Think things will change? Losing can be profitable too

[THE PISTONS]

I keep reading people post that maybe the NFL will step in and make them sale. Then, I read about how Palmer said he asked for more player signings and none...and how it's hard to play for a team that's primarily motivated by finances 1st.

Then, I read this blurb. The link to the Enquirer story is since gone...but IF they made that much money in the 90's...who knows what they're making now:

'From 1994-2000, the Bengals paid out over $50 million to the Brown family members of Bengals staff in salaries.'

https://en.wikipedia.org/wiki/Mike_Brown_(American_football_executive)

[THE PISTONS]

A 2009 article that has other details:

Court case reveals Bengals' millions
By Kimball Perry • kperry@enquirer.com • April 24, 2009

In a case that provides a rare glimpse into the closely held finances of the Cincinnati Bengals, the Ohio Supreme Court this month validated a stock deal that gave Mike Brown’s family unquestioned control of the NFL team.

The court upheld a 2007 ruling in a contentious Hamilton County lawsuit.

Through the years, Bengals’ finances have been so closely held that even informed guesses of the team’s value made by experts in the lawsuit varied widely – from $141 million to $1.18 billion.

The Enquirer analyzed transcripts of that trial that give tantalizing glimpses of the finances of the team and the Brown family.

Among details of the team’s finances that emerged from the case is that from 1994 to 2000 – as Brown campaigned for and got a new publicly funded stadium to remain solvent and stay in Cincinnati – the team paid Brown and his family in excess of $50 million.

That amount includes money the team paid to the Brown family as the team’s majority shareholders, as well as millions annually for their salaries and bonuses as team employees.

The numbers came from expert testimony given during the hard-fought 2007 Hamilton County Probate Court trial over the $300 million estate of Austin “Dutch” Knowlton, a Bengal founder who also was an owner of the Cincinnati Reds.

Knowlton died in 2003 at age 93, but left a will that excluded his adult children.

The children sued, saying they were improperly cut out of their father’s will, and blamed Knowlton’s lawyer – prominent Cincinnati attorney and Bengals shareholder Charles Lindberg.

They accused Lindberg of violating his duty as Knowlton’s lawyer and his interest as a trustee of Knowlton’s $300 million charitable trust because while he served as Knowlton’s personal lawyer, Lindberg was the managing partner of the Cincinnati law firm of Taft Stettinius & Hollister that also represented the Bengals and the Brown family in legal issues – including the stock deal in question.

The case went to trial in 2007, and Lindberg and Brown testified. A jury found the stock deal valid, a ruling upheld in an opinion authored by Judge Patrick Dinkelacker of the Ohio 1st District Court of Appeals. That was appealed to the Ohio Supreme Court, which declined April 8 to hear the case, effectively ending it.

Testimony revealed the contentious, often-bitter relationship between Brown and Knowlton, who feuded for years over many issues, including what Knowlton believed were exorbitant salaries paid by the team to the Brown family members in the front office.

The centerpiece of the lawsuit was a 1994 secret deal between Knowlton and Brown. Knowlton supposedly wanted cash to live on – even though he was multimillionaire – and Mike Brown wanted majority ownership of the team.

The agreement resulted in Knowlton selling 60 of his then-236 shares of the Bengals to the Brown family for $6 million – $100,000 per share – a price Knowlton’s children considered outrageously low. In exchange, the Brown family gained ownership of two-thirds of the team’s 586 shares and Brown agreed the team would pay shareholders the vast majority of team revenues.

The result was that Knowlton got $6 million for those shares and Brown agreed to pay shareholders $80 million, more than half of which – $48 million – went to the Brown family.

Trial evidence shows Mike Brown got unquestioned control of the team and the right to determine how much the team would pay his family members employed there.

The Bengals declined to comment for this story, and also declined to confirm the validity of the finances testified to during that 2007 trial. The Enquirer presented the finances used in this story to the Bengals and asked if the numbers were accurate, but the team declined comment.

“The information requested by The Enquirer from the Bengals is proprietary and will not be made public by the Club,” Bengals spokesman Jack Brennan wrote in an e-mail to The Enquirer.

At about the same time Brown and Knowlton made the deal between themselves, Brown was leading a campaign – ultimately successful – to have Hamilton County voters approve a sales tax increase that would pay for a new football stadium, named for Brown’s father, Hall-of-Fame coach Paul Brown.

That sales tax hike convinced Brown to keep the team in Cincinnati – with lease terms that critics say are far too favorable for the team. Hamilton County went to court in 2003 to amend lease terms, claiming the lease was “grossly one-sided in the Bengals’ favor.” That claim was eventually disallowed by the courts.

Part of the team’s lease with the county is for stadium maintenance. Hamilton County records show that since Paul Brown Stadium opened in 2000, the public has paid $96.3 million for stadium maintenance, including a projected $10.7 million bill this year.

