1
00:00:02,840 --> 00:00:07,680
Speaker 1: This is Bloomberg Law. Some complicated international law issues here.

2
00:00:07,960 --> 00:00:11,760
Speaker 1: What kind of docket is Chief Justice Roberts facing interviews

3
00:00:11,840 --> 00:00:14,960
Speaker 1: with prominent attorneys and Bloomberg Legal experts. Joining me is

4
00:00:15,000 --> 00:00:18,759
Speaker 1: Bloomberg New Supreme Court reporter Greg Store, Neil Devon's professor

5
00:00:18,800 --> 00:00:21,880
Speaker 1: at William and Mary Law School, and analysis of important

6
00:00:21,960 --> 00:00:25,680
Speaker 1: legal issues cases and headlock. Is this essentially the fifth

7
00:00:25,720 --> 00:00:29,120
Speaker 1: circuit haunting He has presided over a so called hot

8
00:00:29,160 --> 00:00:32,519
Speaker 1: bench at the Supreme Court. Bloomberg Law with June Grosso

9
00:00:32,800 --> 00:00:40,520
Speaker 1: from Bloomberg Radio. Welcome to Bloomberg Law on Bloomberg Radio.

10
00:00:40,600 --> 00:00:43,400
Speaker 1: I'm Joe Shorts living for June Grosso. Coming up on

11
00:00:43,440 --> 00:00:47,879
Speaker 1: the show Highlights from the High Court. We'll also discuss

12
00:00:47,960 --> 00:00:51,120
Speaker 1: what's next for the vaccine mandate case at the Supreme

13
00:00:51,159 --> 00:00:54,680
Speaker 1: Court will decide soon, plus the future of ownership of

14
00:00:54,720 --> 00:00:58,760
Speaker 1: the Denver Broncos. But we begin with cybersecurity, supply chain

15
00:00:58,800 --> 00:01:02,520
Speaker 1: attacks and software exploitations. They are set to continue into

16
00:01:02,560 --> 00:01:05,959
Speaker 1: next year with no signs of reprieve. They post reputational

17
00:01:06,000 --> 00:01:08,800
Speaker 1: and regulatory risk for businesses as well as legal ones.

18
00:01:09,000 --> 00:01:11,240
Speaker 1: To discuss some of those legal risks, we bring in

19
00:01:11,360 --> 00:01:15,000
Speaker 1: Brandon van Grack partner and co chair of Morrison and

20
00:01:15,080 --> 00:01:19,200
Speaker 1: Forresters National Security and Global Risk and Criscent Management Group.

21
00:01:19,560 --> 00:01:25,720
Speaker 1: Let's talk about ransomware attacks. Obviously very troublesome as it

22
00:01:25,760 --> 00:01:30,560
Speaker 1: relates to ransomware attacks, What does two look like? I mean,

23
00:01:30,840 --> 00:01:34,480
Speaker 1: have we learned anything yet? Is really going to be

24
00:01:34,520 --> 00:01:37,559
Speaker 1: a bell weather to sort of whether we are taking

25
00:01:37,600 --> 00:01:41,280
Speaker 1: the right we being sort of the US government in

26
00:01:41,319 --> 00:01:43,240
Speaker 1: the U S. Public as a whole, are taking the

27
00:01:43,360 --> 00:01:46,280
Speaker 1: right approach to ransomware. I think what you've seen in

28
00:01:46,319 --> 00:01:49,520
Speaker 1: the last couple of years, as you said, is supposed

29
00:01:49,520 --> 00:01:53,480
Speaker 1: to be the year ransomware has much worse. So I

30
00:01:53,480 --> 00:01:55,800
Speaker 1: don't I don't know what the um you know, what

31
00:01:55,960 --> 00:01:59,800
Speaker 1: the next level is. But one was obviously very very

32
00:01:59,800 --> 00:02:03,000
Speaker 1: bad at But at the same time we saw in

33
00:02:04,480 --> 00:02:07,080
Speaker 1: really for the first time the U. S. Government treat

34
00:02:07,600 --> 00:02:11,680
Speaker 1: ransomware as a national security threat and used tools in

35
00:02:11,720 --> 00:02:14,919
Speaker 1: ways we've never seen before with respect to the threat.

