Hurricanes owner a key figure in bankruptcy trial for defunct pro football league
It began with a genial press conference in February 2019, with Carolina Hurricanes owner Tom Dundon joining Charlie Ebersol in announcing Dundon would become chairman of the Alliance of American Football, a fledgling developmental league in its inaugural season.
Ebersol, a TV and film producer and co-founder of the league, talked of the “glow of Tom Dundon” in describing the league’s new investor.
“When Tom puts his focus into something and building something, he’s not building to build but building to win,” Ebersol said at the news conference in Raleigh.
That news conference would be the zenith of the relationship between Dundon, Ebersol and the AAF. The league quickly collapsed and subsequently filed for bankruptcy. Six years later, the legal battle over the league’s dissolution continues in federal bankruptcy court in San Antonio, Texas, and goes to trial on Monday.
In pre-trial court filings, the trustee representing debtors in the Chapter 7 bankruptcy, Randolph Osherow, alleges Dundon made a “definitive oral commitment” to invest $250 million into the league and then through operational decisions allowed it to go under financially. In the filings, the trustee alleges Dundon was seeking, in part, to offset his tax liability.
Dundon, a Dallas billionaire, invested $70 million in the league and later sued Ebersol, saying Ebersol misled him on the financial stability of the eight-team league that began play on Feb. 9, 2019.
Dundon shut down the AAF on April 2, 2019, and a Chapter 7 liquidation followed two weeks later.
Dundon said he agreed to a term sheet that would fund an initial $5.1 million and as much as $70 million in which Ebersol gave up 75% of Ebersol Sports Media Group, which owned the AAF.
In 2022, the debtors sued Dundon for about $180 million, the difference between the $70 million provided by Dundon and the $250 million that the bankruptcy trustee said was orally promised by Dundon.
U.S. Chief Bankruptcy Judge Craig Gargotta in March granted a motion for summary judgment to Ebersol in Dundon’s filing against him, saying that the term sheet was not a binding contract while citing issues over legal standing.
In the pre-trial filing, Dundon’s lawyers continue to argue he was misled: “Had DCP (Dundon Capital Partners) known about the delinquent debts, the faulty projections, the inability of Ebersol to deliver the 75% ownership in ESMG, and how the failure to secure financing had obliterated league revenue projections, DCP would not have entered the Term Sheet or invested in the league.”
Dundon and Ebersol, the son of long-time NBC executive Dick Ebersol, are on the debtors’ witness list, with the expectation of testifying at trial. The debtors also requested Mike Sundheim, vice president of communications for Hurricanes Holdings LLC, be deposed.
The witness-list filing said Ebersol is expected to testify he halted discussions with other potential investors after Dundon instructed him to announce the $250 million figure publicly and gave assurances of providing the full funding needed.
The Hurricanes put out a press release on Feb. 19, 2019, announcing Dundon had committed $250 million to the AAF and would serve as chairman of the board of directors. Don Waddell, then the team’s president and general manager, said in a statement that it was a “terrific opportunity for Tom to expand his investment in the sports world.”
The Dundon-Ebersol press conference was held later in the day at Lenovo Center, then known as PNC Arena. Ebersol, asked what made Dundon an attractive “partner” for the league, smiled and quipped, “Money made it very attractive. ... Our business model shifted entirely when Tom Dundon got involved and we’re very excited he joined on.”
Dundon later said he decided to invest in the league after seeing promising first-weekend TV ratings, and that he also received guidance from Dallas friends Tony Romo and Troy Aikman. During his press conference, there was talk of a possible AAF team playing in Raleigh in the near future.
The developmental league, co-founded by Ebersol and former NFL executive Bill Polian, was not affiliated with the NFL. Its goal was to groom talent for the NFL in the offseason while experimenting with new technology and rule changes in its 10-game season.
Dundon, contacted Sunday, declined to comment. His attorneys could not be reached.
Michael Saltz, an attorney representing Ebersol, said Sunday that Ebersol had other interested investors “lined up” but that Dundon wanted in, promised immediate funding for the league and insisted on being the sole investor in the AAF.
“Charlie is presented with ‘King Solomon’s choice,’ so he gives his ‘baby’ to Dundon so the baby can live, based upon the promise that he is going to invest in it and he is going to take control of it and that he’s not going to let it die,” Saltz said.
Saltz said the bankruptcy trial in San Antonio could last a couple of weeks.
This story was originally published April 13, 2025 at 12:52 PM.
