Slim and None

by Howard Baldwin

  Each work stoppage made for a far better working environment for ownership and, as far as I am concerned, for the players as well. Without the type of structure that came out of the stoppages, we would have had a league of 12 to 16 teams. The players on those teams may have been richer, but there would have been a lot fewer of them. The NHL is only as strong as its weakest link. Of course Toronto, New York, Montreal and other traditionally robust franchises do well, but the Nashvilles, Carolinas and St. Louises of the league need the opportunity to succeed in markets that are considerably smaller. Under Gary Bettman’s leadership, a CBA has evolved that allows both players and owners alike to grow as the sport grows.

  Sudden Death

  During the 1994–95 lockout we were also filming a movie called Sudden Death. The lockout made the shooting more difficult, as we were counting on actual sold-out games to film crowd scenes, and there weren’t any.

  Karen wrote the treatment for the film, and Gene Quintano wrote the screenplay, which was about a terrorist group that planned to blow up the Civic Arena just as the seventh game of the Stanley Cup final between the Penguins and the Chicago Blackhawks ended. Jean-Claude Van Damme was the star and the director was Peter Hyams, who had done The Star Chamber, 2010 and Timecop.

  In the script, the opposing team was Chicago, so we were planning on filming the game from every possible angle when they came to town. Of course, that plan went out the window after the games were cancelled.

  Fortunately, I had a pretty good relationship with Bob Goodenow, the head of the players’ association, and I asked him to let me have the Cleveland Lumberjacks, our farm team, play an exhibition game in Pittsburgh dressed as the Blackhawks, as our guys on the Penguins had agreed to help us out and play. Bob agreed to this, too, and we wound up with close to a sellout crowd.

  What we hoped to do with Sudden Death was create a movie that was very commercial and would draw people to hockey. And we wanted to tie our Penguins merchandise to the movie, to drive sales.

  The movie itself is essentially Die Hard in an arena. It opens with Karen as the director in the ESPN truck, and from there all the action of the movie is tied to the ticking clock in the arena. We cut from scenes around the arena, to things going on outside, to action on the ice, with the scoreboard joining everything together as it dramatically winds down to 0:00, when the arena will blow up.

  Bill Wirtz loved the movies, so when he heard we were making Sudden Death he asked what it was about. I showed him the script, and then told him that he was in it! He said he would love to play himself. Bill then realized that it would be a three-week commitment for him on the set, and that ended that. We had to use a real actor.

  Sudden Death was a modest success. It made about $75 million worldwide. It was, in its way, a testament to the old Civic Arena: the inspiration for the film was the fact that the roof of the arena could actually be opened up, although the hydraulics never were consistently reliable. When it was built in 1961, six years before NHL expansion, the Civic Arena was the first sports facility in the world with a retractable roof and was considered a major architectural feat at the time.

  The Russian Penguins

  By now, people in hockey recognized that I like doing things a little differently and am naturally attracted to situations a little off the beaten path. I think that’s what inspired Mike Barnett to present me with the most unique investment opportunity I’d ever seen in hockey.

  Much later, Barnett would become the general manager of the Phoenix Coyotes, but in the early 1990s he was running the hockey branch of the International Management Group, the largest sports management agency in the world. And he was the agent for Wayne Gretzky, among many other players. He had a lot of clout in the sport and was also a good friend.

  As we were coming to the end of our first year in Pittsburgh, Barnett came to me and asked, “Would you ever think about getting involved with the Red Army team?”

  The Iron Curtain had lifted less than four years earlier, and everything was changing dramatically in Russia. It was the Wild West, and some of the biggest institutions of the communist era were having trouble adjusting to life in the new world. One of those was the CSKA — the Central Sports Club of the Army, better known as the “Red Army.” The Red Army had always dominated Russian hockey, wearing the iconic red jersey with the letters CCCP, and had supplied most of the players for the USSR’s powerhouse international team.

