As negotiations continue on the
potential sale of the Washington Commanders, it's a different multi-billion-dollar transaction by team owner Dan Snyder that sheds light on a potentially important facet of the deal.
Shortly after purchasing the NFL team in 1999, Snyder sold the company where he made his name and fortune, Snyder Communications, to a French firm, Havas Advertising, for $2.1 billion.
In purchasing the company, Havas also assumed legal liability for everything that happened on Snyder's watch.
A year later, Havas found itself having to pay for exactly that — a settlement with Florida's attorney general over the alleged illegal switching of long distance customers.
That process, known as "slamming," occurs when a customer has their long-distance provider switched without their consent.
The allegations were that Snyder Communications
had "slammed" thousands of consumers by forging signatures. Havas, along with Verizon, ended up paying $3.1 million to settle.
Snyder Communications was also banned from doing business in Florida.
At the time, a Snyder spokesperson, Karl Swanson, told The Washington Post that Snyder was unaware of the allegations and the employees involved were fired.
"The company had over 12,000 people in 77 offices all over the world and over $1 billion in annual revenue," Swanson
said. "Clearly, the chief executive doesn't know what everyone's doing on any given day."
The issue of legal indemnity now looms large over Snyder's football team, one that has faced a number of formal and informal investigations over the past three years.
Attorneys general in D.C. and Virginia, among others, have investigations pending into the team's business practices.
The Washington Post, citing anonymous sources, reported that Snyder and his attorneys have asked fellow NFL owners to indemnify him against future legal liabilities and costs if he sells the team.
The team responded in a statement that the story "by the Washington Post regarding the transaction process involving the Washington Commanders is simply untrue.”
NFL teams have carried legal burdens unexpectedly in the past.
Teams were asked to
contribute $7.5 million towards a lawsuit filed by the city of St. Louis when the Rams left for Los Angeles, despite reported assurance by owner Stan Kroenke that he would foot the ball.
NFL owners are scheduled to meet starting on March 26 in Phoenix for the league's annual meeting, where Snyder is sure to be on the agenda.
11 key dates in the timeline of Dan Snyder, Commanders
Minority owners Fred Smith, Dwight Schar and Bob Rothman, whose shares added up to 40.5% of Washington Football Inc., sued Snyder in federal court in Maryland seeking an injunction to allow them to sell their shares of the team.
2014, dean hoffmeyer/TIMES-DISPATCH
The Post reported additional examples of workplace sexual harassment inside the organization, along with allegations that Snyder was personally involved.
The Post reported a former cheerleader saying Snyder invited her to a hotel room with one of his friends, and that longtime team executive Larry Michael made extra cheerleading videos for the owner showing sensitive material that wasn’t made public. Snyder released a statement denying those specific allegations and saying he was unaware of the incidents.
At his pre-Super Bowl virtual news conference, NFL Commissioner Roger Goodell praised the organization, which he said “has made a lot of changes already.” That included
hiring Jason Wright as team president in August.
Goodell said it was good to see those changes, and added he expected Wilkinson’s recommendations would add to them.
Weeks later, 20 former employees wrote a letter to Goodell,
asking the league to release the final report of the investigation when it was completed.
In late March,
Snyder bought out his minority owners, a move that gave his family total control of the team. Snyder’s application for a debt waiver of $450 million was approved by the league’s finance committee and then ownership at-large to make it official.
The NFL fined the team $10 million and said Snyder would step away from day-to-day operations for several months after Wilkinson’s investigation found Washington’s workplace to be toxic and unprofessional, especially for women.
The team did not lose any draft picks, and no formal suspensions were handed out. The league said Snyder’s wife, Tanya, would assume formal operations while he worked on long-term issues such as the search for a new stadium.
No written report was released.
Alex Brandon, Associated Press
Amid calls from former employees for the NFL to release the findings of Wilkinson’s investigation, members of the U.S. Congress got involved.
Rep. Carolyn Maloney, a New York Democrat who is chairwoman of the House Committee on Oversight and Reform, and Rep. Raja Krishnamoorthi, an Illinois Democrat who is chairman of the Subcommittee on Economic and Consumer Policy, wrote to Goodell on Oct. 21 seeking all documents and communications related to the investigation.
A couple of weeks later, the pair of representatives urged the NFL and the team to release individuals from non-disclosure agreements that would prevent them from discussing sexual harassment and workplace issues at the club.
