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Opening Night for the NHL's new season just became a more festive occasion as bankruptcy judge Redfield Baum rejected Canadian billionaire Jim Balsillie $242 million bid for the Phoenix Coyotes, concluding that it would interfere with the league's relocation rights and procedures. As many know, Balsillie sought to move the ailing team to Hamilton, Ontario, causing consternation to both the Toronto Maple Leafs and the Buffalo Sabres and to the league itself. "In the final analysis, the court cannot find or conclude that the interests of the NHL can be adequately protected if the Coyotes are moved to Hamilton without first having a final decision regarding the claimed rights of the NHL and the claims of the debtors and (Balsillie)," he ruled.

There was no love lost between the league and Balsillie, as the NHL Board of Governor rejected his application for ownership by a 26-0 vote in July. Click here for more. But what was particularly sweet was the fact that the judge dismissed the bid "with prejudice" so that Balsillie cannot rebid. He is out of the running for the team and accepted the result in a public statement.

However, it was not a complete victory for the NHL. Judge Baum rejected the NHL's bid of $140 million because it failed to satisfy two important unsecured creditors, owner Jerry Moyes and former head coach Wayne Gretzky.

I have not read the 28-page opinion as of yet, but based on the media reports, this is a victory for league governance. To have a candidate take control of a team by judicial fiat, despite the strong feelings of the league and its owners, would greatly weaken the traditional control sports leagues have over admissions, relocations and sales of franchises.

I suspect that the league will attempt to find a new bidder (or maybe get Jerry Reinsdorf to make another bid) or will have to bid a higher amount to take control of the team during its period of uncertainty. The NHL could well live with both of these alternatives.

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