Suns and owner Ishbia sued by minority owners for access to team’s records

Kohlberg and Seldin’s representation on lawsuit against Suns:

“Our clients sued to obtain records to which they are entitled as minority owners of the Suns,” Michael Carlinsky and Michael Barlow of Quinn Quinn Emanuel, who are representing the minority owners. “They are concerned by the manager’s approach towards minority owners, and want more information about certain spending and capital raises in which the manager has engaged. Transparency with minority owners is not optional, and our clients think it is critical to the success of the Suns.”

The lawsuit was filed in Delaware on Aug. 21st but a redacted version became public on Wednesday. The document contains a complaint from Kohlberg and Seldin’s attorneys that Ishbia “may have entered into undisclosed side deals with other members of the [Suns],” which became relevant to them due to a capital call when Kohlberg was seeking a buyout from the team.

The speculation or rumor of the side deal was sparked with how the team was funding the Phoenix Mercury’s $100 million practice facility. Kohlberg and Seldin’s team claim that Ishbia refused to give information on the venture, only stating that “[It] complied with its duties under the LLC Agreement.”

Kohlberg and Seldin are seeking $825 million for their share of the team, which would bring the team’s valuation near $6 billion. The value assessment is a massive increase from when Ishbia bought the team back in 2023. The Suns and Ishbia’s attorneys released a statement on Tuesday addressing the claims by the minority owners.

“Make no mistake, [Ishbia] does not intend to reduce or slow its investments in the company and its teams. To the contrary, [Ishbia] will continue doing whatever it takes to position the Suns and Mercury to win championships, ensure a positive team culture, create a lasting impact on the greater Phoenix community, and improve the fan experience. [Ishbia] is not afraid to exceed the luxury tax line and make other commitments to ensure the Suns and Mercury remain first-in-class operations.

“If your clients do not share these same priorities, then perhaps they should try to sell consistent with the terms of the parties’ agreement. Instead, Kohlberg and Seldin have resorted to threatening baseless litigation and sensationalized press coverage as a means of intimidating and coercing [Ishbia] into unprincipled and unjustified buyout negotiations. That will not work. [Ishbia] and the [Suns] will not be bullied by these sharp and abusive tactics.”