In December, after the Post reported Snyder hired lawyers and private investigators that witnesses viewed as attempts to interfere with the investigation, Maloney and Krishnamoorthi
asked the league to provide evidence and said, “These disturbing revelations have only strengthened the Committee’s commitment to uncovering the truth in this matter.”
Jose Luis Magana, Associated Press
The House Oversight Committee announced Jan. 27 it would hold a roundtable discussion the following week with former employees to discuss workplace misconduct and sexual harassment.
unveiled its new name as the Commanders on Feb. 2.
During the roundtable the following day, one of the former employees
came forward with a new allegation she was sexually harassed by Snyder himself, which he denied. Tiffani Johnston, who worked for the team for eight years starting in 2002 as a cheerleader and marketing manager, told the committee Snyder placed his hand on her thigh without her consent at a team dinner and that he pushed her toward his limousine with his hand on her lower back.
The committee continued to push for the full release of the Wilkinson report,
asking Goodell to release the full findings by Feb. 14 and threatening “alternate means of obtaining compliance” if he did not cooperate.
At the Super Bowl in Los Angeles,
Goodell defended the NFL's use of an oral, not written, report, saying it was done to protect the identity of anyone who wanted to speak to investigators privately, also saying the league would take over an investigation into the new allegation of sexual harassment made against Snyder.
The league hired former U.S. Attorney and Securities and Exchange Commission chair Mary Jo White to investigate, vowing the results would be released in written form because the allegation was made in a public forum.
Manuel Balce Ceneta, Associated Press
On June 1, the committee invited Snyder and Goodell to appear at a hearing on workplace culture around the NFL scheduled for later in the month, which it called the next step in the investigation.
Two weeks later, a
lawyer representing Snyder said he would not testify. Among the reasons given were a lack of assurance about the scope of questioning given the existence of multiple ongoing investigations and a scheduling conflict preventing Snyder from appearing in person.
On June 9, the Virginia General Assembly
abandoned for the rest of the year a stadium deal that would have brought the Commanders' games to the state. The legislation offering hefty tax incentives had already been languishing amid a series of controversies involving the team when an assistant coach called the Jan. 6 insurrection at the Capitol “a dust-up.” Goodell testified virtually on June 22, and the committee released a document accusing Snyder of conducting a “shadow investigation” that sought to discredit former employees making accusations of workplace sexual harassment, hired private investigators to intimidate witnesses and used an overseas lawsuit as a pretext to obtain phone records and emails.
Asked by one member of the committee whether he would remove Snyder as Washington’s owner, Goodell responded, “I don’t have the authority to remove him."
An NFL owner can only be removed by a three-quarters majority vote of the other owners.
Jacquelyn Martin, Associated Press
wrangling between his legal team and the committee over the parameters of his testimony, Snyder agreed to appear virtually.
Snyder testified for more than 10 hours on July 28. A spokesperson for Snyder said he “fully addressed all questions about workplace misconduct, described the Commanders’ dramatic two-year transformation and expressed hope for the organization’s bright future.”
Manuel Balce Ceneta
ESPN released a lengthy report detailing Snyder’s efforts to influence other owners and the league office to maintain control of the team.
ESPN reported, citing anonymous sources, that Snyder hired private investigators and told people he has enough information to expose fellow owners and Goodell.
Days later, at the NFL owners' meetings in New York on Oct. 18,
Indianapolis Colts owner Jim Irsay said there was “merit to remove” Snyder — the first public statement by one of Snyder's counterparts that he should go.
During Washington's next game, at home against Green Bay, spectators shouted “Sell the team!” when Tanya Snyder was shown on a video board.
Susan Walsh, Associated Press
The Snyders took the first step
toward potentially selling the Commanders: The club announced on Nov. 2 that a financial services firm had been hired to “consider potential transactions.” Asked if the Snyders were considering selling part or all of the team, which is worth billions of dollars, a spokesperson said, “We are exploring all options.”
Eight days later, the D.C. attorney general made public his investigation, which he said began in the fall of 2021. As for whether Snyder can avoid the civil suit by ending his ownership, Racine said: "If he sells the team, he’s still a defendant.”
The investigations by White and Congress
remain ongoing. The team still does not have a deal for a new stadium and ranks last in the NFL in average home attendance.
Susan Walsh, Associated Press