Owner of Real urged to pay debt

(by Stephen Speckman and Amelia Nielson-Stowell desnews.com 7-27-06)

Checketts company thousands behind on some obligations

Pay your $900 here and your $100,000 there and a multitude of other long-standing debts before trying to build a $145 million soccer stadium.

That's what people in the television industry are telling Real Salt Lake owner Dave Checketts, who is a significant investor in the college-sports broadcast company SportsWest Productions.

Jeff Scott, owner of Boise-based NetWest Communications, said SportsWest owes him almost $100,000. He said a company in Denver is owed about $75,000. Scott has been trying to collect since the beginning of the year.

Another source, who wanted to remain anonymous, said more than 100 people — those who bring the sights and sounds of college sports into homes via TV — are waiting to be paid by SportsWest for jobs dating back to last November. They include Glenn Graham, whom SportsWest owes about $900, and Dave Melfi, owed more than $4,200. Both men are based in Albuquerque, N.M.

Checketts said Thursday in a statement that, against the advice of his attorneys, he will pay several creditors using his own "personal" resources.

"Although I am not legally obligated to make these payments, my moral compass compels me to pay something more to those who have worked with SportsWest," Checketts said.

But some of his creditors are skeptical. "I don't really believe I'll see a nickel of it," Graham said.

Last March, Scott filed a lawsuit in Salt Lake City's 3rd District Court against SportsWest, which filed a countersuit. Scott eventually dropped his case, fearful the end result would mean collecting far less than he is owed.

Scott blames SportsWest for his having to sell off some of his own assets. Still, he's hopeful Checketts and SportsWest will pay up in full.

"Obviously he (Checketts) has the money to straighten out this little venture before he gets into another one," Scott said.

At least some of the money owed to Scott and dozens of others appears to be on the way, as SportsWest continues to liquidate its assets and "fairly" distribute its assets to creditors.

For more than three months, SportsWest has employed a full-time chief financial officer and a full-time attorney, attempting to collect on debts owed to the company and terminate all business operations, said John Mellville, senior vice president over sales and marketing for SportsWest. The company on Thursday received the last payments that it felt were collectible.

Mellville apologized that the legal process of liquidating SportsWest has taken so long and said that SportsWest will be making payments to its creditors in the next few weeks.

Checketts has also been tallying up his losses.

"I, personally, am owed millions of dollars from SportsWest that I will never recover," Checketts said. "The liquidation of SportsWest's assets will not cover all of the debts owed to the creditors."

Checketts said the company is terminating its operations due to "unanticipated market factors and competitive conditions" that are out of his control. It's been reported that SportsWest is being folded into College Sports Television Network (CSTV), for which Checketts is co-chairman and an investor.

Through it all, Checketts is still hunting for a place in Utah to build a home for his soccer team.

Salt Lake County Mayor Peter Corroon said Thursday that the county has received three or four calls from people in the past couple of months saying the company never paid them for past work.

"Obviously, that's some- thing that is a concern to me personally and the county as a whole," he said.

Last year, Checketts released plans to build a 22-acre soccer stadium for Real Salt Lake. Construction on the $145 million stadium was slated to have begun at 9400 S. State Street in Sandy this fall. But in a 5-4 vote earlier this month, the Salt Lake County Council denied Sandy's funding plan for the project.

The vote marked the second time in three months that county officials rejected a public-funding option for the stadium. Corroon denied the team's first stadium-funding plan in May.

As for whether SportsWest's financial shortfalls affected his decision, Corroon said: "Well, I would say no, but obviously it's always in the back of my mind. Before I would approve any deal, I would want to make sure that obligations from other companies are being paid. I would not feel comfortable supporting a business that doesn't pay its bills."

He said he has not expressed those concerns to Real. "In defense of Dave Checketts, I certainly wouldn't make any judgments on him without knowing the facts."

Corroon added that he would not approve any further funding scenarios until business matters at SportsWest are resolved.

Sandy Mayor Tom Dolan was out of the office Thursday. But Sandy's communication director, Trina Klinger, said Dolan would not have a comment concerning Checketts' business dealings because they are not related to the stadium project.