Originally created 03/10/99

Penguins ex-owner might owe $45 million

PITTSBURGH -- A former owner of the Pittsburgh Penguins could owe the bankrupt team's banks $45 million, according to documents filed in bankruptcy court.

Lawyers for current Penguins co-owner Roger Marino said the documents indicate that former co-owner Morris Belzberg guaranteed loans that banks made to the team.

"I think it's a contract, and I think that the secured creditors are the beneficiaries of that contract," said Harry Manion III, one of Marino's lawyers.

"Belzberg guaranteed to pay the shortfall," Manion added.

Belzberg is one of the original partners of Penguins co-owner Howard Baldwin and retains a stake in the team. He is not on the hook for the $45 million, said his lawyer, Steven Engberg.

"This was done for tax purposes," Engberg said.

Engberg said the only way Belzberg would be liable to repay the $45 million is if the Penguins were sold and the price fell short of the amount needed to pay off the loans.

The Penguins owe banks and insurance companies about $70 million, but the team is worth about $94 million, Engberg said.

Marino also has demanded that all partners invest an additional $600,000 or lose their investment in the team. Marino's order gives Belzberg until Friday to make the additional investment.

Engberg said the bankruptcy filed last October puts a hold on such a demand.

"They didn't have the right to do that," Engberg said.


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