Per Meg Linehan of Excelle Sports, the reported lawsuit investor Michael Moran was to file against the NWHL was filed today, April 27, in United States District Court, in the District of Massachusetts. Rylan, the NWHL Foundation, NWHL Group and NWHL Holdings were named in the lawsuit, which has climbed from an estimated $200,000 to approximately $650,000.
In the suit Moran and his attorneys allege Rylan and the league’s actions “constitute unfair and deceptive business practices.”
Per the report:
Moran’s lawsuit demands $200,000 for breach of contract. Under Massachusetts General Laws Chapter 93A, Moran is seeking treble damages plus attorney fees. In addition, there is a separate cause for what is called quantum meruit—Moran is seeking $50,000 for the services he performed as Chief Marketing Officer for the NWHL from February 2015 to October 2015.
Thanks to the filing of the lawsuit in Massachusetts district court, the total amount has climbed drastically from Moran’s demand of $184,971.10 made in his letter dated March 24, 2016.
The Associated Press received further details about Moran’s suit. From the article:
As part of the suit, Moran is also seeking to be paid roughly $50,000 in salary for eight months work as a league executive. Moran said he did not receive a salary while other league officials, including Rylan, were paid between $80,000 and $90,000 a year.
Moran said he agreed to provide the NHWL seed money when he and Rylan first discussed forming the NWHL in 2013. Upon launching the league last year, Moran said the two agreed that he would have a 40 percent share of NWHL profits and Rylan would have 60 percent.
Moran acknowledges in the suit that the agreement was never put in writing “because Moran and Rylan were friends and had been friends for years.”
The dispute over Moran’s stake began when he said he discovered an email Rylan had sent to another individual indicating Moran had only a two-percent share.
Verbal agreements are considered just as binding as written contracts. The Law Dictionary states that “verbal agreements and oral contracts are generally valid and legally binding as long as they are reasonable, equitable, conscionable and made in good faith. Although most people associate contracts with legal documents printed on paper for the purpose of getting them signed and stamped by notaries, the fact is that only a few types of contracts are required by statute to be written.” As such, Moran’s claims to 40 percent of the NWHL’s profits may not be easily disproven by the NWHL.
The NWHL responded to request for comment by the AP, calling Moran’s lawsuit “frivolous and personal.”
“The intentions of the individual who filed it were never about business or recouping finances, but a malicious attack to undermine Dani Rylan and the work of many behind the scenes,” the league said. The AP indicated the NWHL will provide a further response in legal documents being prepared by its attorneys.
This is potentially devastating for the fledgling league. As Linehan calculated, the amount Moran is asking for is equal to approximately two 17-player teams, which could either bring potential expansion plans to a grinding halt or slash the league from a meager four teams to an unworkable set of two.
The league is currently in their “restricted free agency period” which began on April 1, and will last until April 30. While each team has had players re-sign for next season, several key players, including members of the US National Team have yet to ink new contracts. It’s quite possible this lawsuit scares off some cautious players.