Shareholder finances were just some of the team’s finances it and the Brown family fiercely guard.

Edward VonderBrink, an accountant hired to review the team’s audited financial reports as part of the trial, had to sign a confidentiality agreement to reveal none of that financial information except in court.

During his trial testimony, Brown often refused to answer questions about team finances and his lawyers fought to prevent him from answering finance questions.



Others findings include:

• Mike Brown received millions in “general manager” bonuses, even though the team has no such title.

VonderBrink testified the team paid a “general manager” bonus of $1,237,000 in 1999 and $1,947,695 in 2001. Brown testified in the trial he received a bonus every year since he took over running the team in 1991.

• The $48 million paid to the Brown family came as the team also paid five Brown family members annual average salaries of more than $700,000, court documents note. The family members in addition to Mike Brown are: Brown’s brother, Pete Brown; Brown’s son, Paul Brown; Brown’s daughter, Katie Blackburn; and her husband, Troy Blackburn.

Those five family members, VonderBrink testified, were paid combined salaries of $3,926,000 in 1999 – an average salary of $785,200 – and $3,613,000 in 2001, an average salary of $722,600.

[SunsetBengal]

Most of us have known about this for years, not sure why this is the time to rehash all of the Brown families financial greediness, unless it's just to let some of the younger fans know what has went down?

We perceive Mike Brown and the family members in the front office as greedy, but we are only looking at the Bengals organization. Are they really greedy, or is that typical of NFL franchises in general? I wonder how the financials break down for other NFL franchises? It would be nice to have some data to use as a comparative barometer, in order to fully form our opinions on the matter.

[THE PISTONS]

(11-03-2019, 11:05 AM)SunsetBengal Wrote: Most of us have known about this for years, not sure why this is the time to rehash all of the Brown families financial greediness, unless it's just to let some of the younger fans know what has went down?

We perceive Mike Brown and the family members in the front office as greedy, but we are only looking at the Bengals organization.  Are they really greedy, or is that typical of NFL franchises in general?  I wonder how the financials break down for other NFL franchises?  It would be nice to have some data to use as a comparative barometer, in order to fully form our opinions on the matter.

It's in response to people saying that the NFL should step in and force them to sale...or people thinking that criticism by Carson Palmer will make them make drastic changes.

They're making millions. Likely no outside criticism will make them change.

[fredtoast]

(11-03-2019, 10:45 AM)THE PISTONS Wrote: 'From 1994-2000, the Bengals paid out over $50 million to the Brown family members of Bengals staff in salaries.'

https://en.wikipedia.org/wiki/Mike_Brown_(American_football_executive)

This headline is bullshit.

It was $2 million in salaries and $48 million to stockholders.  The payment to stockholders was probably exactly the same type of shares what other NFL owners/stockholders received.

Our front office is not very competent, but lots of other losing teams also make hundreds of millions of dollars in profits.

[reuben.ahmed]

Somebody has to lose, not every team can win. Ohio teams are chosen as the losers.

[*Synric*]

722k Salary? Lol Roger Goodell has that in his sock drawer.

[HarleyDog]

(11-03-2019, 12:38 PM)Synric Wrote: 722k Salary? Lol Roger Goodell has that in his sock drawer.

Damn, I need a sock drawer.

[HarleyDog]

I’m going to the courthouse tomorrow and changing my last name to Brown. Then I’m going to schedule a meeting with MB and say, I’m the unfortunate result of a Denny’s bathroom affair. I want to see if he’ll write me a check? Shit. He’ll probably just hand me expired coupons to Wendy’s.

[samhain]

(11-03-2019, 11:47 AM)fredtoast Wrote: This headline is bullshit.

It was $2 million in salaries and $48 million to stockholders.  The payment to stockholders was probably exactly the same type of shares what other NFL owners/stockholders received.

Our front office is not very competent, but lots of other losing teams also make hundreds of millions of dollars in profits.

Yeah, you don't defend them at every turn, do you, Fred?  They're just like every other NFL ownership group, aren't they?

Tell us, when it comes to the Bengals, who are the primary stockholders again?

 Nothing odd or dysfunctional going on here.  Did Mike Brown write your letter of recommendation for law school or something?

[grampahol]

Oh c'mon..everyone knows Mike Brown is gonna leave each and every member of this board a million bucks in his will which is why he'll have an army of lawyers to shut it down before his death..

[grampahol]

I get the strange feeling some of you people may not care for Mike Brown as much as you're letting on.
Must be something I ate. Everyone loves Mikey more than their own mothers. I bet a lot of you would like to adopt him as your own offspring then be so proud of his football skills..

[grampahol]

I guess this goes to show that if you can manage to hit the biggest ever lottery drawing in the billions buy an NFL franchise and no matter how incompetent or foolish you are, even if you're trying to lose money you'll only get richer unless perhaps you decide to maybe pay everyone in town millions each just to pretend to be fans. Even then it'd be tough to go broke. 

