EVANDER KANE: HOW TO EXPLAIN HIS GAMBLING DEBT AND OTHER PROBLEMS BANKRUPTCY TO HIS BOSS

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I wish to thank our friend, US Bankruptcy Attorney Neil Ackerman of Pryor & Mandelup, L.L.P of Westbury NY, for pulling the bankruptcy filing for me so quickly so that this Brandon Blog could be published on a timely basis.

Evander Kane filing for bankruptcy introduction

On January 9, 2021, Evander Kane, an NHL hockey player forward with the San Jose Sharks, filed his voluntary bankruptcy petition for a Chapter 7 bankruptcy case in the United States Federal Bankruptcy Court for the Northern District of California. I understand that earning megabucks as a professional athlete and declaring bankruptcy seems astonishing to a lot of you, yet it’s real. There are many retired pro athletes who are broke. They have actually made a lot of money and then lost it. They have absolutely nothing to show for it. No protected investments, no retirement fund, nothing socked away with for a rainy day.

I discuss the Evander Kane bankruptcy filing and talk about other former pro athletes who also had financial problems.

San Jose Shark Evander Kane bankruptcy filing

Evander Kane‘s bankruptcy documents paint an interesting picture. The documents state that he has US$10,224,743.65 in assets and the 29-year-old’s Chapter 7 filing list liabilities of US$26,837,340.00.

The assets are:

Amongst the almost US$27.0 million of liabilities, the more interesting ones are:

1. Loan Shark Holdings, LLC-Secured loan to fund tax shelters-US$2.5M
2. Centennial Bank-Loan-creditor may assert a claim over wages-US8.36M
3. Newport Sports Management, Inc.-Agent fees-US$528,730
4. Rachel Kuechle- Litigation claim-Unknown
5. Sure Sports LLC- Claim for fees-US$1.28M
6. Zions Bancorporation-Loan-$4.25M
7. IRS- Income tax (subject to accepting tax shelter deductions)-US$256,320
8. Various individuals-Personal loans-US$2.15M

Shark Star player seven-year, $49-million contract, banks, gambling and other interesting information

Here is some interesting information coming from his bankruptcy filing:

• In the year prior to his filing Chapter 7 bankruptcy, he lost and paid off gambling debts, including losses on sports gambling of US$1.5 million.
• Evander Kane listed that he has a monthly cash shortfall of US$91,131.13 supporting himself, his parents, his 27-year-old sister, 1 daughter, 2 uncles and his grandmother. In making that calculation, he did not include any monthly income amounts from his annual salary that is set at US$3,000,000 for the year 2020/2021 under his personal services contract with San Jose. He did this because his salary will be prorated due to the shortened NHL’s 2020-21 season of 56 games. Also, there is uncertainty over the season due to COVID-19 concerns. It will certainly not be your typical season. His deal was originally a seven-year contract.
• The filing also stated that he might opt-out of the league regular season games “because of health concerns given the recent birth of his first child.” If he does so, he would certainly not be paid anything. The filing also stated there is a possibility that Evander Kane may not even play in the upcoming regular season, though he has actually gone to spend a period of time on ice in the Sharks training camp. Neither Evander Kane nor his representatives have actually said anything about his intentions for the current season.

• Arkansas-based Centennial Bank is suing both Evander Kane and the Sharks. They claim that they owe over US$8M, consisting of principal, interest and bank fees after both Kane and the team quit making payments in 2019.
  
  According to Centennial Bank’s claim, the Sharks were expected to make continual regular monthly payments to the financial institution by deducting funds from Kane’s salary until the full amount owing was totally paid back. In its claim, Centennial asserts that it was Evander Kane who had actually got the Sharks to stop payments on the loan. Centennial Bank certainly does not feel there has been sufficient financial redress.

• No doubt some of the US$1.5 million of gambling losses paid in the year prior to his bankruptcy went to the Cosmopolitan of Las Vegas. The Cosmopolitan, the two-tower resort and casino on the Strip, revealed in late 2019 it withdrew its $500,000 gambling loss litigation case for unpaid gambling debts against Sharks Star Evander Kane.
  
  A casino marker is a line of credit issued to a VIP customer to enable high-level gaming customers simple access to large amounts of cash. Markers are available after the casino’s credit department has checked out the financial worthiness of the customer beforehand and then if approved, sets the line of credit. Fundamentally, gambling markers are interest-free temporary financings that have to be quickly paid off, or else the borrower faces high rates of interest and possible criminal charges.
  
  The Cosmopolitan’s claim stated that Evander Kane, a Canadian, allegedly took out 8 markers of differing amounts ranging from $20,000 to $100,000. This was on or about April 15, 2019, a day between Games 3 and 4 of the Stanley Cup first-round playoff between the Vegas Golden Knights and the San Jose Sharks. In addition to the overdue credits, Cosmopolitan looked for repayment of legal costs connected with the claim.
  
  Cosmopolitan’s attorney, Lawrence Semenza, confirmed that the case against San Jose Shark’s left-winger has been withdrawn and that Kane cannot be sued for this debt again. No doubt money changed hands but Mr. Semenza would not confirm that.
• Kuechle v. Kane: On a much more serious note, Evander Kane listed this civil litigation in the Erie County Supreme Court in Buffalo, NY as pending. In her claim, filed on July 1, 2016, this then 21-year-old woman named Rachel Kuechle, declares that on December 26, 2015, she met Kane at the Encore Restaurant in Buffalo. She claims that he provided her with alcoholic beverages and invited her to his hotel room at the Buffalo Marriott Harborcenter on the early morning of December 27, 2015.
  

