SJSE paid out $600,000 for kicking Growlers out of arena
St. John’s Sports and Entertainment (SJSE) paid $600,000 to Dean Macdonald’s company, Deacon Sports and Entertainment (DSE), for improperly evicting the Newfoundland Growlers from the Mary Brown’s Centre in 2021.
This number was hidden from public view for the last two years as the city fought the release of information it redacted in an access to information request made by The Telegram for SJSE financial statements, even taking the matter to Newfoundland and Labrador Supreme Court to try to suppress it.
EMPLOYEE SEVERANCE
Coun. Ron Ellsworth, who sits on the SJSE board for the city, said the reason the city resisted releasing the information was due to other financial information it had redacted in that ATIPP request, namely details of its food service management agreement with Servomation Inc. (Centerplate) and the total amount SJSE paid in severance to an unknown number of employees, to the tune of $847,007.
“The issue for us was the information redacted not only pertained to SJSE but also pertained to compensation for salaries and termination packages and also some proprietary information that was in there,” Ellsworth said.
“That’s what ultimately we were trying to protect. There was no issue from the city with releasing the amount for Deacon Sports and Entertainment and also, we had a nondisclosure agreement with Deacon that we had to work through. That’s why it’s taken us to this point.”
BREACHING LEASE
The conflict started in 2021, when DSE issued a notice of arbitration to SJSE, alleging that SJSE breached its lease by kicking the team out of the Mary Brown’s Centre and not following the proper arbitration process.
This followed the city announcing an investigation centred on allegations of “disrespectful workplace conduct” brought by staff of SJSE against employees of the Growlers and locking the team out.
When asked why the city took those steps, which led to this $600,000 payout, Ellsworth said the move was “to protect the innocent employees who were caught up in the disputes going on between DSE, SJSE, management and the board.”
NEEDED STEP FOR INVESTIGATION
“We made a decision to protect the employees and that’s why we made the decision to lock (the Growlers) out,” Ellsworth said.
“How could we go through an investigation of a disrespectful workplace, allowing our employees feel safe and comfortable, when the very people being looked at were still in the building every day of the week? A decision was made to protect the employees and to bring this to a head in order to move forward.”
Ellsworth said the severance and other termination amounts weren’t directly related to the workplace harassment investigation that led to the Growlers being evicted from the centre, but said it was “related to the necessary changes that were needed in our organization to move the organization forward.”
NOT JUST RELATED TO LOCKOUT
In total, the city paid $1.29 million to DSE in a resolution agreement in 2021, but Ellsworth said the remaining $687,272 was related to other outstanding issues between SJSE and DSE.
SJSE had entered into a cost-sharing agreement with DSE for the installation of an LED ring in the arena, but Ellsworth said it was determined SJSE would cover the entire cost so DSE wouldn’t have an ownership stake in a capital asset at the Mary Brown’s Centre.
An additional $141,000 that SJSE paid to DSE was related to the naming rights for the facility under the lease agreement.
“We had several outstanding items that we were working through, so, because we were going through a dispute resolution recognition process both parties agreed it was a good time to clean up anything that was causing any issues,” he said.
“The light ring and the cashflow for the naming rights just happened to be on the table at the same time, and rather than going through one piece to deal with the eviction and another piece to deal with the other items, we just dealt with it together and both teams worked for a resolution that worked for both sides.”