting in New York on Thursday and said he feels for the Crew’s small but passionate fan base amid the team’s potential relocation next season.

Fischer said Thursday he thinks Abbott has been a “great liaison” for Garber in discussions with Columbus.

“We’ve had very constructive meetings, and we intend to continue private conversations,” Fischer said.

Those conversations continue amid a public lawsuit over the effort to move the team.

Ohio Attorney General Mike DeWine and Columbus City Attorney Zach Klein filed suit last month against Precourt Sports Ventures and the MLS arguing noncompliance with Ohio Revised Code 9.67, also known as the Art Modell Law, which requires a professional sports franchise receiving public benefit or playing most of its home games at a tax-supported facility to either receive permission or provide six months’ notice before moving. In addition, locals must be given the opportunity to purchase the team, the law states.

Thursday was the agreed deadline for counsel representing Precourt Sports Ventures and MLS to respond to the lawsuit. Attorneys indicated they would file a motion to dismiss, arguing that not only does the Modell Law not apply to the Crew but it is in violation of both the U.S. and Ohio constitutions. A ruling on such a motion is not expected for several weeks.

Ginther recently wrote an open letter to Precourt in which he said Fischer and potential investors would like access to the team and league’s financial information in order to make an offer to purchase the team. MLS attorney Marc Kessler has indicated they would be agreeable to doing so provided potential investors signed a nondisclosure agreement.

In Austin, Precourt Sports Ventures has requested a piece of city-owned land on which to build a stadium and has narrowed its search to McKalla Place, a 24-acre property in north Austin. The city council has asked the city manager to http://www.dispatch.com/sports/20180419/crew-sc--major-league-soccer-officials-have-met-with-potential-local-investors

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Crew SC | Major League Soccer ofďŹ cials have met with potential local investors

complete a site analysis by June 1.

aerickson@dispatch.com @AEricksonCD

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From: To: Cc:

Subject: Date: Attachments:

Bridget E. Coontz Marc J. Kessler; Dan L. Cvetanovich (dcvetanovich@baileycav.com) Randall W. Knutti; Samuel C. Peterson; "jtcox@columbus.gov"; Campisano, Charles P. (CPCAMPISANO@columbus.gov); "DCampbell@BRICKER.COM"; Warnock, Matthew (MWarnock@bricker.com); bsmeenk@bricker.com; Jeffrey Yeager RE: State of Ohio ex rel. DeWine, et al. v. PSV, LLC, et al.

Thursday, April 12, 2018 2:51:28 PM

Good Afternoon Marc: Thank you for getting back to me today in response to my email of April 5, 2018. As Randy indicated in his March 28, 2018 email, neither the State nor the City will agree to a stay of discovery.

Although we are encouraged to hear that the Defendants are prepared to provide financial information to prospective offerors, discovery is still necessary in this case for the Court to determine whether the Defendants have complied with § 9.67. Finally, we understand that absent our agreement you will seek a stay of discovery from the Court and are prepared to respond accordingly.

Thanks again for your email and I will have Randy get in touch with you regarding the status conference.

Thanks, Bridget Bridget C. Coontz Assistant Chief â&#x20AC;&#x201C; Constitutional Offices Section Office of Ohio Attorney General Mike DeWine Office number: 614-728-2035 Fax number: 866-914-1621 Bridget.Coontz@OhioAttorneyGeneral.gov

Confidentiality Notice: This message is intended for use only by the individual or entity to whom or which it is addressed and may contain information that is privileged, confidential and/or otherwise exempt from disclosure under applicable law. If the reader of this message is not the intended recipient, or the employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please notify me immediately by telephone.

From: Marc J. Kessler [mailto:mkessler@hahnlaw.com] Sent: Thursday, April 12, 2018 12:54 PM To: Bridget E. Coontz; Dan L. Cvetanovich (dcvetanovich@baileycav.com) Cc: Randall W. Knutti; Samuel C. Peterson; 'jtcox@columbus.gov'; Campisano, Charles P. (CPCAMPISANO@columbus.gov); 'DCampbell@BRICKER.COM'; Warnock, Matthew (MWarnock@bricker.com); bsmeenk@bricker.com; Jeffrey Yeager Subject: RE: State of Ohio ex rel. DeWine, et al. v. PSV, LLC, et al.

