Six day after news broke about a possible lawsuit against the National Women’s Hockey League, Mike Moran officially filed a suit in the US District Court in the District of Massachusetts yesterday seeking $650,000. The documents list Danielle Rylan, NWHL Foundation, Inc., NWHL Group, LLC and NWHL Holding LLC as defendants.
According to Excelle Sports, Moran is seeking $200,000 for breach of contract, tripled, as well as $50,000 in back pay for services rendered as Chief Marketing Officer between February and October 2015.
Moran alleges that he and Rylan agreed to a 40/60 percent split, respectively. However, no contract or written agreement exists because, as the court documents read, “Moran and Rylan were friends and had been friends for years.” The lawsuit continues that their relationship soured when Moran found out Rylan told another person with the league that he only had a 2 percent share.
Before we go too much farther in the lawsuit itself, how did we even get here in the first place? Let’s go back to the very beginning.
The NWHL was officially announced launched on April 8, 2015. But it seems we need to go back even farther to see the beginning of the Rylan/Moran saga:
The facts section of the lawsuit says the two started discussing the foundation of a league in 2013. According to an espnW interview with Rylan, she was talking to the Canadian Women’s Hockey League at the time (2014) about expanding to New York. Obviously those talks did not produce a new CWHL team but out came the NWHL, the first professional women’s hockey league to pay players.
According to the lawsuit, Moran would be “providing some seed money” and “pay mostly fixed, regularly occurring sums to Rylan as an investment in the league.” It continues to say “Initially, the pair agreed that these sums would be considered an investment in the league, which Rylan and Moran would each control and from which each might someday profit, as co-owners,” as well as “Rylan accepted payments for roughly two years and devoted much of her time to the league’s formation.”
Jump ahead two years, to February 2015, at which point the lawsuit documents say Moran began working as the Chief Marketing Officer. This begins the time period which Moran is seeking pay for, the $50,000 included in the suit. In a letter to US national players obtained by Excelle Sports from the initial reporting on the possible lawsuit, Moran was named the CMO.
Then came the official league launch on April 8, 2015. According to court documents, the pair agreed their share of the profit would be split 60/40: 40 percent to Moran, 60 percent to Rylan. Again, there was no written documents to confirm the deal.
The court documents say that Moran assisted financially in the launch party as well as web hosting and marketing, including Facebook. The web hosting is reportedly backed by a document obtained by Excelle Sports. Excelle Sports also has obtained documents reportedly totaling the Facebook advertising alone to a sum of $23,500.55.
In the court document is an email from June 14 – 15, 2015 between Moran and Rylan regarding what the league needed money for. Moran, who created the list sent to Rylan, lists everything from visas to ice time for pre-league camps to “some dani [sic] spending money ($5,000?)” Some budgets aren’t specified, listed instead as “TBD” and some have estimates that range in tens of thousands of dollars. But, assuming the high end of the estimates Rylan was seeking about $65,000 in mid-June.
Excelle Sports also received Bank of America statements that reportedly show “mobile/email transfers” to Danielle Rylan. They report that the transfers from 2015 add up to $28,140. They also have documentation that reportedly shows a wire transfer from Moran to the Foundation for $10,000 on May 1, 2015 and another for $35,000 on June 24, 2015. There are also checks that equal $4,000 included in those documents. In total, that’s about $77,140 that Moran sent to Rylan or the NWHL.
One important note is that the Foundation is not-for-profit. The NWHL website section on the Foundation reads, “The NWHL Foundation is a charitable and educational 501-(c)(3) nonprofit corporation that provides long-range financial support for the NWHL and promotes the growth of women’s hockey.” Moran donating high sums to the Foundation, based on that alone, makes sense. He is donating to provide “long-range financial support.” However, at this point he is still considered an investor, according to the court documentations on the proposed facts presented by Moran. The case may hinge on whether the money sent through the foundation is considered an investment, which would require payment back at some point, or a donation.
The league continues to grow, signing players throughout the summer and into the early fall leading right up to the pre-season games in the first week of October. Oct. 1, 2015 also marked the first paycheck period for players, though the court documents allege that almost didn’t happen. According to the documents filed, the league had to scramble to pull together all of the money. Nonetheless, the paychecks went out.
At some point around this time, though not specified in the court documents, Rylan and Moran’s relationship went “sour.” Moran found out Rylan had emailed another person affiliated with the league stating that Moran only had a 2 percent stake in the league, as opposed to the 40 percent he claims to have originally thought.
Moran also started to see “disorganization” in the league. The court documents say that these factored into Moran and Rylan supposedly making a new agreement, again not in writing. The pair agreed that Moran would no longer be involved with the league, would no longer be an investor and his money would be returned to him. An repayment plan was to be set with the pair, the league’s legal counsel, and George Speirs, who was at the time the Chief of Operations of the league.
