Baseball Team Says League Walked With $200K
OMAHA (CN) - A now-defunct independent baseball league duped a company into paying a $200,000 franchise fee despite knowing the league would never have another season, the investor claims in court.
Fast Ball Sports LLC sued the Northern League Inc., all six of its member teams, and DC Sports and Entertainment LLC, in Douglas County Court.
According to the lawsuit, the league and its teams solicited Fast Ball Sports to join up in the fall of 2010, despite knowing the 2011 season would never happen.
Fast Ball Sports claims it signed a contract to begin league play in 2011 and paid a $10,000 application fee to the Metropolitan Entertainment and Convention Authority to use its TD Ameritrade Park for home games.
The complaint states: "In approximately late September of 2010, FBS paid the $200,000 franchise fee to the [Northern League] members, who, upon information and belief, divided the $200,000 amongst themselves and did not retain or use the money for any Northern League purposes. The members accepted and divided the $200,000 when they knew that the Northern League was not financially viable, was about to terminate, and would not play any games in 2011."
Fast Ball Sports says it received a letter claiming the 2011 schedule was being finalized and would be made available shortly, even though "the members were already meeting to discuss the termination of the Northern League and already knew that teams were planning to leave or had already left the Northern League. The members further knew that the franchise issued to FBS was worthless and that they had diverted the $200,000 paid by FBS."
Fast Ball Sports demands more than $1.1 million in damages for fraud, breach of contract and unjust enrichment.
In addition to the franchise fee, FBS says its other expenses included:
"$36,000.00 for franchise development;
"$288,000.00 for personnel and business development;
"$23,500.00 for brokerage fee;
"$300,000.00 to Fiji Sports Trust for intellectual property; and
"$297,000.00 in investment and operating expenses."
The co-defendant members of the Northern League include Fargo Baseball LLC, Schaumburg Professional Baseball LLC, Joliet Professional Baseball Club LLC, Southshore Baseball LLC, Kansas City T-Bones LLC and Winnipeg Goldeyes Baseball Club Inc.
Fast Ball Sports is represented by Jason Bruno, with Sherrets, Bruno and Vogt in Omaha.