36
00:02:15,040 --> 00:02:17,880
Speaker 1: And so really what we're going to see in two

37
00:02:18,000 --> 00:02:21,560
Speaker 1: is is it working? You know our in fact, is

38
00:02:21,600 --> 00:02:25,720
Speaker 1: this approach an effective approach? And I think we'll really

39
00:02:25,960 --> 00:02:29,640
Speaker 1: um be able to see early in whether it's working

40
00:02:29,720 --> 00:02:32,360
Speaker 1: or not, because the reality is I think most people

41
00:02:32,360 --> 00:02:34,160
Speaker 1: would say, even as the year comes to an end

42
00:02:34,160 --> 00:02:37,960
Speaker 1: of it has still been a record year in terms

43
00:02:37,960 --> 00:02:39,720
Speaker 1: of how bad the threat has been. And when you

44
00:02:39,760 --> 00:02:42,160
Speaker 1: talk about is it working, what are you referring to

45
00:02:42,800 --> 00:02:45,040
Speaker 1: a whole bunch of things. When it comes to the

46
00:02:45,160 --> 00:02:50,680
Speaker 1: US government, UH, it's really adopted UH sort of almost

47
00:02:50,680 --> 00:02:53,720
Speaker 1: a paradigm shift in terms of dealing with the issue

48
00:02:53,760 --> 00:02:57,160
Speaker 1: of ransomware and again treating it as a national security threat,

49
00:02:57,240 --> 00:03:01,040
Speaker 1: which means the US government is trying to us all

50
00:03:01,080 --> 00:03:04,640
Speaker 1: of its tools to address the threat, and so some

51
00:03:04,800 --> 00:03:08,760
Speaker 1: of that are criminal charges. The Justice Department has charged

52
00:03:08,760 --> 00:03:12,440
Speaker 1: a number of individuals and entities involved in ransomware attacks.

53
00:03:12,919 --> 00:03:16,280
Speaker 1: It involves seizing some of the money, some of the

54
00:03:16,400 --> 00:03:19,800
Speaker 1: ransoms that have been paid from these ransomware actors. It

55
00:03:19,919 --> 00:03:24,600
Speaker 1: involves sanctions, which are another tool the U S Government

56
00:03:24,639 --> 00:03:28,440
Speaker 1: has that bans the provision of goods their services to

57
00:03:29,360 --> 00:03:33,480
Speaker 1: UH entities or individuals involved in these ransomware attacks. It

58
00:03:33,560 --> 00:03:37,600
Speaker 1: involves international cooperation, getting cooperation from other governments and other

59
00:03:37,720 --> 00:03:40,880
Speaker 1: entities in these attacks. It also involves, and this was

60
00:03:41,040 --> 00:03:46,160
Speaker 1: quite remarkable, the US military, the US Cyber Command, confirming

61
00:03:46,200 --> 00:03:49,960
Speaker 1: that they have been assisting with trying to disrupt these

62
00:03:50,040 --> 00:03:54,360
Speaker 1: ransomware attacks and actually were engaged in offensive operations to

63
00:03:54,440 --> 00:03:57,800
Speaker 1: try to disrupt these ransomware actors. And so everything that

64
00:03:57,840 --> 00:04:00,840
Speaker 1: I just went through, and I probably doubts four or

65
00:04:00,960 --> 00:04:04,680
Speaker 1: five other things, are all actions that we just really

66
00:04:04,720 --> 00:04:09,240
Speaker 1: haven't seen before in this space. And the purpose of

67
00:04:09,280 --> 00:04:12,600
Speaker 1: all these actions are to change the cost of benefit

