In an opinion by Judge Whitehill, the Business Court has issued a second lengthy opinion in a dispute between the Dallas Mavericks and theDallasStars over ownership of a company that operates the American Airlines Center.
Dallas Sports Group, LLC and Radical Arena, Ltd. v. DSE Hockey Club, L.P. and Dallas Sports & Entertainment, L.P. (26 Tex. Bus. 36; June 3, 2026) is the next phase of a contract dispute between the Dallas Mavericks and the Dallas Stars. The litigation arose from a disagreement between the Dallas Mavericks and the Dallas Stars over the ownership of Center Operating, L.P., which contracted with the City of Dallas to operate the American Airlines Center. They also co-own the partnership’s general partner, Center GP, LLC. The Mavs claim that they redeemed the Stars’ ownership interests in both entities and that the Stars have since interfered with the Mavs’ right to control the entity. They filed suit for declaratory judgment. The Stars moved for summary judgment. The question before the court was “whether the parties’ ‘Location Commitments’ require that the ‘Teams’’ principal, public-facing presence be in Dallas, Texas?”
In a 91-page opinion by Judge Whitehill, the court concluded “as a matter of law that the Location Commitments have only one reasonable meaning: ‘Owners’ are required to designate and maintain in Dallas the principal corporate and executive offices of their respective ‘Team,’ rather than the ‘Owner’s’ own such offices.” And according to the court, “the evidence conclusively establishes that at all relevant times the Mavs have complied with this requirement—and the Stars have not.” The court further held that the Mavs’ redemption letter and accompanying cash tender was a sufficient method to cause the recdemption.The court thus denied the Stars’ MSJ and granted the Mavs’ declaratory judgment and affirmative defenses motions. The Mavs’ remaining tortious interference claim remained pending and was set for trial on May 11.
In this next phase of the litigation, the parties asked the court “to opine regarding its May 5, 2026 orders deciding that (i) the Mavericks’ redemption letter and cash tender method was alsoPeffective as to Dallas Sports & Entertainment (DSELP); (ii) the Court’s April 2, 2026, summary judgment rulings negated the Stars’ declaratory judgment counterclaim; and (iii) the Stars’ 2011 bankruptcy was not a defense to the Mavericks’ claims.”
As to the first question, the court ruled that the Mavs’ redemption method was effective as to DSELP (the Mavs directed the redemption letter to the Hockey Club). The Stars argued that a fact issue existed as to whether DSELP received the payment, the Mavs couldn’t establish as a matter of law that Hockey Club (a wholly owned subsidiary of DSELP) received payment as DSELP’s agent, and that DSELP, consequently, was not bound by the summary judgment. The court rejected these arguments, observing that “the evidence conclusively establishes that DSELP received the redemption letter and cash tender (or Hockey Club was DSELP’s agent). And under Texas law, as enunciated by SCOTX in International Bankers Life Co. v. Holloway, 368 S.W.2d 567 (Tex. 1963), “actual notice to a corporate officer or agent is notice to the corporation where that person, in the scope of his or her duties to the corporation, should and reasonably could communicate that knowledge to the corporation.” There was no dispute that the Mavs sent the redemption letter to a corporate officer of that description. In fact, it quickly ended up in the hands of “DSELP’s owner, highest ranking corporate executives, and at least two of its general partner’s directors” and they discussed it. It didn’t help the Stars’ case that DSELP’s CFO, who offices at the address in the letter’s addressee block, admitted to receiving the cash and deposited it. The sumnmary judgment thus bound DSELP, as well as the Mavs’ ability to redeem the Stars’ interests.
The court further rejected DSELP’s due process argument. The Stars contended that binding DSELP to the summary judgment order “when the court added DSELP as a party little more than a week before March 6, 2026, summary judgment hearing deprived DSELP of its due process and due course rights under the federal and state constitutions.” The court reasoned that DSELP “had a fair opporunity to defend itself and its due process and due course rights were not deprived because it (1) had notice of the claims and suit from the outset; (ii) had an identical financial interest in the outcome as Hockey Club; (iii) and was in privity with Hockey Club such that DSELP would be bound by collateral estoppel had it been sued separately.” In fact, DSELP knew full well about the dispute, controlled its defense, shared identical economic interests with Hockey Club, didn’t object to the joinder order stating that DSELP would be bound by the pending summary judgment order, failed to make arguments specific to it, was represented by the same counsel, failed to explain any prejudice, and didn’t move for a continuance. Hard to assert due process and due course under those circumstances.
Next, the court determined that its prior ruling that the Mavs’ prevailed on their declaratory judgment action negated the Stars’ declaratory judgment counterclaim “because that counterclaim did not assert unique issues not already implicated by the Mavericks’ declaratory judgment action. . . . The Stars’ counterclaim did not add any issues, defenses, or affirmative claims that the court’s May 26th final judgment did not explicitly or implicitly resolve.” That judgment, as we reported last spring, decided the Mavs’ relocation issue against the Stars, rendering the Stars’ declaratory judgment claims moot. Finally, the court held that the Stars’ 2011 bankruptcy didn’t bar the Mavs’ claims. In short, the dispute being litigated in this case arose from an agreement imposing the Location Commitment and Relocation Event that occurred post-bankruptcy. Additionally, the Stars failed to preserve their alleged res judicata defense by not asserting it in response to the Mavs’ summary judgment motion.
