Dallas Stars: Mavericks' Las Vegas offices violate franchise agreement

Dallas Mavericks Governor Patrick Dumont walks on the sideline during an NBA basketball game against the Golden State Warriors in Dallas, Wednesday, March 13, 2024. Photo by: Tony Gutierrez / AP

DALLAS — The Dallas Stars submitted new court filings in their ongoing legal battle with the Dallas Mavericks on Tuesday evening, accusing the Mavericks of violating their own franchise agreement with the City of Dallas.

The Stars submitted a motion in Texas Business Court to amend the original counterclaim they filed against the Mavericks on Oct. 28, while also filing a motion to reopen their bankruptcy case from 2011.

The team’s attorney, Joshua Sandler of Winstead PC, says that case proves the Mavericks and the City of Dallas were both aware the Stars’ headquarters was in Frisco and had a chance to object a decade ago during the bankruptcy restructuring plan.

In the amendment to the counterclaim, the Stars say the Mavericks violated their franchise agreement with the City of Dallas when they changed their principal location to Las Vegas in 2024 during Mark Cuban’s sale of the team to Miriam Adelson and the Dumont family.

“The Mavericks engaged in the very conduct they allege entitles them to take full control of the American Airlines Center,” the amended counterclaim states. “The only difference between the two scenarios is that the Mavericks’ principal office is 1,200 miles away and outside the State of Texas.”

The Mavericks, via their attorney Charles “Chip” Babcock of Jackson Walker, rebutted the Stars’ claims.

“The Mavericks haven’t moved their offices, unlike the Stars,” Babcock told The Dallas Morning News. “They have the same offices that they’ve always had. And if you gaze out across Stemmons, you’ll see the Mavericks’ practice facility across the highway. Their principal corporate and executive offices are within the city of Dallas, just as they’ve always been. There isn’t any question that the Stars moved to Frisco.

“And this lawsuit is not about where the Mavericks have their principal place of business; it’s where the Stars do. They literally have defenses from A to X. I don’t know what happened to defenses Y and Z. I’m very curious about what happened to those defenses.”

The Mavericks initiated the dueling lawsuits on Oct. 28 when they asked for legal finality on an alleged breach of contract dispute. The NBA team alleges the Stars are in breach of their 1998 franchise agreement that requires their corporate headquarters to be located within the city of Dallas. The Stars’ headquarters have been located in Frisco since 2003.

The Mavericks sent the Stars a letter and $110 in cash last October alerting them of the breach and of their intention to take over the Stars’ interest in Center Operating Company, the joint venture between the franchises that operates American Airlines Center.

For the past year, the Stars have not had access to their quarterly arena proceeds. The Stars say the amount is “in the tens of millions.” The Mavericks pointed out to The News that their arena distributions are frozen, as well.

The Stars filed a counterclaim saying the Mavericks had no right to claim a breach of agreement — only the city could — and that they cannot claim the Stars’ interest in Center Operating Company until a court finds that the Stars breached certain obligations owed to the city. The City of Dallas has sided with the Mavericks.

In the Stars’ motion Tuesday to reopen their 2011 bankruptcy case, they claim the Mavericks “clearly knew” about their headquarters location during that case and with the City of Dallas received notice of a court-approved bankruptcy plan requiring them to assert any claims against the Stars at that time.

“Both the City of Dallas and the owners of the Dallas Mavericks consented to a court-approved bankruptcy plan which adjudicated and released the claims the Mavericks now bring against the Stars by failing to raise any of these claims during the bankruptcy case” the counterclaim now reads.

The Stars say “sufficient cause” exists to reopen the case to enforce the legally binding confirmation order.

The Stars doubled down on the fact that the Mavericks were well aware of their headquarters location in the counterclaim amendment, saying the Texas Legends, the Mavericks’ G League team, play their games in Frisco at the Stars’ Comerica Center headquarters, renting the space from the Stars for over a decade.

The legal feud between the teams first began when the Mavericks raised awareness of the Stars’ agreement breach over a year ago, a few weeks before the team and the City of Dallas say the Stars backed out of a $300 million deal to renovate AAC, according to interviews and documents obtained by The News.

In the deal, according to the city and the Mavericks, the Stars agreed to remain in AAC through 2061 and would have paid no renovation costs, with the city and Mavericks footing the bill 50-50.

The Stars deny they agreed to the deal and say had it gone through, the teams would have shared half the renovation costs. The Stars maintain they agreed to a different deal that would extend the lease with both teams staying at AAC through 2035.

The teams are scheduled for a jury trial on 9 a.m. Jan. 26 in Texas Business Court. Their next scheduled conference hearing is at 2:30 p.m. Friday.

———

Staff writer Brad Townsend contributed to this report.

©2025 The Dallas Morning News. Distributed by Tribune Content Agency, LLC.