68
00:04:12,600 --> 00:04:16,240
Speaker 1: analysis for these ransomware actors. The ransomware groups, they're not

69
00:04:16,279 --> 00:04:21,160
Speaker 1: they're not ideologues. Uh, they're pragmatists. Their individuals and entities

70
00:04:21,200 --> 00:04:24,320
Speaker 1: that have you know, made a cost of benefit analysis

71
00:04:24,360 --> 00:04:26,800
Speaker 1: that there is profit to be had, and so you

72
00:04:26,880 --> 00:04:30,440
Speaker 1: have the US government now really trying to reduce those

73
00:04:30,480 --> 00:04:33,240
Speaker 1: benefits and raise the costs. And we're going to see whether,

74
00:04:33,320 --> 00:04:36,919
Speaker 1: in fact, you know, they've they've done enough of a

75
00:04:37,000 --> 00:04:40,120
Speaker 1: job to really change that behavior. What percentage do you

76
00:04:40,160 --> 00:04:44,400
Speaker 1: think of ransomware attacks still go unreported? I mean, for years,

77
00:04:44,440 --> 00:04:47,120
Speaker 1: everybody you never heard about this, Nobody wanted to talk

78
00:04:47,120 --> 00:04:49,320
Speaker 1: about it. Everybody was ashamed or you know, I didn't

79
00:04:49,320 --> 00:04:51,839
Speaker 1: want to admit that it happened to them. Today, what

80
00:04:51,880 --> 00:04:55,640
Speaker 1: do you let's just say, you know, the past year,

81
00:04:55,760 --> 00:04:59,200
Speaker 1: what percentage of tax of attacks went unreported. You think

82
00:04:59,560 --> 00:05:02,680
Speaker 1: so the I think the the best sis they can

83
00:05:02,720 --> 00:05:06,719
Speaker 1: give is a lot still coin reported. Um, And I

84
00:05:06,760 --> 00:05:09,360
Speaker 1: think what you've seen is really the U. S. Government.

85
00:05:09,400 --> 00:05:11,640
Speaker 1: One of the ways they've tried to address the issue

86
00:05:11,760 --> 00:05:15,159
Speaker 1: is to really encourage more reporting. It's really been a

87
00:05:15,200 --> 00:05:17,960
Speaker 1: focus of this, the same thing I've been talking about

88
00:05:18,000 --> 00:05:20,480
Speaker 1: in terms of the use of all tools. Really in

89
00:05:20,600 --> 00:05:23,479
Speaker 1: order for the U. S. Government to figure out how

90
00:05:23,520 --> 00:05:25,400
Speaker 1: bad the problem is and to fix it, they need

91
00:05:25,440 --> 00:05:27,760
Speaker 1: more information. And still there's a lot that are not

92
00:05:27,800 --> 00:05:30,400
Speaker 1: being reported. I think you have to not only is

93
00:05:30,440 --> 00:05:32,839
Speaker 1: that what what all experts say, but you have to

94
00:05:32,839 --> 00:05:35,400
Speaker 1: accept that as a given. Uh. And so part of

95
00:05:35,440 --> 00:05:38,200
Speaker 1: it is to you, I think implicit in your question

96
00:05:38,400 --> 00:05:42,000
Speaker 1: is both the US government but just generally the U. S.

