A United States Bankruptcy Court judge in Delaware on Monday denied the Dallas Stars’ bid to reopen the franchise’s 2011 bankruptcy case, dealing the NHL team an early loss in its larger legal dispute against the NBA’s Dallas Mavericks.
Whether Monday’s setback in Delaware has any effect on the dueling October lawsuits the teams filed against one another in Texas Business Court remains to be seen.
The bottom line in Monday’s Delaware hearing is judge Karen B. Owens, in denying the Stars’ motion to reopen the bankruptcy case, stated, “Texas Business Court can determine these issues in the ordinary course of business … I think you’re best to focus your attention in Texas.”
Attorneys for both franchises now will return their focus to Texas Business Court in Dallas, starting with a Jan. 22 virtual hearing. A jury trial has been scheduled for May 11, but four prior hearings could determine whether the case makes it that far. A motion for a summary judgment hearing is scheduled for Jan. 26.
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The Stars did not immediately respond to requests for comment. The Mavericks’ lead attorney Charles “Chip” Babcock declined to comment.
The Mavericks are suing the Stars over an alleged breach of the team’s franchise agreement with the City of Dallas by relocating its headquarters outside city limits to Frisco in 2003. The Stars filed a countersuit and later accused the Mavericks of violating their own franchise agreement by changing their principal location to Las Vegas in 2024 during Mark Cuban’s sale of the team to Miriam Adelson and the Dumont family.
The Stars argued to Owens the Mavs were well-aware of their Frisco headquarters in 2011 and that the confirmation order of the bankruptcy case cleared them from any future objections to the terms agreed upon in that case.
Jim Lites, the Stars’ CEO for nearly a quarter of a century, testified in Delaware that he and then-Mavericks counterpart Terdema Ussery held numerous meetings in Frisco during the first decade-plus of the 2000s, an indication that the Mavericks knew the Stars weren’t headquartered in Dallas.
“We’re asking you to enforce your confirmation order but, obviously, before you can do that you have to reopen the bankruptcy case,” Stars legal counsel Annmarie Chiarello said in the hearing. “It’s clear this court can enforce its own order and always retains jurisdiction to do the same.”
The Mavs argued that the debtors in the bankruptcy case were not the same parties in the Texas Business Court lawsuit today — and the parties in this case did not receive notice of the bankruptcy.
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