Rink operator Black Bear loses bid to sue AHAI for allegedly blocking for-profit rink owners from IL youth hockey

By Scott Holland | May 10, 2019

CHICAGO — A federal judge has dismissed an ice rink operator's attempt to put the Amateur Hockey Association of Illinois in the penalty box over alleged antritrust violations, saying the rink operator can't sue is the AHAI never denied an application for a new youth hockey club for one of its rinks.

In December, Black Bear Sports Group filed a federal complaint saying the AHAI denied a charter and otherwise tried to keep amateur hockey in the state confined to nonprofit organizations in violation of federal antitrust laws. 

Black Bear is based in Chevy Chase, Md., and operates 10 ice rinks nationwide, including Chicago area rinks it bought from 2016 to 2018 in Glen Ellyn, Woodridge, Lincolnwood and Crestwood. The rinks earn money from ice rental for amateur hockey and figure skating, as well as admission fees for public skating hours and amateur hockey club participation fees.

In an opinion issued May 9, U.S. District Judge Matthew Kennelly said the AHAI’s motion to dismiss Black Bear’s complaint is rooted in a dispute over whether the complaint sufficiently alleged an injury.

Kennelly said AHAI bylaws “create significant uncertainty about whether the nonprofit rule actually would bar Black Bear’s application for a club charter.” Although Black Bear operates ice rinks and skating education programs for profit, AHAI rules create exceptions for such facilities, which the AHAI said makes it impossible for Black Bear to argue the rule violates federal law.

AHAI said its bylaw governing applications for the type of charter Black Bear sought “gives the reviewing Association committee nearly boundless discretion,” Kennelly wrote. "Black Bear also took issue with charter application requirements that called for it to identify other hockey clubs a new charter might affect or to list all athletes and programs with which it previously affiliated, but the AHAI said since its committee had such broad power to reject an application, it’s difficult to say what specific component might have led to the charter denial.

“Taken together, these provisions of the governing documents render Black Bear’s allegations of injury too speculative to confer Article III standing,” Kennelly wrote. He said Black Bear didn’t identify any specific AHAI individual or group who “unequivocally stated that the Association would reject an application by Black Bear,” only that it said a club at Black Bear's Center Ice of DuPage rink was "unnecessary.”

Although Black Bear’s complaint said someone “told (Black Bear) that it cannot start a new Tier II club because it is a for-profit enterprise,” Kennelly reiterated it isn’t reasonable to infer an application would be denied as a foregone conclusion.

“The bottom line is that, on the present allegations, Black Bear cannot proceed with this lawsuit without having actually applied for a Tier II club charter,” Kennelly wrote.

Kennelly disagreed with the AHAI’s position that Black Bear would need to exhaust the AHAI appeals process if its club charter application were rejected. He said AHAI bylaws say appeals “may be made” to the AHAI Board of Directors, not must be, and that the bylaw forcing dispute resolution into arbitration applies only to entities already within AHAI jurisdiction, which Black Bear wouldn’t be as only an applicant.

Black Bear also said it lost potential rink rental fees because of a 2018 AHAI rule preventing teams from using ice more than 15 miles from their home rink. Kennelly, however, said Black Bear mischaracterized the rule, as it actually allows teams to use rinks within 15 miles without prior approval, and says those farther out are allowable with committee endorsement.

Further, he said, Black Bear didn’t say it actually applied for such an arrangement, that AHAI rejected an application or that AHAI "or any relevant decision maker has even so much as suggested that such an application would be rejected or would be a waste of time.”

Kennelly granted AHAI’s motion to dismiss and vacated a status hearing set for May 14.

Black Bear is represented in the action by attorneys Paula K. Jacobi and Paul T. Olszowka, of the firm of Barnes & Thornburg LLP, of Chicago.

AHAI is represented by attorneys James H. Mutchnik, Jonathan J. Faria and Donna Peel, of the firm of Kirkland & Ellis LLP, of Chicago.

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Organizations in this Story

Barnes & Thornburg James H. Mutchnik Kirkland & Ellis U.S. District Court for the Northern District of Illinois

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