Originally posted on Sports Business Digest  |  Last updated 5/31/12

Let's play a game. Let's pretend that you are Shahid Khan. Seven months ago, you spent $760M to purchase the Jacksonville Jaguars. The Jaguars. The NFL team that plays in the league's 3rd smallest market. The team that has had so many issues avoiding blacked out home games that former players and Jacksonville mayor Alvin Brown, himself, have been involved in door-to-door grassroots campaigns begging people to attend the games. The Jaguars. You are the least valuable NFL team according to Forbes, and even though you received a revenue boost thanks to a new NFL-ESPN television contract last year, you also had to convince the City of Jacksonville to not take a 25% cut on your stadium naming rights deal with EverBank because, well, you're trying to run a successful business (* technically, this happened before Khan became the owner, but you get the point). Since you've began your tenure as owner you've been doing things like: involving yourself in local philanthropic activities and pledging $1 million dollars to local initiatives, acting as a global ambassador for the City during your overseas business trips, and spending $3 million dollars of your own money to construct a state of the art locker room facility for the team. You've put a lot into this team in the last seven months. Your reward? The City, which owns EverBank Field, decided to kick you out of the building. But don't worry, once they realized that they actually broke the rules first and you worked with them in good faith anyways, then telling you were subsequently in default of a lease provision you had complied with, they withdrew the default notice. Did I mention that the default notice was concurrently sent to Jacksonville local media outlets which then ran the story, noting that the Jaguars were in a contract dispute with the city, leaving their status in flux? How are those season ticket sales going, Mr. Khan? This entire debacle started when the City of Jacksonville issued a request for proposals (RFP) for a facilities manager for EverBank Field -- a violation of the current lease agreement between the City and the Jaguars. The Jaguars, via letter to the City, noted the City's error, but agreed to work with them, in good faith, to find a new facilities manager. In the meantime, the Jags found a proposed vendor that based on other bids, would save the City $1 million dollars a year. And then things got out of hand,
Immediately upon our advising the City of our recommended selection, your lawyer delivered to the Jaguars organization a default letter putting in motion a termination of our lease. This default letter was published to the newspaper concurrently with delivery of the letter to the team. The result of the delivery of the letter to the newspaper was a front page headline stating that the Jaguars were in a contract dispute with the City. The timing of the headline from the City’s media activity could not have been timed worse for our ticket sales effort. The comments by City representatives and the story have created uncertainty and concern by our fan base. -- Shahid Khan letter to Mayor Alvin Brown
The problem with the default letter was that the Jags actually complied with the lease -- an addendum, agreed upon by both parties -- had been put in place but Jacksonville general counsel Cindy Laquidara was unaware of the addendum and decided to move forward with the default letter, which leaked to the public. That led to an incredible amount of back pedaling.
I have since determined that this was an error on my part; that my office had prepared an addendum to change the terms of the April 30, 2012 letter. I apologize for failing to stay informed on this matter and for erroneously informing you that the Jaguars had breached the term of the contract, and our agreement, as I understood it...In my rush to communicate, and lacking key information, and due to internal communications problems in this office, I advised you in error. -- Laquidara letter to Mayor Alvin Brown
In short, both parties met in April and decided that the new facilities manager would be mutually chosen between the two parties. Subsequently, an amendment to that process was made, allowing the Jaguars to concurrently and separately review all RFP submissions, then advise the city of their recommended selection. The City, meanwhile, would evaluate the proposals after they received the recommended proposal from the Jags. Laquidara was never informed of this amendment, and when she received the Jags recommended selection, she jumped the gun and went to terminate the lease. A phone call may have served her better. Once the mistake was realized, the default letter was rescinded, and everybody said the right things, but one has to wonder about Khan's feelings towards the City. Sure, you could chalk up this gaffe to a lawyer who was a bit overzealous...but, at the end of the day, you're still in a struggling NFL market, and while stadium discussions have slowed an NFL's team move to Los Angeles, the promise of a larger fan base and more easily tapped revenue is not easy to ignore. Especially when your current city incorrectly said you defaulted on your lease, leaked it to the local papers and exacerbated your subpar attendance issue even further. It's a mistake that while maybe forgiven, may not be easily forgotten. At least, not until the Jaguars open up their first home game in Los Angeles. h/t to Jacksonville Business Journal
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