97
00:05:42,040 --> 00:05:45,359
Speaker 1: Public has to find ways to improve reporting. And so

98
00:05:45,440 --> 00:05:47,440
Speaker 1: I think that is a key feature, and I think

99
00:05:47,440 --> 00:05:49,279
Speaker 1: it remains a key focus of the U. S. Government

100
00:05:49,279 --> 00:05:51,560
Speaker 1: to try to to try to improve on that. As

101
00:05:51,600 --> 00:05:54,560
Speaker 1: an attorney here and representing any of these companies are

102
00:05:54,560 --> 00:05:57,080
Speaker 1: looking into this issue, what do you have to say

103
00:05:57,120 --> 00:06:00,000
Speaker 1: when it comes to deciding to pay? First of all,

104
00:06:00,080 --> 00:06:02,600
Speaker 1: not everyone done. You know this is this is a

105
00:06:02,680 --> 00:06:07,440
Speaker 1: volume game, and so certainly many do, but but not

106
00:06:07,520 --> 00:06:11,120
Speaker 1: everyone does. The reality, though, is it is a complex

107
00:06:11,600 --> 00:06:14,080
Speaker 1: question in terms of whether to determine whether to pay

108
00:06:14,160 --> 00:06:18,320
Speaker 1: or not. And uh, the other sort of layer to

109
00:06:18,480 --> 00:06:20,560
Speaker 1: it is that they are also US laws that we

110
00:06:20,640 --> 00:06:23,560
Speaker 1: have to be mindful of when you're contemplating whether to

111
00:06:23,560 --> 00:06:26,440
Speaker 1: make a payment. There are, like I mentioned, sanctions, and

112
00:06:26,480 --> 00:06:29,960
Speaker 1: there are some actors that cannot be paid without violating

113
00:06:30,040 --> 00:06:33,360
Speaker 1: US law. And there are some types of now exchanges

114
00:06:33,400 --> 00:06:36,120
Speaker 1: that can't be engaged with without violating US law. And

115
00:06:36,240 --> 00:06:40,040
Speaker 1: so there's there's an additional layer of complexity to decision

116
00:06:40,080 --> 00:06:42,400
Speaker 1: making process that didn't really exist not too long ago.

117
00:06:42,760 --> 00:06:47,000
Speaker 1: Brandon van Grack of Morrison and Forrester, we appreciate you

118
00:06:47,320 --> 00:06:51,520
Speaker 1: taking time and joining us today on Bloomberg Law. My pleasure.

119
00:06:51,560 --> 00:06:54,760
Speaker 1: Thank you. Oh, we'll sell the Denver Broncos the owner

120
00:06:54,800 --> 00:06:57,680
Speaker 1: of the team presumably, But it's a little more complicated

121
00:06:57,680 --> 00:07:00,200
Speaker 1: than that. That involves a legal issue, they think. After

122
00:07:00,240 --> 00:07:03,480
Speaker 1: the nineteen eighties, the last time ownership of the NFL

123
00:07:03,560 --> 00:07:07,359
Speaker 1: franchise switched hands. Andrew Schwartz, professor of law at the

124
00:07:07,440 --> 00:07:10,480
Speaker 1: University of Colorado, explores this issue. He and I spoke

125
00:07:10,520 --> 00:07:12,760
Speaker 1: about the case that could lead to the sale of

126
00:07:12,800 --> 00:07:16,200
Speaker 1: the team. All right, So this goes back to nine

127
00:07:17,720 --> 00:07:23,000
Speaker 1: four when Pat Boland bought the franchise. Boland bought this

128
00:07:23,080 --> 00:07:29,200
Speaker 1: franchise from Edgar Kaiser. Correct, yes, and that's that's exactly right.

129
00:07:29,680 --> 00:07:34,680
Speaker 1: And so when Edgar Kaiser sold the Denver Broncos in

130
00:07:36,480 --> 00:07:40,120
Speaker 1: one of the terms that the two parties agreed to

131
00:07:40,560 --> 00:07:45,080
Speaker 1: was a so called right of first refusal. And what

132
00:07:45,200 --> 00:07:49,160
Speaker 1: that just means is that if the new owner, Bolan

133
00:07:49,840 --> 00:07:53,080
Speaker 1: were to go ahead and want to sell the team

134
00:07:53,080 --> 00:07:57,760
Speaker 1: at some time in the future, Kiser had the right

135
00:07:58,600 --> 00:08:03,360
Speaker 1: to match what ever offer Boland was willing to take,