According to a profile on Speirs, he gave money to the league. In the profile on Today’s Slapshot, he said he chose to “donate to the league’s operations” and saw himself a donor rather than an investor as he was not looking for a return on his money.
Amid all of this, one of the four teams had some front office troubles of their own. On Dec. 24, 2015, the Connecticut Whale’s general manager resigned suddenly. Speirs, still COO, was appointed interim general manager. Nearly a month later, the Whale’s head coach also resigned. Before the GM’s resignation the team was undefeated and the hottest team in the league. The Whale’s front office saga continued when, on Feb. 10, Speirs was out as both GM and COO.
This came on the heels of another splash involving the Whale and the league, though this time focused on a player and her father. On Feb. 9, espnW reported that the one of the investors in the league was Joel Leonoff, the father of Jaime Leonoff, the Whale’s main goaltender.
According to the court documents, with Speirs out, the discussions to repay Moran came to a halt, as did all communication between Moran and the league.
At the same time, Buffalo Beauts forward Kelley Steadman tweeted on Feb. 17 about having no more Bauer sticks. This was followed by a tweet that has since been removed by Boston Pride practice player Cherie Hendrickson on how her and her teammates never received their Bauer equipment. According to a Today’s Slapshot article, the league was responsible for buying equipment to provide to the players from Bauer, and the players could buy their own sticks from the company or use ones provided by BASE. At the time, the league released a statement on behalf of itself and Bauer. Rylan said that while they had indeed missed a payment to Bauer, they had remedied the situation.
The rest of the season continued on, and the Boston Pride won the inaugural Isobel Cup championship on March 12. At the very end of their live stream of the game, a cryptic graphic ran on NWHL Cross Ice Pass. The four current teams popped up on a map with two Canadian flags dropping in locations that appeared to be in the Toronto and Montreal area. The league has offered no explanation on this, but connecting the dots to expansion isn’t difficult.
With the offseason only four days old, more controversy appeared when some members of the media received an anonymous email from someone who claimed to be an employee of the league, alleging that the league cannot pay any of its bills, not just the Bauer bills that were previously cleared up by the NWHL. The email included leaked emails from the league and Bauer from December 2015 and January 2016. None of the new allegations were cleared up, though they are slightly baseless anonymous claims.
All seemed quiet for the next five weeks. The league announced the second season’s salary cap and free agency periods. Then the first reports of a possible lawsuit came on April 21, reported by Excelle. To rehash last week’s news, on March 24, Moran’s lawyer sent a final collection notice to the league looking for $184,971.10 of his investment back. If no action was taken by April 22 at 5 p.m. ET, Moran would move to court.
At the same time, an unnamed player questioned Rylan’s qualifications and actions, going so far as to suggest that some of her actions as commissioner could possibly land her in jail.
At that time the league released a statement calling Moran a “volunteer” in the early stages. The statement reads, “Mike Moran was a volunteer in the early stages of the NWHL’s existence and at no point was a formal investor. While we and our legal team are not aware of any current legal action against us, any future action will be handled by our lawyers and not through the media.”
It took six days for the case to be filed in court, which is where we stand now. As of April 28 at 11:30 p.m. ET, the league has also been issued its summons.
Where This Leaves Us
With no written agreements, it seems like the case turns into a he-said-she-said situation. The lawsuit says that there is precedent for a verbal agreement to be considered a binding contract.
A glaring difference is the language used to describe Moran’s involvement. Moran alleges in his court documents that his role was agreed upon as an investor and that the money was to be a loan. He claims Rylan agreed to this. However, in the response to the possible suit last week, the league makes it a point to say he was not an investor. This could be a key to the case, as well as the fact that he gave money to the Foundation as well as Rylan herself. Because the Foundation accepts donations, any money sent to the NWHL Foundation shouldn’t be seen as an investment.
If the case does go to court and the judge rules on the side of the Rylan, the sum is extremely large. Consider each team has a salary for players of $270,000. Moran’s requested sum is 2.4 times. This could put not only the possible expansion into question, but also the league itself.
Taking the money completely out of the equation, the suit still isn’t good press for the league. Dunkin’ Donuts is the only major sponsor they have. Bauer has a partnership with the league for equipment. The partnership has already had money issues in the past. How this will impact those relationships remains to be seen.
The unnamed player speaking out about Rylan’s management is also troubling. Thus far, the turmoil in the league had only been seen in the front offices. With a player publicly voicing her concerns, it shows the discontent running deeper, and it’s highly unlikely with dozens of other players in the league that this individual is alone in her opinion.
With these next steps, some questions were answered, some were left unanswered and new ones arose.