{"id":724149,"date":"2026-06-25T01:04:10","date_gmt":"2026-06-25T01:04:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/724149\/"},"modified":"2026-06-25T01:04:10","modified_gmt":"2026-06-25T01:04:10","slug":"new-details-emerge-in-lawsuit-against-sky-owner-michael-alter","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/724149\/","title":{"rendered":"New details emerge in lawsuit against Sky owner Michael Alter"},"content":{"rendered":"

The unredacted versions of the complaint against Sky<\/a> principal owner Michael Alter, as well as his motion to dismiss, have been unsealed, drawing the dispute into sharper focus.<\/p>\n

Minority investor Steven Rogers sued Alter in January, accusing him of breaching the team\u2019s operating agreement and violating his fiduciary duty to investors. Alter filed a motion to dismiss the case in April, arguing Alter\u2019s actions were permissible and that Rogers does not have standing to bring some of his claims. <\/p>\n

Both filings were previously heavily redacted, leaving the details of the dispute unclear.<\/p>\n

At the heart of the case is Alter\u2019s decision to convert his longstanding loans, which covered the team\u2019s losses for decades, into equity ownership. The two sides differ on whether that conversion was authorized and done in good faith. <\/p>\n

Rogers alleges in the complaint that the conversion unfairly transferred value from minority investors to Alter. In his telling, Alter used his control of the company to look out for himself.<\/p>\n

Alter\u2019s defense, laid out in his motion to dismiss, is that the conversion was actually beneficial to all investors. Without the move to improve the balance sheet, his attorneys argue, the Sky would not have been able to raise capital in 2023.<\/p>\n

The two sides also differ on whether the conversion was allowed under the operating agreement. Rogers\u2019 complaint cites one section of the operating agreement to argue it was prohibited. Alter\u2019s motion to dismiss cites another to argue it was expressly authorized.<\/p>\n

The secondary argument is about the conversion price.<\/p>\n

Alter had loaned the team about $29 million to keep it afloat over the course of its history, according to court documents. He did so on what appear to be lenient terms: The loans had only a 1% interest rate and did not have a specific maturity date by which the team was obligated to pay him back.<\/p>\n

Then, in 2022, Alter brought in new investors at an $85 million valuation. He converted his loans at face value, at the same valuation as new investors, meaning the roughly $29 million of principal and interest turned into an additional 34% ownership stake.<\/p>\n

Rogers argues that was unfair because, in his view, the market value of the loans was far lower than $29 million. His argument is that a loan with no guaranteed repayment date has limited value. So, in Rogers\u2019 view, the loans should have converted into a much smaller stake in the team.<\/p>\n

The defense argues the opposite: that under Delaware law, loans without a maturity date are repayable on demand. And a loan the borrower has to repay at the snap of the lender\u2019s fingers may indeed be worth face value.<\/p>\n

This aspect of the dispute is tedious, but it feeds into a more interesting question.<\/p>\n

What should Alter\u2019s financial contribution during the years when the Sky might have failed without it actually be worth now that the league is booming? What is the fairest split of the spoils?<\/p>\n

The unredacted complaint also makes Rogers\u2019 allegation that Alter has a history of sloppy management more vivid.<\/p>\n

Rogers alleges Alter failed to properly document the loans, track capital contributions and investors\u2019 ownership percentages.<\/p>\n

He cites a 2022 notice that Rogers\u2019 stake had been diluted from 2% to 0.08%, which Rogers called \u201cwildly inaccurate.\u201d Alter eventually acknowledged that figure was wrong and revised Rogers\u2019 stake to 0.867%, according to the complaint.<\/p>\n

Rogers also makes what appears to be a separate but related allegation involving a 2010 agreement with the WNBA.<\/p>\n

According to the complaint, the WNBA loaned the Sky $9 million for the team\u2019s initial license fee. Rogers alleges Alter \u201cwanted to get paid ahead of the WNBA,\u201d so he represented to the league that he had loaned funds to the Sky at 12% interest with a 2014 maturity date.<\/p>\n

The WNBA did not respond to a request for comment. Alter\u2019s motion to dismiss does not directly address those specific allegations.<\/p>\n