136
00:08:04,040 --> 00:08:10,320
Speaker 1: and if he did so, then Kaiser would exercise his

137
00:08:10,960 --> 00:08:14,320
Speaker 1: sort of option to buy the team through that right

138
00:08:14,440 --> 00:08:18,080
Speaker 1: of first refusal. All right, and Mr Kaiser held us

139
00:08:18,080 --> 00:08:22,520
Speaker 1: write a first refusal. But upon his death, uh tell

140
00:08:22,600 --> 00:08:26,680
Speaker 1: us what happened with that right of first refusal? Right?

141
00:08:27,360 --> 00:08:32,000
Speaker 1: According to the news that I've read, is that sometime

142
00:08:33,040 --> 00:08:40,160
Speaker 1: after that, Mr Kaiser transferred his contractual right of first

143
00:08:40,200 --> 00:08:45,840
Speaker 1: refusal to a corporation, a new entity that I suppose

144
00:08:46,000 --> 00:08:51,360
Speaker 1: he created for this purpose. It's called R O f

145
00:08:51,920 --> 00:08:57,320
Speaker 1: R Holdings Limited. So write a first refusal, um and

146
00:08:57,720 --> 00:09:03,160
Speaker 1: so this new entity holds the right of first refusal.

147
00:09:03,440 --> 00:09:08,000
Speaker 1: And at some point uh Mr Kaiser passed away and

148
00:09:08,120 --> 00:09:15,040
Speaker 1: now the current owners Bolan or Bolen successors are considering

149
00:09:15,160 --> 00:09:19,800
Speaker 1: selling the Denver Broncos and R O f R Holdings

150
00:09:20,120 --> 00:09:23,920
Speaker 1: has come along with a letter and notification to the

151
00:09:23,960 --> 00:09:27,960
Speaker 1: current owners saying, if you are about to accept an

152
00:09:27,960 --> 00:09:32,480
Speaker 1: offer from someone, we have the right of first refusal

153
00:09:32,520 --> 00:09:37,480
Speaker 1: to match that offer. Okay, So it's an unusual confrontation

154
00:09:37,559 --> 00:09:39,880
Speaker 1: involves the estates of two of the teams to cease

155
00:09:39,880 --> 00:09:44,760
Speaker 1: owners and one mysterious lender uh again, Pat Bolland bought

156
00:09:44,760 --> 00:09:47,720
Speaker 1: the franchise, Native fourth Meder Kaiser, who sold a bowling

157
00:09:47,760 --> 00:09:52,440
Speaker 1: the team, and an Arizona businessman named Scott Schrimmer, who,

158
00:09:52,440 --> 00:09:55,679
Speaker 1: along with Kaiser's estate, owns the entity. Note, as you

159
00:09:55,760 --> 00:10:00,439
Speaker 1: pointed out, R O f R Holdings, Okay, it's sounds

160
00:10:00,480 --> 00:10:08,240
Speaker 1: fine so far, but is it well? The core principle

161
00:10:08,320 --> 00:10:11,160
Speaker 1: of contract law is that parties are free to make

162
00:10:11,200 --> 00:10:14,480
Speaker 1: the agreements that they wished. It's called freedom of contract.

163
00:10:15,080 --> 00:10:20,480
Speaker 1: And in this case, the contract of sale said Kaiser,

164
00:10:20,720 --> 00:10:24,880
Speaker 1: you get the right of first refusal, but this right

165
00:10:25,559 --> 00:10:32,480
Speaker 1: can only be transferred to a subsidiary of you Kaiser,

166
00:10:33,200 --> 00:10:37,000
Speaker 1: which which Kaiser's position is that R O f R

167
00:10:37,120 --> 00:10:41,200
Speaker 1: Holdings was and I suppose continues to be that sort

168
00:10:41,200 --> 00:10:44,880
Speaker 1: of subsidiary, and the Denver Broncos, I think the current owners,