  Mike was working with a fellow named Paul Theofanous who was fluent in Russian and really knew his way around the Iron Curtain countries. Theo was bright as hell and had an excellent knowledge of the inner workings of the Russian world. Mike and Paul were representing the Red Army, which had fallen on hard times in the Russian Elite Hockey League. You have to understand that Russia was just coming off communism, and while I wouldn’t say it was becoming a democracy, there was certainly a cultural revolution and the Red Army didn’t have the ability to do the things it used to do. For decades, if you were a great player in Russia and the Red Army wanted you, even if Spartak or any of the other teams wanted you too, the Red Army got you because they just enlisted you in the army with a one-time draft. So the Red Army got all the players they wanted. They had the crème de la crème of Soviet Hockey.

  Once that changed, it became a competitive environment, and they, of all teams, didn’t know how to compete. They had to buy players and didn’t have the money or know-how to compete for them because they had never had to — it was counterintuitive to communism. So they were looking for ways in which to create a business, and they came to us.

  We did the deal with Viktor Tikhonov, who was the Red Army coach, and Valery Gushchin, who was the general manager. Gushchin was a genuine character, and perhaps it’s a cliché, but he sure looked like he enjoyed his vodka. Tikhonov was stoic, didn’t smile much and was very serious about the game and how it had been traditionally played and presented. He had zero interest whatsoever in anything other than what was happening on the ice, and winning the game. He didn’t have a marketing bone in his body. He had been, by far, the most famous coach in the old USSR and had driven the Soviet national team to eight world championships and three Olympic gold medals. During the communist years, he had the rank of Red Army general and he controlled his team like a dictator, keeping his players isolated in training camp 10 or 11 months out of every year. He had to try to adapt to the new situation when players began to have freedom of movement, but it was a very difficult adjustment for him. He also had an extremely difficult time dealing with the multitude of promotions and marketing techniques that we brought to the situation.

  Tikhonov and Gushchin flew over to the U.S., and after meeting with them we got excited and decided to do the deal. We announced it in Pittsburgh, and it generated a lot of interest and speculation. Everyone was immediately suspicious of what we were up to.

  On our side the partners were Karen and me, our hockey partners Tom Ruta and Morris Belzberg from the Penguins’ ownership, our film partner Richard Cohen, the Canadian actor Michael J. Fox and Mario. It was a 50-50 deal between us and the Red Army, and I think we originally put 350 grand into the program. We had a legitimate Russian lawyer paper the deal, and their minister of defence signed the document.

  We were repeatedly asked why we were entering into such an agreement. We had four reasons.

  It had never been done before.

  We thought it would give us an edge on inside knowledge about potential Russian talent for the Pittsburgh Penguins.

  We thought it could be profitable because there was great interest in American products being sold in Russia, now that the Iron Curtain had been lifted.

  Any Russian player drafted off the Red Army team would generate a substantial transfer fee from the NHL to us.

  We hired Mark Kelley, Jack’s son, as our on-site GM. He was there to be our hockey eyes and ears and to find players for the Penguins. This was a time when NHL dra
ft choices were worth something to the teams they were chosen from. If you were drafted number one, your team got 250 grand and there was a declining order of payments after that. So we said to ourselves, “Hey, this is a) a way to make money and b) a way to get a little edge in the NHL.” This was the old Branch Rickey theory of operating a minor league team: find the best players, put them on your team with good coaching, and when they get selected by the NHL you end up with a high fee for your efforts. Then the NHL changed the rules.

  Any money changing hands between the league and an international federation would now have to go to the federation. Prior to this, if the Red Army had a player drafted in the first round, they were the direct recipients of $250K. For a second-round choice that number decreased but was still paid directly to the team. Under the new deal, the NHL just paid one flat fee to the IIHF (International Ice Hockey Federation), which was then shared equally amongst all the international federation teams. Therefore we lost the most valuable profit center for the Russian Penguins. That was the stupidest deal the federations ever made and they realized that . . . after the fact. It took away all the incentive for people to do a good job. Originally, club owners had been incentivized to develop as many number one draft choices as they could because that was their money, right there. Then that got taken away.

