While Tom Dundon looked like the villain in the premature demise of the Alliance of American Football earlier this year, Dundon claims key information was kept from him when he was approached to invest in the league.
And he wants his $70 million back.
The AAF was struggling with its finances almost immediately and it seemed, briefly, that Dundon was going to save the league. The owner of the NHL’s Carolina Hurricanes pledged up to $250 million to the league. Then, in the middle of its first season, when it was clear the NFL wasn’t going to join in and turn the AAF into its developmental league, Dundon pulled the plug.
In a filing in bankruptcy court, Dundon said AAF officials misled him when they approached him to become an investor.
Tom Dundon wants $70 million
Dundon wants a bankruptcy-court return of $70 million, according to Daniel Kaplan of The Athletic, saying “misrepresentations” were made to him by AAF officials to get him to invest.
The court filing said that AAF executives told Dundon his investment would get the league through its first season, but those executives knew another $50 million was needed on top of Dundon’s first $70 million, The Athletic reported.
In the court filing Dundon also claimed the AAF “had accumulated more than $13,000,000 in unpaid debts and commitments” that weren’t disclosed to him. The Athletic said Dundon could be filing in bankruptcy court against the AAF to remove himself from any litigation from creditors, or to trigger AAF executive and board insurance policies for more money.
It’s all a bit of a mess. Which is how we’ll remember the AAF.
AAF was a surprising failure
The AAF started the week after the Super Bowl and had a great opening weekend. It was praised on social media and drew great television ratings for a startup league. It really did seem the league was on solid footing and could finally be a viable second pro football league in the United States.
But at the time the AAF rolled out, nobody knew how bad the financial situation was. Once there was a report that the AAF was in danger of not making payroll before its second week of games, it was clear the league might be in trouble. It didn’t even make it to the end of the regular season.
As the XFL gets set to launch in 2020, there will hopefully be some lessons learned from the debacle that was the AAF.
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