169
00:10:45,160 --> 00:10:49,040
Speaker 1: it's my understanding, they take the position that R O

170
00:10:49,240 --> 00:10:54,040
Speaker 1: f R Holdings is not can no longer exercise this

171
00:10:54,160 --> 00:10:58,240
Speaker 1: right of first refusal under the terms of the contract

172
00:10:58,720 --> 00:11:02,280
Speaker 1: because the ownership is ventially changed there and involving this

173
00:11:02,360 --> 00:11:07,760
Speaker 1: other Arizona businessman, I think the Arizona businessman was involved

174
00:11:07,840 --> 00:11:13,600
Speaker 1: in financing some other litigation between these parties, and as

175
00:11:13,679 --> 00:11:18,200
Speaker 1: part of the transaction, I suppose I've received a piece

176
00:11:18,400 --> 00:11:22,440
Speaker 1: of R O f R Holding right. Okay. So obviously

177
00:11:22,480 --> 00:11:25,880
Speaker 1: this is a significant issue for the Denver Broncos because

178
00:11:25,920 --> 00:11:28,040
Speaker 1: nobody is going to want to step in and try

179
00:11:28,080 --> 00:11:31,719
Speaker 1: to buy and have an NFL franchise and spend the

180
00:11:31,800 --> 00:11:34,800
Speaker 1: hundreds of thousands of dollars just to even get to

181
00:11:34,920 --> 00:11:39,400
Speaker 1: a point of a possible sale or purchase if they

182
00:11:39,440 --> 00:11:42,360
Speaker 1: know at the last second it could just be swept

183
00:11:42,400 --> 00:11:45,640
Speaker 1: away by somebody else's right of a first refusal. Correct,

184
00:11:47,160 --> 00:11:50,480
Speaker 1: That is that is exactly correct. Um. One point to

185
00:11:50,920 --> 00:11:54,319
Speaker 1: note is that the holder of the rate of first

186
00:11:54,360 --> 00:11:59,560
Speaker 1: refusal would have to show that he's quote ready, willing

187
00:11:59,600 --> 00:12:03,560
Speaker 1: and able to exercise and to match at that point,

188
00:12:04,000 --> 00:12:07,400
Speaker 1: and it might be an open question whether R O

189
00:12:07,600 --> 00:12:13,200
Speaker 1: f R Holdings has the financial wherewithal to match a

190
00:12:13,280 --> 00:12:17,640
Speaker 1: multibillion dollar offer. We haven't reached that point yet, all right,

191
00:12:17,679 --> 00:12:19,920
Speaker 1: So we're talking with Andrew Schwartz. He's a professor at

192
00:12:19,960 --> 00:12:23,480
Speaker 1: the University of Colorado School of Law, and we're talking

193
00:12:23,559 --> 00:12:26,559
Speaker 1: about this lawsuit that may pave the way for a

194
00:12:26,640 --> 00:12:30,560
Speaker 1: Denver Broncos sale. Okay, so legally, you look at both

195
00:12:30,600 --> 00:12:35,120
Speaker 1: sides here, you've seen this in great detail. Uh, what

196
00:12:35,160 --> 00:12:40,120
Speaker 1: do you say about how this gets resolved? Well? Uh,

197
00:12:40,400 --> 00:12:43,200
Speaker 1: to be honest, I had not looked very closely at

198
00:12:43,240 --> 00:12:49,160
Speaker 1: the fact of this particular case. However, in general, what

199
00:12:49,400 --> 00:12:52,959
Speaker 1: will come down to is, I think a very close

200
00:12:53,080 --> 00:12:57,640
Speaker 1: analysis of the precise language in the contract and then

201
00:12:58,280 --> 00:13:02,240
Speaker 1: precisely what was done as a matter of corporate law

202
00:13:02,520 --> 00:13:06,120
Speaker 1: with creating this do entity R O f R Holding

