Capital Sports, Trinity legal battle ends with out-of-court settlement

A lawsuit and counterclaim over a failed bid to redevelop LeBreton Flats and move the Ottawa Senators to a new downtown arena has been settled out of court, according to a statement from the team.

"All of the parties involved in this matter have reached an out-of-court settlement. [Capital Sports Management Inc.] will not be commenting further," said an email from an Ottawa Senators spokesperson sent to CBC on Monday night.

In November 2018, Capital Sports Management Inc. — which was wholly owned by late Senators owner Eugene Melnyk — sued Trinity Development Group Inc., its founder and executive chair John Ruddy, project manager Graham Bird, and his company, Graham Bird Associates, for $700 million. Melnyk died earlier this year.

The suit also named 801 Albert Street Inc. and other entities involved in the proposed construction of residential towers near the arena site.

According to the claim, "the joint venture failed because of an egregious conflict of interest on the part of Trinity and its principal, John Ruddy."

Trinity's countersuit

The following month, in December 2018, Trinity sued RendezVous LeBreton Group partners Melnyk and Capital Sports for more than $1 billion. Since Melnyk's death, the suit had been amended to name his executors and estate trustees.

In its countersuit, Trinity called Melnyk's claim "meritless" and alleged his true aim was to have Trinity or the City of Ottawa foot the estimated $500-million bill for the new arena.

Earlier Monday, CBC reported that Justice Ryan Bell on Thursday granted a motion by Capital Sports and dismissed the claims against Bird and his companies, as well as the companies involved in the Albert Street project, without cost.

Bell also ordered that nearly $2.5 million paid by Capital Sports be released and paid to its lawyers, Crawley MacKewn Brush LLP, in trust.

The case had been scheduled to proceed in January.