Anaheim City Council Votes Against Angel Stadium Land Deal
Angel Stadium Parking
Kirby Lee-USA TODAY NETWORK

The Los Angeles Angels may be in need of a new home within the next decade after SRB Management’s deal to purchase the stadium land fell apart due to a corruption scandal.

The deal was agreed to in December 2019, when Anaheim agreed to sell Angel Stadium and its surrounding land to SRB Management, which is owned by Arte Moreno. In return, SRB Management agreed to pay $150 million in cash and another $170 million in community benefits to the city of Anaheim, which would be used to build affordable housing and a large public park.

However, that deal was put on hold when an FBI investigation into Anaheim mayor Harry Sidhu began for alleged corruption. He is being accused of asking for campaign contributions in exchange for using his power to get the deal completed, which would have fulfilled a campaign promise to keep the Angels in Anaheim.

The Anaheim City Council met on Tuesday to discuss their plan moving forward, and they ultimately decided to unanimously vote to cancel the deal, which could cause a large legal battle, via Bill Shaikin of the L.A. Times:

The Anaheim City Council voted unanimously late Tuesday night to kill the sale of Angel Stadium and the surrounding property, in the process bracing for what city councilmen said could be a long and nasty legal battle with Angels owner Arte Moreno.

The city council ultimately decided the concerns of corruption outweighed the benefit of the deal and decided to ask the Orange County Superior Court to cancel it despite Moreno’s demands for them to approve the sale.

With an agreement unlikely to be reached between both sides, the council expects this case to be heard and discussed in courts over the next few years:

The council asked the city attorney to notify the Angels of the decision Wednesday, the start of a process in which the city would ask the Orange County Superior Court to declare the deal invalid because of “concerns of conflict of interest and that the transaction was not at arm’s length,” as the attorney for Moreno’s management company had said in a letter that demanded the council approve the sale.

In the absence of a settlement with the Angels, Councilman Stephen Faessel said the termination “is going to be litigated for the next several years” and said he did not anticipate a window to reopen negotiations with the Angels before then.

Anaheim may be on the hook to pay Moreno back the money he already invested into the deal, but the city believes the fraud tied to the deal may resolve them of that cost, which could set up another lawsuit:

Under the terms of the sale agreement, if Anaheim kills the deal, the city could refund the $50 million Arte Moreno already has put into escrow, plus up to $5 million in his “transaction costs” and potential legal fees. However, the city’s preliminary legal position is that the alleged fraud might relieve the city of that burden – and could trigger a court to order Arte Moreno’s company to pay the city’s legal costs.

Arte Moreno, who formed the management company to develop the Angel Stadium property, also could sue the city for breach of contract.

Although the deal fell apart, the Angels’ lease at Angel Stadium runs through 2029 and they are reportedly committed to playing it through.

They also have to option to extend their stay through 2038 if they choose to, but that feels more unlikely to happen if the city and Moreno are unable to reach a deal.

No evidence Angels committed any fraud

While Sidhu is under investigation for corruption related to the deal, there is currently no evidence that anyone involved with the Angels organization committed any fraud.

Sidhu allegedly shared confidential information about sale negotiations with the Angels while the city was negotiating against the team hoping to receive a large campaign donation from an Angels representative.

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