203
00:13:06,280 --> 00:13:13,719
Speaker 1: Limited transferring the right in corporate law visit a corporate entity. Um. Ever,

204
00:13:13,880 --> 00:13:19,480
Speaker 1: everything is technicalities and everything is procedure um. So it'll

205
00:13:19,520 --> 00:13:23,720
Speaker 1: be a question of whether precisely what was allowed by

206
00:13:23,760 --> 00:13:30,120
Speaker 1: the contract was precisely executed by Kaiser and this corporation. Now,

207
00:13:30,120 --> 00:13:33,280
Speaker 1: looking at this dow Jones article here on this particular topic,

208
00:13:33,320 --> 00:13:34,960
Speaker 1: it says one of the pieces of evidence was a

209
00:13:35,040 --> 00:13:39,719
Speaker 1: video deposition of Kaiser taken from prior litigation, and in

210
00:13:39,840 --> 00:13:42,640
Speaker 1: that Kaiser states of the video that he understood the

211
00:13:42,720 --> 00:13:45,400
Speaker 1: right of first refusal meantity meant he could transfer the

212
00:13:45,520 --> 00:13:49,200
Speaker 1: right to a subsidiary of his. About that, if it

213
00:13:49,240 --> 00:13:53,200
Speaker 1: became not a subsidiary of mind, it says them, the

214
00:13:53,360 --> 00:13:59,920
Speaker 1: right terminated. So is this entity uh associdiary of his?

215
00:14:01,240 --> 00:14:03,920
Speaker 1: I can tell you an easier case would have been

216
00:14:04,440 --> 00:14:09,400
Speaker 1: if somewhere along the line Kaiser transferred for a hundred

217
00:14:09,480 --> 00:14:13,440
Speaker 1: thousand dollars, Let's say this right of first refusal to

218
00:14:13,520 --> 00:14:18,960
Speaker 1: his cousin Vinnie, and then it's clear now the the

219
00:14:19,280 --> 00:14:22,160
Speaker 1: rights have been transferred to someone who's not Kaiser, and

220
00:14:22,200 --> 00:14:25,320
Speaker 1: it's not a subsidiary of Kaiser. So that'd be an

221
00:14:25,320 --> 00:14:28,000
Speaker 1: easy case. That's not what he did. What he did

222
00:14:28,120 --> 00:14:33,720
Speaker 1: was he apparently created a corporate entity. I presume he

223
00:14:34,160 --> 00:14:40,080
Speaker 1: himself Mr. Kaiser was the controlling shareholder, and in that sense,

224
00:14:40,120 --> 00:14:44,200
Speaker 1: he viewed that entity as a subsidiary is and I

225
00:14:44,520 --> 00:14:48,600
Speaker 1: don't know, uh, who has been holding this or what

226
00:14:48,760 --> 00:14:53,120
Speaker 1: has happened after he passed away, but I will say

227
00:14:53,160 --> 00:14:59,120
Speaker 1: that in general contractual rights corporate shares, if I'm holding

228
00:14:59,160 --> 00:15:01,120
Speaker 1: one shares as AV A T and T and I

229
00:15:01,160 --> 00:15:06,640
Speaker 1: pass away, those shares don't disappear. They go to my heirs. Similarly,

230
00:15:06,680 --> 00:15:09,400
Speaker 1: if I have an option contract on a T and

231
00:15:09,480 --> 00:15:12,360
Speaker 1: T shares and I pass away, that option contract would

232
00:15:12,360 --> 00:15:14,280
Speaker 1: would go to my heirs and they would be able

233
00:15:14,320 --> 00:15:17,480
Speaker 1: to execute. In this case, it's complicated by the by

234
00:15:17,520 --> 00:15:21,560
Speaker 1: the precise language of the contract though, with the use

235
00:15:21,600 --> 00:15:28,400
Speaker 1: of this subsidiary of a person. Usually subsidiaries are corporations

236
00:15:28,440 --> 00:15:31,440
Speaker 1: owned by other corporations. That's how I would normally understand it.

