Judge Brown Denies Motion to Dismiss; Stays Lawsuit Proceedings Until Further Notice [Updated]

Updates: I just did a Periscope talking about the ruling. Check it out!

Read MLS’ reaction to the decision.

The shoes continue to drop.

Alongside the question of when there may be an announcement that the Crew have been sold to local ownership, there is still the question of how the lawsuit will be wrapped up. Back in September, the parties had oral arguments over the constitutionality of the Modell Law. Judge Brown took the matter under advisement (a customary practice), and as we later found out, MLS had been negotiating a sale with local owners.

Of course, negotiations don’t necessarily stop the legal process, and we just hit the three-month mark since those oral arguments on the motion to dismiss. And while it seems that a sale is imminent, Judge Brown has seen fit to render a decision, denying MLS’ motion to dismiss the Modell Lawsuit.

Further, given the advanced state of negotiations, Judge Brown has also, on his own motion, stayed the legal proceedings, essentially freezing the lawsuit until further notice. That means there will be no discovery process for the time being, so no document exchanges and/or depositions. If the rumors are right and a sale is announced this week, that generally renders the need to proceed moot (with one exception, which I outlined in my earlier piece today).

The matter has also been put on hold until further notice.

Obviously this is a big win for the SaveTheCrew movement, and the plaintiffs who brought the suit and defended this motion.  A loss would have presumably meant the end of the case (subject to appeals), and could have freed up MLS to move to Austin immediately. Interestingly, the delay in the ruling provided additional time for MLS and local buyers to come together and get a deal done. Which is probably what Judge Brown was hoping for the entire time.

Finally, the denial also provides not a small amount of leverage in the final negotiations, since any “bad behavior” could land MLS back in court fighting the lawsuit to the end. That said, I think everyone is ready to move on at this point, and start focusing on battles on the pitch as opposed to the courtroom. 

I’ll be back later with full analysis of the ruling. I told you to stay tuned this week! More to come for sure!

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