[Bengalholic]

(11-03-2019, 11:07 AM)THE PISTONS Wrote: It's in response to people saying that the NFL should step in and force them to sale...or people thinking that criticism by Carson Palmer will make them make drastic changes.

They're making millions. Likely no outside criticism will make them change.

Ya think?

When has criticism ever phased Mike Brown? This one short, simple quote - when he was asked about criticism from the fans and media - pretty much sums up how he feels about it:

 “I’m happy to be kicked around. I’m still here. Go at it if you will.”

[*pally*]

If money was all the Brown's were after then selling the team makes more sense than keeping it. The Bengals are worth $2 billion according to Forbes. The Browns own 100% of the team so that is cold hard cash that could come their way. They also could add millions more to their coffers by selling naming rights to PBS.

The problem goes so much further than dollars and cents. It starts with an owner who wants to run his team like it is still 1985. It is an owner who won't let any of the "power" positions go to anyone outside the family and Duke Tobin (who should have been fired with Marvin) who might as well be family at this point. It's an owner that while smart is almost paralyzed by the idea of change Its an owner who was raised by the greatest football mind in the history of the NFL who seemingly inherited none of that but seems to think he has.

As long as the ownership and management structure remains the same we will get the same results regardless of how much they spend

[THE PISTONS]

(11-03-2019, 03:00 PM)Bengalholic Wrote: Ya think?

When has criticism ever phased Mike Brown? This one short, simple quote - when he was asked about criticism from the fans and media - pretty much sums up how he feels about it:

 “I’m happy to be kicked around. I’m still here. Go at it if you will.”

Not to mention that a GM would likely cost between $2 and $7 million a year. They're not going to spend that

I do wonder what Duke Tobin is paid? I would guess it's not multiple millions.

[THE PISTONS]

(11-03-2019, 03:23 PM)pally Wrote: If money was all the Brown's were after then selling the team makes more sense than keeping it.  The Bengals are worth $2 billion according to Forbes.  The Browns own 100% of the team so that is cold hard cash that could come their way.  They also could add millions more to their coffers by selling naming rights to PBS.  

The problem goes so much further than dollars and cents.  It starts with an owner who wants to run his team like it is still 1985.  It is an owner who won't let any of the "power" positions go to anyone outside the family and Duke Tobin (who should have been fired with Marvin) who might as well be family at this point.  It's an owner that while smart is almost paralyzed by the idea of change  Its an owner who was raised by the greatest football mind in the history of the NFL who seemingly inherited none of that but seems to think he has.

As long as the ownership and management structure remains the same we will get the same results regardless of how much they spend

Franchise values will keep going up every year too.

Probably the only thing that would make him sell would be IF the NFL got a terrible CBA that made it hard for small market teams to survive. I doubt that ever happens though.

[TheUberHuber]

(11-03-2019, 11:47 AM)fredtoast Wrote: This headline is bullshit.

It was $2 million in salaries and $48 million to stockholders.  The payment to stockholders was probably exactly the same type of shares what other NFL owners/stockholders received.

Our front office is not very competent, but lots of other losing teams also make hundreds of millions of dollars in profits.

Other nfl stockholders include children and inlaws??

[oncemoreuntothejimbreech]

(11-03-2019, 03:23 PM)pally Wrote: If money was all the Brown's were after then selling the team makes more sense than keeping it.  The Bengals are worth $2 billion according to Forbes.  The Browns own 100% of the team so that is cold hard cash that could come their way.  They also could add millions more to their coffers by selling naming rights to PBS.  

The problem goes so much further than dollars and cents.  It starts with an owner who wants to run his team like it is still 1985.  It is an owner who won't let any of the "power" positions go to anyone outside the family and Duke Tobin (who should have been fired with Marvin) who might as well be family at this point.  It's an owner that while smart is almost paralyzed by the idea of change  Its an owner who was raised by the greatest football mind in the history of the NFL who seemingly inherited none of that but seems to think he has.

As long as the ownership and management structure remains the same we will get the same results regardless of how much they spend

That's short term thinking.

From the Enquirer article in 2009 the top estimate of the franchise's value was $1.19 billion.  A decade later and the value has almost doubled just by hanging onto the team while managing to produce one of the worst products in the NFL which is reflected by the horrible attendance numbers.  Why sell now when you're paying your family millions in salary annually and the value is almost certain to increase another billion during the next decade?

[fredtoast]

(11-03-2019, 07:08 PM)TheUberHuber Wrote: Other nfl stockholders include children and inlaws??

Probably?  But who knows.  The point is that it doesn't matter who those payments go to.  Every team pays out profits to stockholdres/owners and it has no effect on what happens on the field.

Paying slalry to employees is different because inept employees can hurt the teams performance.  We can all still complain about that, but just no need for massive exaggeration or spin to try and make it look worse.