  We happened to introduce this Russian idea to Michael Eisner, the CEO of the Walt Disney Company, who had just acquired an NHL expansion team and called them the Mighty Ducks of Anaheim. The Disney folks wanted to get involved as a partner in the Russian deal too — Michael was really excited about it. They actually designed an amazing uniform for us and sent a young executive named Kevin Gilmore to join us on our Russian journey (Kevin is currently the chief operating officer of the Montreal Canadiens). The uniform created by Disney was fantastic but never used because we never could finalize the deal with them.

  Karen eventually designed a new logo and uniform in red, black and white. The red was the basic CSKA color, and the black and white came from the Pittsburgh uniform. The logo was a menacing-looking Penguin with a military cap and skates. When Tikhonov and Gushchin first saw the logo, they were hysterical with laughter. When we pressed them on what was so funny they admitted it looked like the general who had just been put in charge of all Red Army sport.

  We put in a young marketing whiz named Steve Warshaw to run things for us. If you were going to cast a movie, he’d be the Ben Stiller type. A shorter Ben Stiller. The idea was for Steve to show the Russians the culture of filling your building and doing all the cool things around an arena that we do over here — hockey, North American style.

  Candidly — and Steve would probably laugh at this — he had worn out his welcome at various other sports franchises. He lacked a bit of tact and he kept coming up with crazy ideas, but crazy ideas and someone who would not be deterred were just what the doctor ordered for this unusual situation. So we sent him to Moscow, where we thought he would be tolerated . . . or at least we wouldn’t have to hear about it. We figured the language barrier might work in our favor. It was a plus to not fully comprehend what Steve was saying. He was the proverbial “gum on a shoe” director of marketing. Sometimes he went too far. For instance, after a dinner in New York City with Michael Eisner and his wife, Jane, at the 21 Club that somehow Warshaw invited himself to, he sent Michael a follow-up e-mail which began “Dear Comrade Eisner.” I called Warshaw and said, “Stevie, Michael Eisner is head of one of the most important entertainment businesses in the world. He’s not your comrade, he’s ‘Mr. Eisner.’”

  It was a time of unrest over there. They wanted American money but they didn’t necessarily want Americans in their faces messing around with their way of doing things. Keep in mind that until our arrival on the scene, Tikhonov could have cared less what size of crowd they drew. Actually, they never had a crowd. They might have gotten 500 people on the best nights.

  It was hysterical to watch Steve and Tikhonov interact. With Tikhonov, it was all about the game on the ice, and winning. Period. With Steve it was all about cutting-edge promotions, and he could care less about the actual games themselves.

  For the first few games, nobody showed up except people who wanted to get out of the cold. Then, as Steve started doing more interesting and creative promotions, people started to take notice and they began buying tickets. Sponsors were sponsoring events once they saw the crowds starting to increase. It was starting to work. We had a Toilet Paper Night, a Razor Blade Night, a Toothpaste Night. People needed the basics and they came to the game for them. We drew a sellout crowd for a Free Beer Night promotion with Iron City Beer out of Pittsburgh, with cans featuring the Russian Penguins logo. Unfortunately we made one mistake: we gave out the free beer before the puck was dropped. Needless to say, as soon as the first goal was scored and there was a stoppage in play, 6,000 empty beer cans were thrown onto the ice. Watching Tikhonov’s reaction from the bench? Priceless.

  Then you had the cheerleaders. There had been no cheerleaders at Russian games before we arrived — in fact, there were no cheerleaders at U.S. games either. But Steve wanted to try something new. Near the arena complex in Moscow was a strip bar, and Stevie figured maybe the girls would want to make a little extra cash on the side, so he proposed that they come and cheer at the games. Remember, he spoke no Russian. So he hired some of them to entertain our crowds, and on the first night, the cheerleaders were going to perform their dance on the ice between the first and second periods. The crowd was excited and Steve was sitting in the stands feeling smug about his new “event.” The music began and the next thing you know our cheerleaders started shaking, and then began shedding their cheerleading outfits. Even over the sound of the music and the fans hooting and hollering, you could hear a primal scream from Warshaw in the stands as he shot out of his seat and raced onto the ice to pull the plug on the “inevitable” outcome. He was absolutely aghast and felt there needed to be a premium charged for that much entertainment! As a postscript, the next game was a sellout. The cheerleaders were retired, but they’d had the desired effect. Thank goodness Tikhonov was in the locker room at the time, or we would have had to resuscitate him.

