If Bill de Blasio really wants to do this, if he truly is determined to prevent Steve Cohen from purchasing the Mets for $2.4 billion and not just trying to score a few points in a few circles by staying on brand, then the New York City mayor had best hire some darn good attorneys.
Because you know Cohen, just as his fictional counterpart Bobby Axelrod of “Billions,” employs his own damn stable of prize-fighting litigators. A pair of experts in this field agreed that, while de Blasio would possess a chance of prevailing by invoking language in the Citi Field lease agreement between the Mets and New York City, victory would require some significant legal gymnastics and, even if he scored the upset win, Cohen could try other avenues to get what he wants.
The key word in the whole theoretical battle just happens to match what de Blasio wants in these proceedings.
As Dan Stanco, partner and co-head of the real estate practice at Ropes & Gray said Thursday in a telephone interview, “It will ultimately come down to how ‘control’ is interpreted in this context.”
Here’s how the lease agreement, a copy of which The Post obtained, reads on the critical “Prohibited person” clause, laying out the standards for the type of aspiring Mets owner would be turned away: “Any Person that has been convicted in a criminal proceeding for a felony or any crime involving moral turpitude or that is an organized crime figure or is reputed to have substantial business or other affiliations with an organized crime figure, or that directly or indirectly controls, is controlled by, or is under common control with a Person that has been convicted in a criminal proceeding for a felony or any crime involving moral turpitude or that is an organized crime figure or is reputed to have substantial business or other affiliations with an organized crime figure.”
Yes, it’s a mouthful, so let’s break it down: Cohen himself has not been convicted of any crime, so you can throw that out. Does his former hedge fund, S.A.C. Capital Advisors, which pleaded guilty to insider trading in 2013, make Cohen an “organized crime figure”? Seems like a stretch.
“The determination of whether a person is an organized crime figure under the lease is essentially at the discretion of the landlord,” Kris Ferranti, a partner in the real estate group at Shearman & Sterling LLP, said Thursday in a telephone interview. “But it has to be exercised in good faith. … Within the context of this lease and how we generally understand ‘organized crime figures,’ it’s things like terrorist organizations, crime rings, crime syndicates.”
That brings us to that critical “control” of a convicted person. As Stanco said, “If you take that Cohen controlled S.A.C. Capital — S.A.C. literally stands for ‘Steven A. Cohen’ — eight of his traders pled guilty to or were convicted of insider trading, which can be prosecuted as a felony. Pleading guilty in the eyes of a court is the same thing as being convicted. You can’t draw a distinction there.”
However, Ferranti opined, “The key here is how control is typically defined in leases and other contracts. It’s typically more in the context of an entity than an individual. In the classic sense of the way that term is typically used in contracts, you don’t ‘control’ individuals.”
Furthermore, if de Blasio did pull off an upset victory, it wouldn’t necessarily mean the end for Cohen. Said Stanco: “The reality is that Cohen will likely be able to structure around it by putting the lease into an entity or trust that he doesn’t control. If he can properly distinguish the ownership of the team from the tenant in the lease, Cohen should be able to make it work.”
As The Post reported Wednesday, the Mets hired two law firms to vet de Blasio’s juice in this matter, and both firms concluded the city would have no standing to oppose Cohen’s purchase.
It might be a win for him just to pound his chest and assert his relevance here, to insert his name in the Mets-Cohen saga. I hate to be the one to break it to you, but that’s all some politicians really care about in the end.
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