237
00:15:31,840 --> 00:15:35,320
Speaker 1: A subsidiary of a person is an odd concept that

238
00:15:35,800 --> 00:15:37,840
Speaker 1: the court is going to have to think carefully of.

239
00:15:37,880 --> 00:15:40,680
Speaker 1: That Well, I guess that's my next question. I know, what,

240
00:15:41,120 --> 00:15:45,320
Speaker 1: how does case law clarify this this sort of cloudy

241
00:15:45,400 --> 00:15:50,640
Speaker 1: legal situation. I don't know the precise answer, and I

242
00:15:50,680 --> 00:15:57,400
Speaker 1: would say that there's probably not precise case law on

243
00:15:58,000 --> 00:16:03,040
Speaker 1: a situation exact like this, at least in Colorado and

244
00:16:03,080 --> 00:16:08,360
Speaker 1: this is a case before Colorado Court that said the

245
00:16:08,440 --> 00:16:11,480
Speaker 1: court could look to decisions made by other states, most

246
00:16:11,480 --> 00:16:16,600
Speaker 1: notably probably Delaware, which is a lot of corporate litigation too,

247
00:16:17,360 --> 00:16:21,880
Speaker 1: to try to um get some education on how others

248
00:16:21,920 --> 00:16:25,000
Speaker 1: have dealt with it in the past. One way or another.

249
00:16:25,320 --> 00:16:28,720
Speaker 1: This issue has to be clarified before the Broncos can

250
00:16:28,800 --> 00:16:32,960
Speaker 1: be sold. That would be your understanding, correct. I think

251
00:16:33,000 --> 00:16:37,200
Speaker 1: it was a wise decision by the current owners to

252
00:16:37,240 --> 00:16:42,000
Speaker 1: go ahead and file this lawsuit, which is against r

253
00:16:42,040 --> 00:16:44,960
Speaker 1: O f R Holdings, to try to get a clear

254
00:16:45,040 --> 00:16:48,760
Speaker 1: answer on this before they went ahead. So I take

255
00:16:48,800 --> 00:16:54,920
Speaker 1: it that they view it as imperative to clarify whether

256
00:16:55,080 --> 00:16:58,480
Speaker 1: or not this right at first refusal is validly held

257
00:16:58,920 --> 00:17:03,080
Speaker 1: by R O f ARE Holding. Andrew Schwartz, Professor of Law,

258
00:17:03,360 --> 00:17:06,639
Speaker 1: University of Colorado, appreciate taking time and joining us on

259
00:17:06,760 --> 00:17:10,639
Speaker 1: Bloomberg Law. Thank you very much. Good day. That's it

260
00:17:10,720 --> 00:17:13,159
Speaker 1: for this edition of the Bloomberg Law Show. Remember you

261
00:17:13,200 --> 00:17:16,040
Speaker 1: can always get the latest legal news on our Bloomberg

262
00:17:16,160 --> 00:17:20,040
Speaker 1: Law podcast. You can find them on Apple podcast, Spotify,

263
00:17:20,640 --> 00:17:26,359
Speaker 1: and on www dot Bloomberg dot com, slash podcast Slash Law,

264
00:17:26,520 --> 00:17:29,359
Speaker 1: and remember to tune into the Bloomberg Law Show every

265
00:17:29,440 --> 00:17:31,920
Speaker 1: night at ten pm Wall Street Time. The show is

266
00:17:31,960 --> 00:17:35,240
Speaker 1: produced by Eric Mallow for Bloomberg Radio. I'm Joe Shortsley.

267
00:17:35,400 --> 00:17:37,399
Speaker 1: Thank you for listening, and remember to tune into the

268
00:17:37,400 --> 00:17:44,080
Speaker 1: next edition of Bloomberg Law right here on Bloomberg Radio.