Chargers May Be in Violation of Their Stadium Lease

There could be a way for the City to delay a move to L.A.

This week’s popular opinion on the NFL’s quest to return to Los Angeles has the league only moving one team (the Rams) back for the 2016 season, leaving the Chargers and Raiders to continue trying to work things out with their home markets.

It would behoove the Chargers to do just that because they very well might be in default of their current lease agreement at Qualcomm Stadium.

We’ve all heard about the annual window the Chargers have from February 1 through May 1 to terminate their lease and move away. However, it works both ways. According to the official document, the city has the ability to terminate the lease as well, as long as proof can be provided that the Chargers are in default of the agreement.

It’s found in Section 25: Remedies of the City, which reads in part:

“Any election on the part of the city to terminate this Agreement must be in writing, properly executed by the city and served upon the Chargers.  No termination of this Agreement on account of a default by the Chargers shall be or become effective by operation of law or otherwise, unless and until the City shall have given such written notice to the Chargers.”

(Click here to read the lease)

So now we have to see where the default is. Believe it or not, there is something that can be considered a breach of the contract. In Supplement Number Eight to the Agreement, we find Section 3.2 Long-Term Stadium Development, which states:

“The Parties shall meet and confer on a mutually convenient basis to discuss the development of a proposal for the financing and development of a new stadium to be voted on by the general public.  Neither Party is obligated to participate in the financing or development of a new stadium, and the Parties acknowledge that there is no assurance the (a) the Parties will arrive at a mutually satisfactory proposal, (b) such a proposal will be submitted to a public vote, of (c) if submitted, such proposal will be approved by the general public.”

You may remember the June 17 meeting in City Attorney Jan Goldsmith’s office when the Chargers walked away from negotiations. They have not returned since. Members of the Mayor’s office and the Citizens Stadium Advisory Group (CSAG) have been vocal in their claims the Chargers have refused to negotiate in good faith. Given the circumstances it could be successfully argued in a court of law that the team has put themselves in default of the stadium lease by refusing to “meet and confer on a mutually convenient basis.”

When asked for comment City Attorney Goldsmith’s office told NBC 7 SportsWrap in a statement, “Although we have provided advice to the City on that, we cannot discuss that publicly.”

Chargers Special Counsel Mark Fabiani also commented on the possibility the Chargers being in default: "We have worked for 14 years, developing and submitting nine separate proposals. So that accusation is ludicrous."

The City could then counter, arguing that was a different time with different leadership that cannot be held against the current, motivated group. And on and on it goes.

So it appears the City of San Diego does have the makings of a case to prove the Chargers are in default of their lease, which would give City Hall the power to terminate the entire agreement and kick the Chargers out of Qualcomm Stadium and their Murphy Canyon practice facility which was also built by the city. If they get tired of the vitriol, one could certainly see the temptation to do just that. However, it is probably highly unlikely the Mayor’s office would have any interest in that course of action.

No city wants to be known as the place that told the NFL to take a hike. That’s simply not good for one’s national reputation.

There’s another, more likely way to use this legal tactic, and it’s completely opposite the first scenario.

The City could effectively force the Chargers to come back to the negotiating table. If the NFL does, indeed, decide to only put the Rams in L.A., for 2016 the Chargers would still have to play at Qualcomm Stadium, something they cannot do without a lease agreement. That is one heck of a bargaining chip in the City’s favor.

The specter of having a team with no place to play for an entire season could put the NFL into crisis mode. Commissioner Roger Goodell would have to either proceed with moving the Chargers to Los Angeles as a second tenant with Stan Kroenke’s club in Inglewood (good luck getting Kroenke to agree to something like that when it’s not on his terms), including finding a place for them to play and practice until the new stadium is built … or force the team to work it out in San Diego.

Working it out in San Diego would then mean either getting back to negotiations on construction of a new stadium or renegotiating a brand new lease at Qualcomm. In that case it’s extremely likely the City would push for a new agreement that makes it exponentially more difficult for the Bolts to leave San Diego County than the current lease.

It’s amazing to think about, but in reality the biggest monkey wrench in the Chargers moving to L.A. could be two sentences on the 26th page of the eight supplement to the lease agreement between the team and the City of San Diego.

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