BREAKING: A lawsuit has been filed against the Phoenix Suns by two minority owners, escalating tensions within the organization. The lawsuit, lodged in Delaware on August 21, 2024, claims that current owner Mat Ishbia has denied access to critical internal records necessary for the minority owners to fulfill their roles.
The plaintiffs, Andy Kohlberg and Scott Seldin, represent Kisco WC Sports II and Kent Circle Investments, respectively. Both were minority shareholders under Robert Sarver, who sold the team in 2023 under scrutiny from an NBA investigation. Ishbia acquired a 57% controlling stake for $2.28 billion, with Sarver selling his share for $1.48 billion.
In a statement, the attorneys representing Kohlberg and Seldin emphasized the urgency of transparency: “Our clients sued to obtain records to which they are entitled as minority owners of the Suns… Transparency with minority owners is not optional,” they asserted.
This lawsuit marks the sixth legal challenge faced by the Suns since November 2023, with previous cases brought by current and former employees alleging various issues, including discrimination and wrongful termination. The mounting legal pressures suggest a turbulent environment within the organization.
According to the complaint, Kohlberg began negotiating a buyout with Ishbia’s adviser in September 2024, while Seldin opted not to pursue a buyout. Kohlberg’s negotiations extended into 2025, culminating in a request for a final response by June 1. However, the day after his deadline, Ishbia reportedly called for a capital raise, which the lawsuit claims was intended to “exert pressure” on minority shareholders.
The plaintiffs also allege that Ishbia entered into undisclosed agreements with other ownership members, complicating financial transparency. They expressed particular concern over the funding of the Phoenix Mercury’s new $100 million practice facility, unveiled in July 2024, for which Ishbia provided minimal financial disclosures.
In response to the lawsuit, the Suns contended that Kohlberg and Seldin’s demands for a buyout at $825 million—valuing the team at $6 billion—are unreasonable and unsubstantiated. The Suns’ legal representatives stated, “Ishbia does not intend to reduce or slow his investments in the company… He will continue doing whatever it takes to position the Suns and Mercury to win championships.”
The letter also accused Kohlberg and Seldin of employing “baseless litigation and sensationalized press coverage” to intimidate Ishbia into negotiating a buyout, emphasizing that such tactics would not succeed.
As this situation develops, the Phoenix Suns face not only internal discord but also the potential for further legal complications. Fans and stakeholders are watching closely as the team navigates these challenges, with implications for its financial health and operational transparency.
Stay tuned for updates on this unfolding story as it impacts the future of the Suns and their management dynamics.