Santa Clara city leaders Tuesday evening voted unanimously to terminate their agreement with the San Francisco 49ers for running non-NFL events at Levi's Stadium, including concerts, saying the team has "grossly mismanaged" those operations.
On Wednesday, the city announced it was taking legal action to prevent the team from booking any future concerts or other non-NFL events at the venue.
"If we get a new manager and we follow contracts. I think it’s very successful," Mayor Lisa Gillmor said Wednesday. "So, no, I don’t regret having a stadium here. We just have to have better managers."
The city says the bottom line is Levi's Stadium is not making any money. And city officials say the 49ers refuse to show records.
"So if they can provide that trust by providing those records to us, then maybe we have something to talk about," City Attorney Brian Doyle said.
During a closed session Tuesday evening, city leaders voted to take away the team's authority over all events except those related to the NFL. Such events include concerts, college football games, soccer matches and motocross events.
The council then announced the decision during its regular meeting.
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The issue, which isn't a new one, comes on the heels of a recent Rolling Stones show that came under scrutiny after the band said it would never play there again.
The city said in a statement the 49ers have grossly mismanaged stadium operations and violated state laws, including not paying some workers a prevailing wage.
"This failure includes, in part, booking non-NFL events that lose millions of dollars rather than money-making events such as weekend concerts, soccer games and corporate events," the city's statement said. "This mismanagement has resulted in non-compliance with Measure J."
The 49ers released a statement Tuesday, essentially pointing the finger at the city and City Manager Deanna Santana for mishandling operations.
"After City Manager Santana’s dysfunction with respect to stadium events was exposed, she has chosen to spiral even further. Her actions are purely retaliatory, and we are not surprised that she has commenced yet another legal battle. She is abdicating her fiduciary duty by destroying a city asset for petty, political vendettas."
On Wednesday, in response to the city's news conference, the 49ers responded with another statement:
"The 49ers Management Company will continue to manage Levi’s Stadium and attract the greatest events in the world to the Bay Area.
"The City’s latest announcement is just another step in a self-destructive process they began years ago as part of a petty political vendetta. All of those efforts failed, just as this latest attempt will also fail.
"The City’s legal case, such as it is, is in direct violation of the clear language of the relevant contracts. We are entirely confident that we will prevail in this dispute.
"The 49ers Management Company has attracted the world’s highest-profile events to the Bay Area, including Super Bowl 50, the College Football Playoff National Championship, the NHL Outdoor Stadium Series, Wrestlemania, Copa America, numerous concerts from the world’s biggest artists; more major events than any other new stadium in its first five years. These events brought hundreds of millions of dollars in positive economic impact to the region and increased Santa Clara’s sales tax and tourism base. As managers of Levi’s Stadium, the 49ers have generated over $22 million in profits to the SCSA, with $10.6 million going directly to the City’s general fund and an additional $9 million for the Stadium Authority’s Discretionary Fund. By all measures, it continues to be one of the most successful venues in sports and entertainment."
The city said in a statement Wednesday the issue likely will go to a confidential arbitration proceeding, although it would prefer to see it go to the public courts.