  We chartered a private plane for our own personal visit around February of 1994. It was highly recommended that we bring security with us, as it could get dicey over there. Our security was provided by a friend of Theo’s named Billy McClain. All we had to do was look at Billy to know we were safe. Also on the trip were Tom Ruta, Ken Sawyer (the former NHL CFO who consulted with us), and Kevin Gilmore of the Mighty Ducks.

  It was dicey all right. There were people getting shot. Rich Americans were being kidnapped for ransom. We stayed in a beautiful hotel, but there were cement barriers all around it with guys carrying machine guns on patrol. When we went to Red Square, where all the markets were, there were all these American knock-offs, and Kevin Gilmore was taking pictures of it all. I asked him, “What the hell are you doing?” “Well, I gotta send these back to Disney, they’re illegal.” I said, “Kevin, you and what army are coming over here to tell the Russians they can’t sell merchandise featuring Mickey Mouski?”

  We had landed a major sponsor, American Motors. They wanted to promote the Jeep Wrangler in Moscow and were raffling one off through a lottery system that Warshaw ran all season. The game that we attended that February was the game when the winner of the Jeep was to be determined. The building was packed, and to Tikhonov’s utter dismay, the people were way more interested in who was going to win the Jeep than who was going to win the game. Remember, maybe one-tenth of the Russian population at the time even knew what a Jeep Wrangler looked like, and owning one was completely out of the question for almost all of them.

  The plan was that between the first and second periods there would be a selection process to go from 10 semi-finalists down to 2. It was just electric in the building, especially when they drove the Jeep out between the first and second periods. The place was going crazy.
Everybody was cheering and yelling as we got down to the two finalists: an older couple, and a young man about 19 or 20 years old. Each was given a key, one of which would start the Jeep, one of which was bogus.

  The young man had never driven a car, but with the help of the ice crew, he got the key into the ignition and cranked it. It started, the engine revved and there was pandemonium in the stands. In all the excitement, the young man shifted it into gear, the car started to spin around the ice and went right through the dasher boards. They patched up the boards with something or other, and Tikhonov was incensed, of course, absolutely beside himself with rage. But the kid got his Jeep. And Warshaw had outdone himself again.

  That night, Vadislav Tretiak, one of the world’s all-time great goalkeepers, hosted us for a delightfully memorable authentic Russian dinner, and we all had a good laugh over the Jeep.

  The next day we went to the rink, and Tikhonov and Gushchin told Tom and me that the general who had just been made sports minister of the Red Army, and who had just come back from the Afghan front, wanted to meet us. Apparently he wanted to express his appreciation for our investment in the Red Army team, and also wanted to see if we would come in on soccer and basketball and other sports under the Red Army umbrella. We said we would be delighted to meet and consider any rational proposal.

  Tikhonov and Gushchin said to me, “Now, Howard, do us a favour. If you are going to come in on soccer and basketball, it would make us look really good if you say that you want us involved.” I figured that would be fine. Theo was meant to be my interpreter, but he had evaporated for the afternoon, so we got an executive from the office instead. Our group — Tom, myself, Gushchin, Tikhonov, Steve Warshaw, and Billy McClain for security — were escorted over to the general’s offices and into a secure room with a massive conference table. There were a number of well-armed military personnel around. The head of the table was clearly reserved for the general, and I couldn’t help noticing Gushchin and Tikhonov at the farthest end of the table, looking very uncomfortable. I wondered, “What’s up here?”