Tom Hicks and RBS back in Court

February 23, 2011,  ESPN.com

Ray Evernham has filed a lawsuit seeking $19.3 millon from the man who purchased the majority interest of Evernham Motorsports from him in 2007.

The suit, filed on Tuesday in North Carolina Superior Court in Mecklenburg County, was filed against Booth Creek Management and Gillett GEMS, LLC for money not paid in the sale.

Gillett GEMS, LLC is a corporation of four members that includes George Gillett Jr., who purchased Evernham Motorsports, which later became Gillett Evernham Motorsports and then Richard Petty Motorsports.

Evernham charges in the suit that Gillett breached an agreement to pay the remaining 20 percent owed for the Sprint Cup organization.

"We have diligently worked to resolve this matter in good faith without resorting to legal action," Evernham said Wednesday in a statement. "This matter has been pending for a period of time and we did not want to disrupt any excitement of the beginning of the race season with this unfortunate situation.

"We were unable to come to a fair resolution for the amounts due to me related to my sale of the previous RPM race team. Like many other vendors and creditors, my claims have been left unpaid."

Gillett, on the brink of financial ruin over the sale of his Liverpool soccer team, late in 2010 reached a financial agreement that gave NASCAR Hall of Famer Richard Petty control of the four-car operation that has since shrunk to two. Evernham at the time still owned 20 percent of the company.

Evernham, after being released from his non-compete clause in the terms of his contract with Gillett, recently accepted a position as a consultant for Hendrick Performance Parts.

Evernham won three Sprint Cup titles as the crew chief for Jeff Gordon at Hendrick Motorsports.

http://sports.espn.go.com/rpm/nascar/cup/news/story?id=6152406



Not a pot to piss in 

Former Liverpool FC owner Tom Hicks' sports group accused of fraud in US legal action

A COMPANY controlled by Liverpool FC’s former co-owner Tom Hicks has been accused of fraud in US court papers.

Global accountancy firm KPMG is being sued by a finance company for giving a ‘clean bill of health’ to Tom Hicks’s American sports group which owned the Dallas Stars hockey team and Texas Rangers baseball team a year before it defaulted on a $540m credit line in March 2009.

KMPG is accused by New York-based GSP Finance of assisting Hicks Sports Group (HSG) in hiding the true position of the company’s finances.

“KPMG substantially assisted Hicks Sports’ fraud by certifying that its consolidated financial statements ‘present fairly, in all material respects, the financial position of [Hicks Sports] and subsidiaries... and the results of their operations and their cash flows... in conformity with US generally accepted accounting principles,’” the claim form asserts.

In court papers lodged in New York, GSP says that had KPMG done its job properly the finance company would have been able to take action to recover $67m it loaned HSG.

The papers detail how Hicks’s company had made substantial losses in the years leading up to the Texan’s acquisition of Liverpool FC in 2007.

The lawsuit says HSG suffered losses of $113m in 2002, $67.8m in 2003, and $95m in 2004.

He then was forced to restructure his debts which culminated in a number of deals, and by late 2006 had a total credit facility of $540m to HSG through a variety of lenders.

The financial affairs of HSG were not related to those of LFC.

HSG made payments under the credit agreements until March 2009, but GSP says in the court papers that the company was effectively in default of loan covenants a year earlier but that KPMG did not raise any questions.

“Had it exercised due professional care, KPMG would have raised alerts as to the insufficiency of Hicks Sports’ cash flow to cover interest expense and mounting debt, thereby calling into doubt Hicks Sports’ ability to continue as a going concern,” the court papers state.

“KPMG would also have disputed Hicks Sports’ novel exclusion of capital leases and certain other debt obligations from its total debt and alerted the lenders as to Hicks Sports’ breach of debt covenant, especially as this was a change from the prior accounting principles employed by Hicks Sports prior to the issuance of the financial statements.”

The finance house accuses KPMG of “allowing other factors to cloud its judgment”.

“KPMG recognised that Tom Hicks remained not only a significant player in private equity investing, but also continued to increase his footprint in professional sports, having acquired Liverpool FC of the English Premier League in early 2007.

“It is understood that a negative auditor’s opinion for Hicks Sports could jeopardise significant future revenues from providing audit and advisory services to Hicks Sports and other Hicks-controlled entities.

“Put simply, KPMG valued the future business it stood to gain from Hicks Sports and other Hicks-controlled ventures more highly than the duties it owed to GSP and other lenders.”

It says that KPMG’s March 2008 audit report expressed no doubts as to Hicks Sports’ ability to continue as a going concern even though a $600m debt covenant had been exceeded.