Kuechle further claims that upon arriving at the hotel that morning, Kane allegedly battered this woman creating her to experience physical injury consisting of lacerations, considerable hemorrhaging needing several surgical treatments as well as blood transfusions, along with severe emotional trauma. As the case is still pending, these claims have not yet been adjudicated. At the time, Evander Kane was playing for the Buffalo Sabres.

Is Chapter 7 bankruptcy in Canada?

Chapter 7 bankruptcy is not in Canada. It is part of the United States Bankruptcy Code, the bankruptcy law in the USA. However, there are many similarities between Chapter 7 bankruptcy and Canadian bankruptcy.

Chapter 7 is for individuals that have financial problems stopping them from paying their debts. It is also for people who are willing to enable their non-exempt assets to be used to pay their creditors.

The main purpose of declaring under Chapter 7 is to have your financial debts discharged. The bankruptcy discharge clears you after bankruptcy from needing to pay most, if not all of, your pre-bankruptcy financial debts.

Like in Canadian bankruptcy, there are certain debts that cannot be discharged as a result of a person’s discharge from bankruptcy. Also, properly secured debts, like a mortgage on property or a vehicle financing loan, can still be enforced after discharge.

Gambling debt forgiveness is possible both in Chapter 7 and Canadian bankruptcy cases. However, it is not straightforward like many other unsecured debts are.

Also, if the court finds that you have committed particular kinds of improper conduct described in the Bankruptcy Code, the court might reject your discharge. The same is true in Canada.

I have written many blogs about Canadian bankruptcy. My most recent one is from a few days ago: DECLARING BANKRUPTCY IN CANADA: NEVER WORRY WHAT TO DO AGAIN WITH THESE AWESOME TIPS.

Former pro athletes who are broke: Evander Kane has some company

They awaken one morning and the cash is all gone, the charge cards have been cancelled, the bank has confiscated the estates and the fleet of luxury automobiles. The most awful part is that a lot of them don’t even understand where the cash went.

It has been reported that so far, Evander Kane has earned $52.9 million over his 11-year career. In his bankruptcy filing, Kane stated that in each of the last 3 years he earned:

Another Evander. It’s easy to blow a lot of money. Evander Holyfield invested/spent $230 million in no time. He bought a 235-acre Utah estate with 109 rooms. The monthly electricity bill was $17,000. There was likewise a $550,000 loan he got to pay for landscape design; $200,000 in IRS tax obligations, plus alimony and also child support for three ex-wives as well as 11 children.

It likewise adds up quickly when you’re spending like a drunken seafarer. Boris Becker is a recent bankruptcy filer of the many sports celebrities to declare bankruptcy in spite of huge earnings. The marriages, sweethearts, children and an unsupportable way of life ultimately overtook Boom Boom.

Canadian olympian Donovan Bailey was another athlete that had income tax troubles. To lessen the amount of personal income tax to be paid, he made a “philanthropic” contribution. The money made its way back to Mr. Bailey, through an overseas account. It was intended to come back tax-free.

The trouble was that Canada Revenue Agency (CRA) reassessed Donovan Bailey. They claimed the charitable donation was no more than a sham to prevent paying taxes. Instead of tax-free cash Donovan Bailey found himself in debt to the CRA to the tune of $2.3 million in overdue tax obligations and ended up in bankruptcy court.

Former pro athletes who are broke: According to Charles Barkley

​Charles Barkley believes that 60% to 70% of former pro athletes go broke and have no retirement savings. There are many reasons:

• Buying expensive presents and giving money to family and friends.
• Unsupportable lifestyles
• Mansions around the world
• Yachts
• Exotic and luxury vehicles
• Unprofitable business ventures
• Bad money management
• Not understanding financial matters

The result is lots of debt, zero savings.

Evander Kane summary

Not many of us will ever make the kind of money Evander Kane has, and still can. It is important to know the basics of money management and have some elementary level of financial literacy.

I hope you enjoyed this Evander Kane Brandon Blog post. If you are concerned because you or your business are dealing with substantial debt challenges and you assume bankruptcy is your only option, call me. It is not your fault that you remain in this way. You have actually been only shown the old ways to try to deal with financial issues. These old ways do not work anymore.

The Ira Smith Team utilizes new modern-day ways to get you out of your debt difficulties while avoiding bankruptcy. We can get you the relief you need and so deserve.

The tension put upon you is big. We know your discomfort factors. We will check out your entire situation and design a new approach that is as unique as you and your problems; financial and emotional. We will take the weight off of your shoulders and blow away the dark cloud hanging over you. We will design a debt settlement strategy for you. We know that we can help you now.

We understand that people and businesses facing financial issues need a realistic lifeline. There is no “one solution fits all” method with the Ira Smith Team. Not everyone has to file bankruptcy in Canada. The majority of our clients never do. We help many people and companies stay clear of bankruptcy.

That is why we can establish a new restructuring procedure for paying down debt that will be built just for you. It will be as one-of-a-kind as the economic issues and discomfort you are encountering. If any one of this seems familiar to you and you are serious about getting the solution you need, contact the Ira Smith Trustee & Receiver Inc. group today.

Call us now for a no-cost consultation.

We will get you or your business back up driving to healthy and balanced trouble-free operations and get rid of the discomfort factors in your life, Starting Over, Starting Now.

We hope that you and your family are safe, healthy and secure during this coronavirus pandemic.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.