But the motion does heavily dispute the characterization of mismanagement and argues that Rogers\u2019 complaint is a vindictive attempt to smear Alter.<\/p>\n

It also includes signed declarations of support from 20 investors, described by Alter\u2019s attorneys as \u201cnearly all\u201d of the investors in Chicago Women\u2019s Basketball Investments, who said they view the lawsuit as baseless and harmful. Their statements say Alter has run the business professionally and that investors were aware he was converting his loans into equity.<\/p>\n

One of those signees, Linda Friedman, spoke to the Sun-Times in February<\/a>. She defended Alter vehemently, saying she was angry about the lawsuit and considered it revisionist history.<\/p>\n

Friedman approved of the dilution of her shares after the conversion and felt communication around her stake had been regular and transparent.<\/p>\n

She also said she believed Alter\u2019s intention in raising capital was to benefit the league as a whole: to boost the valuation of the Sky, lift all teams and increase the buy-in price for expansion franchises.<\/p>\n

Alter\u2019s attorney, Robert Chapman, has called the complaint meritless and said neither Alter nor the Sky would comment further. After the court ordered the documents unsealed, Chapman told the Sun-Times the decision \u201cdoes not concern us or affect the merits of this case,\u201d adding that Alter\u2019s side remains confident \u201cthe outcome will vindicate the propriety of our clients\u2019 actions.\u201d<\/p>\n

What happens next?<\/p>\n

Rogers\u2019 counsel filed a motion asking the court to delay briefing on Alter\u2019s motion to dismiss and allow discovery into the 20 investor declarations filed in support of Alter. They want to test investor statements through depositions, arguing they are cookie-cutter.<\/p>\n

Rogers\u2019 motion states that the declarations represent \u201csome but not all\u201d of the minority investors. His counsel declined to say how many minority investors there are in total.<\/p>\n

Alter\u2019s attorneys oppose the request. They argue the court should first rule on the legal sufficiency of Rogers\u2019 complaint, because those issues do not require discovery. They also argue Rogers has not identified the specific facts he expects to uncover and characterize the request as an improper fishing expedition.<\/p>\n

Should fans even care?<\/p>\n

For Sky fans suffering through another unfortunate season, whether Alter eventually owes damages to his partners is probably not top of mind.<\/p>\n

But the lawsuit does reinforce questions about whether the Sky\u2019s ownership group is equipped to compete in this era of the WNBA.<\/a><\/p>\n

The league is expanding, with deep-pocketed franchises in Golden State, Portland and Toronto already here and three more teams on the way starting in 2028.<\/p>\n

The Sky still need to prove they execute now that they are running a significantly larger business very much in the public eye.<\/p>\n

The team\u2019s long-awaited practice facility in Bedford Park \u2014 now a tablestakes investment for WNBA franchises \u2014 is one place to watch.<\/p>\n

Ownership first said it would be completed by the end of 2025, then by the start of the 2026 season, then by \u201clate spring\/early summer.\u201d<\/a> The Sky are now one month from hosting All-Star weekend \u2014 where they said they would host events at the new facility \u2014 and still have not announced an opening date or explained the latest delay.<\/p>\n

The communication gap is not flattering. Portland, the Sky\u2019s opponent Wednesday night, announced in late May that its practice facility would open Aug. 22.<\/p>\n

The Sky\u2019s facility is expected to open at some point. When it does, it will be a meaningful achievement for a franchise that badly needs one.<\/p>\n

But the shifting timeline raises the question: As expectations for WNBA ownership rise, is the Sky\u2019s group evolving fast enough?<\/p>\n","protected":false},"excerpt":{"rendered":"The unredacted versions of the complaint against Sky principal owner Michael Alter, as well as his motion to…\n","protected":false},"author":2,"featured_media":724150,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[73],"tags":[99,434],"class_list":["post-724149","post","type-post","status-publish","format-standard","has-post-thumbnail","category-wnba","tag-sports","tag-wnba"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/724149","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=724149"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/724149\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/724150"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=724149"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=724149"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=724149"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}