“Had KPMG truthfully represented Hicks Sports’ position in March 2008, the lenders would have been able to declare Hicks Sports in breach of both the going concern requirement and the First Lien Debt Covenant, exercise their rights under the credit agreements nearly one year earlier, and obtain full repayment on the loans.”

GSP claims that HSG “strategically” timed its default to take advantage of a line in the credit agreements that prevented lenders taking control of the group’s finances if it defaulted within 180 days of the opening day of the National Hockey League’s (NHL) opening day.

“Pressing every last available advantage, Hicks Sports continued making interest payments until its March 31, 2009 default date, which not by coincidence, resulted in an event of default occurring exactly 179 days before the NHL’s 2009-2010 opening day.”

As a result the lenders were not able to exercise their rights until the summer of 2010. In the intervening period HSG remained in control of the Stars and Rangers.

When HSG tried to sell the Rangers the lenders refused to agree and the team filed for bankruptcy protection and was eventually sold.

GSP said it was not fully compensated under the deal which netted around $300m for all lenders.

The court papers list four causes of action against KPMG: fraud, aiding and abetting fraud, civil conspiracy, and negligent misrepresentation

The finance company is seeking compensatory and punitive damages in the case.



http://www.liverpoolecho.co.uk/liverpool-fc/liverpool-fc-news/2011/03/31/former-liverpool-fc-owner-tom-hicks-sports-group-accused-of-fraud-in-us-legal-action-100252-28436091/3/

Yet these were the preferred bidders who passed our stringent examination of their financial affairs.

And Parry is always saying that he did his best. The Tit.

Yet these were the preferred bidders who passed our stringent examination of their financial affairs.

And Parry is always saying that he did his best. The Tit.

I especially love this bit:

The lawsuit says HSG suffered losses of $113m in 2002, $67.8m in 2003, and $95m in 2004.

He then was forced to restructure his debts which culminated in a number of deals, and by late 2006 had a total credit facility of $540m to HSG through a variety of lenders.

It took it's time but we had a very, very lucky escape. Them two and NESV up to now, chalk and cheese.

Surely this has to be part of the massive anti Hicks and Gillette conspiracy ?
Seriously did Parry and Moores ever hear of the words 'due dilligence' or did they have several million reasons not to worry.

Just imagine where we would be with this clown in charge.

Take a second to thing about it.

Scary.  Very very scary.

Surely this has to be part of the massive anti Hicks and Gillette conspiracy ?
Seriously did Parry and Moores ever hear of the words 'due dilligence' or did they have several million reasons not to worry.

the smell of personal gain was there ONLY motivation.

Former Liverpool FC owner Tom Hicks' sports group accused of fraud in US legal action

GSP claims that HSG “strategically” timed its default to take advantage of a line in the credit agreements that prevented lenders taking control of the group’s finances if it defaulted within 180 days of the opening day of the National Hockey League’s (NHL) opening day.

“Pressing every last available advantage, Hicks Sports continued making interest payments until its March 31, 2009 default date, which not by coincidence, resulted in an event of default occurring exactly 179 days before the NHL’s 2009-2010 opening day.”

As a result the lenders were not able to exercise their rights until the summer of 2010. In the intervening period HSG remained in control of the Stars and Rangers.

When HSG tried to sell the Rangers the lenders refused to agree and the team filed for bankruptcy protection and was eventually sold.

To me, this bit in particular shows what a manipulative, cancerous leech the man is.  Thank god for NESV.

This is extremely interesting from our point of view as KPMG were our auditors too. 

When Mike (Queuepolitely) and I were investigating the Company accounts, we questioned how they could put through £112m costs for the new stadium when no work other than the plans had been done. 

We both agreed that any good/genuine auditor would and should have questioned these figures.

We thought it was another way for them to sypher money from the Club??

Seriously did Parry and Moores ever hear of the words 'due dilligence' or did they have several million reasons not to worry.

Parry thought a "bought and paid for" phone call to Rothschilds was "Due Diligence"

...and the extra £ millions of sweeteners he took from the fat sweaty hand of Hicks ... and his mate.

Good grief.

Any credibility that moores and parry had is long gone now, surely.

Personally, I can't wait for Rafa's book detailing his struggles against these crooks.

I'm sure he would have signed some sort of NDA, but it would have been for a limited time - or it should have been, and Rafa is no-ones fool so would have got the best deal he could regarding any NDA.

We'll see, I suppose, but I think I know who is going to smell of roses and who is going to smell of sh*t in all this bollox.

Thank fook we seem to be on the right track now.

 Now we know why he was hoping to get 600 million quid for the club,the basta*d has been well and truly rumbled.