From...

September 28, 1999
Web posted at: 4:46 p.m. EDT (2046 GMT)

by Bernhard Warner

New York (IDG) -- John Crotty, Brian Flynn and Peter Lyons are typical New York Jets fans. Win or lose, they cheer as loud as they can on Sunday afternoons and return to work Monday morning emotionally spent.

Like most Jets fans, they hold strong opinions about the way the NFL franchise is run, from retaining coach Bill Parcells to lowering ticket prices to getting a new home. (The team shares a New Jersey stadium named for their hated rivals, the Giants.) So when longtime owner and oil tycoon Leon Hess died in May, this unlikely trio – all in middle management at companies they won't identify – took a stab at every fan's dream: buying the team.

Realizing the sale price could exceed $500 million, the friends knew they'd need to raise almost all the funds from fellow fans. Lyons, the most Web-savvy of the bunch, built a site with the help of Vivian Padag, a former business associate, and registered the domain, Buythejets.com. The site, which launched in August, asks fans to bid between $1,000 and $5,000 for an ownership stake in the team. (Legally, they can only take bids, no cash.)

At first, nobody wagered much of a chance on them. The New York media regarded the trio as an outmatched group of Davids with thick New Yawk accents. The NFL called their bid to buy the Jets "flattering," but ultimately dismissed them. The investment bank handling the deal, Goldman Sachs, ignored their repeated requests to be included in the bidding process.

But in four weeks time, the group (which has been fielding press calls on the sly at work and relying on fellow fans for media contacts and legal assistance) claims to have drawn more than 8,000 bids through the site, totaling in excess of $17.5 million. It's thought to be the first grassroots effort organized entirely on the Web to buy a pro sports franchise.

"Ten years ago, if I was sitting outside of the Jets stadium saying, 'I want to buy the Jets,' I'd get a pat on the head: 'Good luck, kid.' But with the technology now available, you can do something about it," says Crotty. The movement, he adds, was born on a public golf course on Long Island.

Thanks to the site, the three men got noticed by the local press. And now a pipe dream has become a political battle. New York politicians, including City Council Speaker Peter Vallone, three state congressmen and the city comptroller, have joined the cause – moves, it must be noted, that are nothing if not politically expedient. In a letter to NFL Commissioner Paul Tagliabue, Vallone wrote: "We only ask that the people of New York be afforded the opportunity to coordinate a bid for the Jets, and not be summarily ignored. Mr. Tagliabue – we are waiting."

To be sure, the league and Goldman Sachs are no longer dismissing the group. The bank met with the three men, although permission to bid on the Jets is still not assured. Tagliabue, meanwhile, responded to Vallone last week in a letter, saying he was gratified by the fan-initiated effort. However, the commissioner wrote, the league "would not permit an ownership group of this sort... No team in any league is owned in this manner, and an ownership structure of this type presents many serious issues and concerns."

NFL teams are among the most expensive sports franchises in the world. The league is considered financially stable, pulling in billions annually in broadcast, licensing and merchandising fees. Because of this, the NFL has been able to set strict ground rules for ownership.

In other leagues, for instance, pro teams like the Cleveland Indians in baseball and the Boston Celtics in basketball are publicly traded. But the NFL permits only individuals, not corporations, to buy a stake in a team. Furthermore, no ownership group can exceed 25 individuals. The Buy the Jets group says the rules have created an oligopoly of greedy businessmen who care less about the fans than they do about their wallets.

"We think [the league] is colluding to exclude us," says Crotty. "The Hess estate, to some extent, is impartial. The NFL, however, has these laws in place to prevent this from happening." To Crotty, the crusade is no longer about living out a childhood fantasy. It's about toppling the league's "old boys' club" ownership structure.

There is one exception to the NFL's limited-partnership ownership format: the Green Bay Packers, which incorporated in 1922, before the NFL could enforce its ownership rules. In the Packers case, individuals own the team, but their shares hold no value. Packers owners don't receive dividends and cannot sell their shares.

Jeff Blumb, a spokesman for the Packers, declines to comment on the Jets campaign, while explaining that the league accepts the Packers' ownership structure because "our structure is proven to work. Who's to know if the next group that comes along will [have a functioning system]?"

"Is Green Bay unique to the world, where there is this management utopia in place?" asks Crotty, not hiding his sarcasm. "I think not." Crotty's plan calls for fan-shareholders to collect dividends. Shareholders also would have voting power over ticket prices and, like the Packers, over electing a chief executive to run the franchise.

Ted Leonsis, president and CEO of AOL (AOL) Studios and the new owner of the NHL's Washington Capitals, says he thinks group-ownership structures are too difficult to pull off. He's solicited fan input via e-mail for some issues, like selecting pregame music, but says that basing management decisions on fickle fans would be a nightmare. "There's too many disparate concerns," Leonsis says.

Despite the opposition, Crotty and his crew insist they'll keep fighting for their right to bid. He figures they'll need at least $200 million to make a serious offer for the team. Lacking time, money and clout, Crotty says he's not interested in winning moral victories. And, even if he were eventually able to change league rules, it wouldn't be enough.

Crotty throws out a rhetorical question: "What does [Coach] Parcells say? 'You get no medals for trying.'"

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