Bridget:

Please accept this correspondence in response to your email of April 5, 2018 and to confirm our previous meet and confer with Randy Knutti on March 28, 2018 whereby we requested a stay of discovery for all Defendants pending the Court having an opportunity to address the sole issue in the case—the applicability and enforceability of Ohio Rev. Code §9.67. We genuinely appreciated the State’s consideration (identified in Randy Knutti’s email of March 28, 2018) to narrow certain requests as overly broad, with the exception of financial information requested therein. However, it is still our position that discovery is patently unnecessary to determine whether the statute at issue may be applied, which would dispose of the case. Staying discovery at this time is appropriate and shall significantly conserve all parties’ resources pending the Court’s review. Moreover, if this were not enough, discovery simply does not advance the proceedings or assist in a resolution.

In further addressing Randy’s email of the 28th of March, to the extent that the State’s concern is that potential private parties be provided an opportunity to have access to financial information in connection with a potential offer to purchase Precourt Sports Ventures LLC’s interest in Team Columbus Soccer, L.L.C. and the rights to operate Crew SC, please be advised that we are prepared to provide pertinent information to bona fide offerors, subject to an appropriate Non-Disclosure Agreement (NDA). We intend to seek to move forward with that process. In any event, discovery is not the appropriate means by which to proceed with any proposed due diligence.

In light of the forgoing, please advise whether you will agree to a stay of discovery pending the Court’s review of the statute. Should we not hear from you, we will understand that there is no need for an additional meet and confer, and we will plan on timely seeking the assistance of the Court. We have also previously addressed scheduling a status conference with the Court. Please have Randy call me so that we may contact the Court along with Dan Cvetanovich and the City.

Thank you in advance and we appreciate your continued assistance and professionalism.

Marc J. KESSLER | Hahn Loeser & Parks LLP Tel: 614.233.5168 | Fax: 614.221.5909 mkessler@hahnlaw.com | hahnlaw.com 65 East State Street, Suite 1400, Columbus, OH 43215 Hahn Loeser & Parks LLP is a full-service law firm with a national footprint and international reach, with offices in Cleveland, Columbus, Naples, Fort Myers, San Diego and Chicago.

This email may contain information that is confidential or privileged, and it is intended only for the addressee(s).

If you are not the intended recipient, you are prohibited from using, copying, or distributing this email, its contents, or any attachment.

From: Bridget E. Coontz [mailto:bridget.coontz@ohioattorneygeneral.gov] Sent: Thursday, April 05, 2018 3:30 PM To: Dan L. Cvetanovich (dcvetanovich@baileycav.com); Marc J. Kessler Cc: Randall W. Knutti; Samuel C. Peterson; 'jtcox@columbus.gov'; Campisano, Charles P. (CPCAMPISANO@columbus.gov); 'DCampbell@BRICKER.COM'; Warnock, Matthew (MWarnock@bricker.com); bsmeenk@bricker.com Subject: State of Ohio ex rel. DeWine, et al. v. PSV, LLC, et al.

Dear Counsel: In anticipation of receiving your production of documents next week, attached please find a draft protective order. Although the State does not want or need a protective order we understand that your clients might seek one and we could go along with the attached should you need such assurances. We send this to you now in the interest of efficiently handling any such concerns and to keep the discovery in this case moving. Please let us know at your earliest convenience if you would like to enter into an agreed order such as the attached or if you would like to make any proposed edits or revisions. We remain available to discuss at your convenience.

Thank you, Bridget Coontz Bridget C. Coontz Assistant Chief â&#x20AC;&#x201C; Constitutional Offices Section Office of Ohio Attorney General Mike DeWine Office number: 614-728-2035 Fax number: 866-914-1621 Bridget.Coontz@OhioAttorneyGeneral.gov

Confidentiality Notice: This message is intended for use only by the individual or entity to whom or which it is addressed and may contain information that is privileged, confidential and/or otherwise exempt from disclosure under applicable law. If the reader of this message is not the intended recipient, or the employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please notify me immediately by telephone.