The lawsuit does not name Snyder or the NFL as defendants.
It alleges Bank of America and other defendants — including Merrill Lynch, Pierce, Fenner & Smith Inc. — “violated federal and state law and conspired with and aided and abetted various individuals and entities in a manner that resulted in serious and substantial financial harm” to Rothman.
The lawsuit says that because “Snyder had a reliable and complicit financial relationship with Defendants and because Defendants chose to put their collective financial interests above the interests of Rothman, the Defendants and Snyder were able to conduct business in an illegal and improper manner to the financial detriment of Rothman.”
Bill Halldin, a spokesman for Bank of America, said, “We will vigorously defend ourselves against these allegations.”
The NFL declined to comment.
In March 2021, the NFL finance committee approved a debt waiver that enabled Snyder to buy out his three limited partners. That agreement resolved a contentious dispute that had produced a grievance and an NFL arbitration procedure and had spilled into courtrooms. The waiver was ratified by a vote of all the NFL’s team owners and enabled Snyder to take on an additional $450 million in debt.
Snyder paid approximately $875 million to purchase the shares held by Rothman, Dwight Schar and Fred Smith, who owned about 40 percent of the team.
The Washington Post reported in November 2020 that a group of investors from California had offered $900 million for the shares. The potential buyers were Behdad Eghbali and José Feliciano — the billionaire co-founders of Clearlake Capital, a private equity firm — and Feliciano’s wife, Kwanza Jones, a singer, songwriter and philanthropist who grew up in the Washington area.
Snyder initially attempted to exercise a right of first refusal to match the offers made to Smith and Rothman but not the offer made to Schar. That led to a dispute over whether Snyder could exercise that right in such a selective manner.
In November 2022, Snyder and his wife, Tanya, the team’s co-CEO, announced they had hired BofA Securities, a division of Bank of America, to consider the possible sale of part or all of the team.
An investment group led by Josh Harris reached an unsigned, nonexclusive agreement with Snyder in April to buy the Commanders for $6.05 billion. Harris and Snyder signed an exclusive deal May 12. After Harris addressed initial concerns the NFL finance committee raised about the deal, the committee recommended approval in July. The owners voted unanimously July 20 to ratify the sale. It was a record sale price for an NFL franchise.
Snyder paid $60 million to the league as part of the closing of the sale, the NFL said that day as it announced the findings of an investigation conducted by attorney Mary Jo White. Her probe concluded that the Commanders had withheld revenue they should have shared with other franchises and that Snyder had sexually harassed a former team employee.
The lawsuit filed Wednesday says Rothman became a client of Bank of America’s “Wealth Management and Family Office Practice” in the early 1990s. Through its advisory relationship with Rothman, the lawsuit says, Bank of America became aware that he “could have an interest in investing in a professional sports franchise.” A bank representative approached Rothman in 2003 about a possible investment in Washington’s team and arranged for Rothman to meet with Snyder. Rothman purchased 10 percent of the team for $75 million, according to the lawsuit.
Rothman later purchased more shares to increase his stake to 15.2 percent, the lawsuit says.
The suit says that in December 2019 and early 2020, Rothman, Schar and Smith “were provided with financial information and statements from the Franchise which suggested that Snyder was: (i) improperly taking corporate action without required board approval, (ii) mismanaging Franchise assets, and (iii) self-dealing.” An example of such improper activity occurred, the lawsuit says, “when Snyder caused the Franchise to obtain a $55 million loan from Defendants … notwithstanding the fact that Defendants and other named and unnamed coconspirators knew or should have known at the time that the Franchise Board of Directors had not approved the 2018 Loan.”
In November 2018, according to the lawsuit, Bank of America “agreed with Snyder and the Franchise to act as the sole administrative agent for the 2018 Loan and [Merrill Lynch, Pierce, Fenner & Smith Inc.] agreed to act as sole lead arranger and sole bookrunner for the 2018 Loan.”
The lawsuit says that after the limited partners filed a 2020 lawsuit, Snyder “privately and publicly commented that nobody can ‘f–k with me’ ” and “insinuated that he would use the ‘dirt’ that he had accumulated on individuals including, but not limited to, NFL owners, the NFL Commissioner and other business people associated with the NFL.”
The lawsuit alleges that the November 2022 announcement of “Snyder’s intention to market and sell the Franchise with Bank of America/BofA Securities as the lead investment bank exposed the concerted efforts between Defendants, Snyder, and other named and unnamed co-conspirators to obtain all of the minority shares at a discounted price prior to publishing such announcement.”
Snyder’s sale to Harris’s group “was the culmination of Defendants’ and Snyder’s conspiratorial conduct,” the lawsuit says.