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The Athletic: Arizona Coyotes Plagued By Finance Issues, Toxic Work Environment

By Steve Goldstein
Published: Thursday, February 18, 2021 - 1:02pm

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Arizona Coyotes Colorado Avalanche
Getty Images courtesy of the Arizona Coyotes
The Arizona Coyotes take a faceoff on Aug. 19, 2020, in Edmonton, Alberta, Canada.

STEVE GOLDSTEIN: The move of the Winnipeg Jets to Phoenix to become the Phoenix — now Arizona — Coyotes was met with great fanfare. As a community, the Valley was well on its way to having teams in all four major American sports leagues. But when we look at the last 25 years, there hasn't been much success on the ice, and that's mixed with a tremendous amount of uncertainty off it. Ownership groups have come and gone as the NHL tries to keep a foothold in the desert. In 2019, that unsteadiness at the top seemed to change when billionaire Alex Meruelo purchased the Coyotes. But as Katie Strang reported in the Athletic this week, worries about leadership and business practices are evident inside and outside the organization. So, Katie, you spoke with 50 or so current and former Coyotes employees and many expressed there's a toxic workplace. Was that the pattern that stood out most to you?

KATIE STRANG: Yeah, certainly the most, I think, disturbing and unsettling for me. You know, you have to remember that for people that work within an organization, there are some great perks to doing that. But it's also a lot of long hours. It's a lot of unorthodox, you know, work days. You know, sometimes people miss holidays with families. You know, there's a lot of late nights, early mornings, and a lot of it is done, sort of unglamorously. And, you know, I think one of the perks to working for a team is you do have that real sense of camaraderie and community and sort of shared collective purpose, right? And to see that erode so precipitously and to talk to so many people who really were having a hard time going to work and feeling happy about it and feeling as if they were, you know, valued and treated well, you know, that, that was really disturbing for me to hear. It is just sort of the depth and the magnitude of, you know, people's unhappiness.

GOLDSTEIN: You wrote about Alex Meruelo's initial press conference, which got people fired up and as you mentioned, T-shirts were made of it and people were really excited. And I guess, I wonder, did that come up in talking to employees who were thinking there was reason for optimism and then maybe pretty soon after there wasn't?

STRANG: Definitely. You know, I mean, you reference like, that the organization has always been sort of fighting this, you know, pall of potential, you know, relocation and the lack of continuity among ownership and sort of lack of long-term financial stability. And here comes this guy with very deep pockets and charisma and energy and passion toward building a Stanley Cup-winning team both on and off the ice. So I think there was, you know, a really deep sense of buoyed hope and optimism. And, you know, I think once they started to see some of the philosophical organizing principles of his ownership put into place and executed and implemented, I think people started to step back and say, "Maybe this is not exactly what we expected."

GOLDSTEIN: If there is a general feeling, what is it about Alex Meruelo, considering you write as well about how he had tried to buy the NBA's Atlanta Hawks and that had not worked out. And the NHL has been, we know it from being here, Gary Bettman definitely wants there to be a team in the Phoenix area — no question about that. When it comes to this new ownership group, was the NHL just eager to get someone who, again, seemed to have a lot of money and this is a market they want to, to see thrive? Were there things maybe they should have looked at that they didn't?

STRANG: That's hard for me to speak on with any degree of specificity. I can tell you this: I do believe that the NHL is very staunch in its commitment to seeing hockey thrive in the desert — which I think it can, and I think there's a lot of people in Arizona that know it can and believe and are committed to seeing that work. But in terms of the vetting process, I did do quite a bit of reporting on, you know, what, what the League would look into and sort of how it would conduct those processes and, and checks and balances. And I talked to a former NHL owner to kind of lay out the scenario of, you know, "Hey, how thorough is this?" And the former owner told me like that he was almost astounded by the level of thoroughness and that he had had an incident probably like decades prior, which was something, you know, not terribly serious, but slightly, you know, something that I think he was embarrassed about — it might have been a verbal altercation or something like that — and that it got brought up to him before he received Board of [Governors] approval. And that showed to him the level of thoroughness, that they vetted him. I've had some people speculate to me that because Meruelo, you know, has such an expansive business portfolio and the fact that, you know, he has, you know, owned a bank and obviously a couple of casinos, that, you know, there are certain checks and balances that are required for those that, you know, maybe it's possible that the League sort of, you know, looked at those and assumed that he'd check out, right? Like, in order to get a gaming license, you have to meet certain rigors and thresholds. So, but for me to be able to speak on this definitively, I can't. You know, I did request the NHL's comment multiple times before the story ran. And I will tell you that one of the specific questions I posed to them is whether they were willing to share any details of their vetting process, and they declined to comment multiple times.

GOLDSTEIN: Is there any way to, to figure out whether some of these issues that you and I have talked about are related to new ownership group getting its footing, new ownership group dealing with a global pandemic, all sorts of things. Anything in the report that would indicate maybe some of these problems wouldn't be problems if the world hadn't sort of got overturned? Let's put it that way.

STRANG: So here's what I will say. I do think, you know, I certainly try to, you know, report with a great degree of nuance in context, and in doing so, you know, definitely made that a feature of my reporting is to ask people, you know, "How much of this do you think was impacted by [COVID-19] and the pandemic and some of the economic implications? And how much of this was a preexisting feature of the organization?" The general sense that I got was that a lot of this stuff was likely exacerbated by the pandemic, but it was stressed to me over and over that this was very much a feature of the business long before [COVID-19]. It not only predated the pandemic with the Coyotes, but that a lot of these business practices that were called into question and raised to my attention also surfaced in my reporting, you know, in, with people that had dealt with him in other business enterprises in previous years.

GOLDSTEIN: We'll stop there. That is Katie Strang. She's a senior reporter for the Athletic. We've been talking about her investigative, in-depth piece on concerns with the Arizona Coyotes. Katie, thank you so much.

STRANG: Of course. Thanks for having me.

GOLDSTEIN: And the Coyotes issued a statement after Strang's piece was published. In part, it reads, quote, "We question the potential reliance by the Athletic on disgruntled ex-employees who've proven to be untrustworthy and lacking in candor on confidential, non-public information," end quote.

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