What is Haslam’s Future with the Browns?

Jan 11, 2013; Berea, OH, USA; Cleveland Browns owner Jimmy Haslam III talks during a press conference at the team

August is drawing to a close and the regular season is right around the corner.  The Browns have experienced a lot of changes since the close of the 2012 season.  With the exit of Randy Lerner and Mike Holmgren, there has been a peak of hope that the direction of the Browns franchise could improve.  Jimmy Haslam III sold his minority interest in the Pittsburgh Steelers in order to purchase the Cleveland Browns one year ago, in August of 2012.  Since then he has revamped the coaching staff, front office, and brought in bigger free agent names than the Browns have been able to draw in recent history.  Most signs seem to be pointed in the right direction.  An issue that continues to be a concern for fans is the legal proceedings involving Pilot Flying J, and the allegations that Haslam was involved in the defrauding of shipping companies gas rebates.

Focus on the Pilot Flying J case and on Jimmy Haslam has brought concern about another Browns franchise sale.  No one wants another new owner.  Another new front office.  Another new plan to right the football ship.  Unfortunately, the issue of Haslam’s involvement in the Pilot J scandal has been unresolved.  Atlantic Coast Truckers lawyer and representative Mark Tate has scheduled depositions for a number of Pilot Flying J top brass, including Jimmy Haslam, earlier this month.  Haslam’s legal team responded with a motion in Knox County Circuit Court to stop the deposition.  This motion must be heard in court, and a date has been set for August 30th.  In the meantime, Pilot Flying J has been attempting to settle its lawsuits out of court.  On August 19th, The Plain Dealers John Caniglia reported that a lawyer for Jimmy Haslam’s family business has issued a 38 page settlement offer of $40 million in principle payments to trucking companies, and an additional $14 million for attorney fees.  Argument continues on the fairness of the Haslam family settlement offer, and the case drags on.

Jimmy Haslam has stated on numerous occasions that he will “absolutely not” sell the Browns.  This seems to be Jimmy’s baby, his project which he wants to turn around.  In a  news conference on July 25th in Berea, Haslam apologized for the negative press that the Browns have gotten over the Pilot Flying J issue.  He went on to claim that his two major concerns for now remain the conclusion of the Pilot legal issues, and following through with the improvements to the Browns franchise.  Haslam claims that his legal problems have not been a distraction for the Browns front office, or the player roster.  When asked during the press conference if the Pilot Flying J legal issues would lead to a cash flow problem, Haslam pointed to his spending after the purchase of the Browns.  Haslam has opened his check book this year, renovating the facilities in Berea both inside and out.  This, along with free-agency signings and planned renovations for the stadium do indicate that Jimmy Haslam isn’t hurting for cash, and more importantly, is willing to spend those needed dollars on improving the fans experience at Browns games.  This was a major criticism of Randy Lerner, and if the spending continues and translates into wins on the playing field, fans are likely to forgive the bad press that started Jimmy Haslams tenure in Cleveland.

In the same press conference, to start training camp, Jimmy emphasized that he views the Browns as a “long-term project”, but needs to see improvements to the team as this season progresses.  He has made a point of stepping back and giving Head Coach Chudzinski and Chief Executive Officer Joe Banner the reigns in managing the Browns.  When asked if Jimmy Haslam had any plans to address the players during training camp, he responded, “No.  That’s Chud’s job.”  As the preseason draws to a close, Haslam has remained in the background and seems to be content with his management handling all operations.

In closing the press conference, Haslam proclaimed his transparency in dealing with NFL Commissioner Goodell, and that he has been honest and open with Browns fans.  After meeting with Haslam, Roger Goodell told The Plain Dealer that, “Jimmy Haslam is a man of great integrity.”  Goodell continued by saying, “We’re proud to have him as an owner in the NFL and think he’s going to be a great owner for the Cleveland Browns and their fans here. He’s as disappointed as anybody in what happened at Pilot [Flying] J and he’s working hard to fix it and correct those issues, both from a structural standpoint and to make amends. He’s kept me very much involved. I think… as he tells me I was one of his first calls to inform me what was happening after he learned about it and he’s been great at keeping us informed.”  In other words, it looks like the NFL has publicly endorsed Jimmy Haslam as an owner.  It makes sense that the NFL does not want to contribute to the controversy surrounding one of its owners.

"The folks that can afford to come up with this type of money often push pedal to the metal in their business dealings. That doesn’t make them bad guys. But it does make them more likely to be probed, looked into and perhaps, ultimately, investigated by the law.  – Mike Ozanian of Forbes Magazine"

There are other aspects of Haslam’s ownership that could be of concern.  In February of 2012 Pilot Flying J purchased Western Petroleum.  In August of 2012, they purchased Maxum Petroleum.  “They are the No. 1 supplier to the drilling and fracking operations in the country,” Haslam proclaimed.  The Plain Dealer reported that these companies have provided services to Ohio drilling rigs, and Haslam hopes to expand those fracking operations.  Hydraulic fracturing’s environmental impact, as well as its implications for the residents of Ohio are controversial.  The focus here isn’t to pick a side of that argument, but rather to point out that Jimmy Haslam has invested a lot of time and money in Ohio’s natural gas industry.  As he was also purchasing the Browns during the Pilot Flying J’s purchases of petroleum companies, with the idea of expanding the fracking industry in Ohio, what are we to make of Jimmy Haslams motives?

Looking over the evidence, a certain number of conclusions can be reasonably assumed.  On one side of the coin, Jimmy Haslam appears to genuinely be interested in seeing the Browns franchise prosper.  He has invested a lot of money into the franchise and the energy industry in Ohio with the idea of turning a profit in the long-term.  This indicates that Jimmy Haslam has no intention of stepping down as owner, or selling the team.  While Haslam did not break the bank on payroll this year, he has shown a willingness to give Joe Banner the means to add talent to this team. With flexible cap space and extra draft picks in 2014, the Browns have the ability to drastically improve their talent into next season.  

Mike Ozanian of Forbes Magazine illustrates the other side of the coin.  “The average NFL team is now worth north of $1 billion. You’d have to come up with more than $600 million to buy a mid-level baseball team nowadays.  The folks that can afford to come up with this type of money often push pedal to the metal in their business dealings. That doesn’t make them bad guys. But it does make them more likely to be probed, looked into and perhaps, ultimately, investigated by the law. Which means as the values of teams continue to go up, the vetting process of prospective team buyers will become more challenging for league commissioners like Roger Goodell and Bud Selig.”  All signs point to Jimmy Haslam’s continued ownership of the Browns, not only this year, but into the future.  While the prospect of a stable ownership is positive, Jimmy Haslam’s business dealings have had a negative impact on the Browns franchise.  Haslam has apologized, but it will be his future actions that tell fans what kind of owner he will be.