SMG Contests Oakland Deal

SMG has filed a complaint against the Joint Powers Authority that governs the publicly owned Oakland Coliseum complex that includes O.co Coliseum and Oracle Arena, protesting the board’s decision to open negotiations with AEG to run the venues.

Lawyers for SMG cited “substantial irregularities” including violations of California’s Brown Act – the “sunshine” law that mandates open meetings and transparency in the conduct of public agencies.

In a 10-page complaint released April 27, SMG alleges the JPA convened in a last-minute session and failed to include the deciding vote in its agenda. Commissioners voted 4-3, with one abstention, April 20 to begin negotiations with AEG to operate the stadium and arena, ending SMG’s 13-year run.

SMG also questioned the final vote rejecting SMG and Global Spectrum, which also submitted a bid to manage the complex. One commissioner was apparently asked twice to cast her vote before ultimately throwing in her lot with AEG – appearing confused and prompted by another commissioner when she initially voted against the plan.

Commissioners said they kept the bids secret for as long as possible to prevent competitors from gaining an informational advantage, according to the Oakland Tribune.

However, the complaint alleges the JPA misrepresented information regarding qualifications of the bidders to operate the facilities, particularly the NFL stadium that is home to the Oakland Raiders.

According to the complaint, commissioner Scott Haggerty informed the board that AEG had operated the Los Angeles Coliseum when the Raiders were tenants there when, in fact, it was SMG. The complaint cited several other pro football stadiums managed by SMG and pointed that AEG has managed none.

The complaint also alleges the board was denied access to complete bid materials from all three companies until just days before their meeting to decide with which to negotiate.

Finally, the complaint claims the JPA failed to include a protest process in its request for proposals, and only after the vote did the City of Oakland’s bidding procedures apply – giving the losing bidder just five days to file such a protest.

“In short, this is a public decision that cries out desperately to be done right and that, fortunately, can be easily and timely corrected,” SMG says in the complaint.

SMG asks that the JPA correct the alleged violations and reopen the question “in an open and transparent manner or rebid the management contract.”