Penguins Ex-Owner Might Owe $45M
PITTSBURGH (AP) _ A former owner of the Pittsburgh Penguins could owe the bankrupt team’s banks $45 million, according to documents filed in bankruptcy court.
Lawyers for current Penguins co-owner Roger Marino said the documents indicate that former co-owner Morris Belzberg guaranteed loans that banks made to the team.
``I think it’s a contract, and I think that the secured creditors are the beneficiaries of that contract,″ said Harry Manion III, one of Marino’s lawyers.
``Belzberg guaranteed to pay the shortfall,″ Manion added.
Belzberg is one of the original partners of Penguins co-owner Howard Baldwin and retains a stake in the team. He is not on the hook for the $45 million, said his lawyer, Steven Engberg.
``This was done for tax purposes,″ Engberg said.
Engberg said the only way Belzberg would be liable to repay the $45 million is if the Penguins were sold and the price fell short of the amount needed to pay off the loans.
The Penguins owe banks and insurance companies about $70 million, but the team is worth about $94 million, Engberg said.
Marino also has demanded that all partners invest an additional $600,000 or lose their investment in the team. Marino’s order gives Belzberg until Friday to make the additional investment.
Engberg said the bankruptcy filed last October puts a hold on such a demand.
``They didn’t have the right to do that,″ Engberg said.