MANHATTAN (CN) - The owner of the New York Islanders hockey team backed out on a deal to sell the NHL team for $420 million, the frustrated buyer claims in a lawsuit that wants the sale to go through - or at least the $10 million breakup fee.
NY ICE LLC sued Charles Wang and his CBW/SK Sports Ventures, on Monday in New York State Supreme Court.
NY ICE, a Delaware corporation based in Radnor, Pa., acknowledges in the lawsuit that the sale contract has not been "physically signed."
But it claims that after a March 10 meeting, "the parties intended that they be bound by the SPA [securities purchase agreement] notwithstanding that it had not yet been physically signed."
Wang made his fortune running Computer Associates. He bought part of the Islanders in 2000 and became full owner of the team in 2004.
NY ICE claims it worked out a 70-page securities purchase agreement with Wang, under which it would buy the team for $420 million.
But when L.A. Clippers owner Donald Sterling shot off his mouth and was forced to sell the team for a reported $2 billion, Wang had second thoughts and backed out of the deal, NY ICE says in the lawsuit.
As for the Islanders sale, NY ICE claims: "The parties met and reached an agreement and then shook their hands on the agreement."
Citing the $2 billion Clippers fiasco, NY ICE adds: "As the parties began to complete all conditions to closing the transaction, defendants, without notice, abruptly refused to proceed to close the transaction and honor the terms of the SPA. Instead, they improperly sought to renegotiate the already agreed upon price to be paid."
The complaint continues: "Notwithstanding his 'my word is my honor' mantra and the documents memorializing the agreement, Wang - contrary to his word - attempted to inflate the purchase price from the $420 million enterprise value that had been agreed upon in March 2014. This attempt to coerce NY ICE into inflating its purchase price, after having invested over nine months attempting to finalize the ownership transfer, was nothing more than bad faith on defendants' part, motivated solely by greed.
"Under the terms of the agreement, NY ICE is entitled to specific performance to force the sale of Islanders. Ownership of an NHL franchise is a unique property and the failure to follow through with the sale has caused NY Ice irreparable harm.
"Alternatively, NY ICE is entitled to the $10 million 'break up' fee to which the parties agreed. At the very least, NY ICE is entitled to recover its costs and losses suffered as a result of defendants' reneging on the agreement."
NY ICE is represented by Simon Miller with Blank Rome.