According to the Department of Justice, Leiweke allegedly told colleagues back in 2017 he wanted to figure out a way to get OVG’s competitor to “back down” in bidding for the arena project. In February 2018, Leiweke allegedly struck a deal in which the competitor CEO at Legends Hospitality agreed to stand down on bidding for the project. In exchange, Leiweke allegedly told the Legends CEO, unnamed by the DOJ, that OVG would give them some of the business through subcontracts. That left OVG as the only bidder for the development contract.
Officials called the alleged deal “bid rigging” and said it allowed the company to land a highly lucrative contract without an arm’s-length competitive process. The arena opened in 2022, and authorities said OVG continues to receive “significant revenues” from the project to date. OVG has agreed to pay $15 million in penalties while Legends Hospitality will pay $1.5 million, both “in connection with the conduct alleged in the indictment against Leiweke,” DOJ announced.
“Timothy Leiweke allegedly led a scheme designed to steer the contract for entertainment services at a public university’s arena to his company. Public contracts are subject to laws requiring an open and competitive bid process to ensure a level playing field,” said assistant director in charge of the FBI’s New York field office Christopher G. Raia in a statement. “The FBI is determined to ensure that those who disregard fair competition principles do not benefit from a rigged bidding process targeting our communities and public institutions.”
A spokesperson for Leiweke said the veteran exec had “done nothing wrong and will vigorously defend himself and his well-deserved reputation for fairness and integrity.”
“The Antitrust Division’s allegations are wrong on the law and the facts, and the case should never have been brought,” Leiweke’s spokesperson said. “The law is clear: vertical, complementary business partnerships, like the one contemplated between OVG and Legends, are legal. These allegations blatantly ignore established legal precedent and seek to criminalize common teaming efforts that are proven to enhance competition and benefit the public.”
“[T]he last thing I want to do is distract from the accomplishments of the team or draw focus away from executing for our partners, so the Board and I decided that now is the right time to implement the succession plan that was already underway and transition out of the CEO role,” Leiweke said. “ In my new role as Vice Chairman of the Board and as an OVG shareholder, I remain as committed as ever to the long-term success of the company, and I know OVG, our valued partners and our customers are in great hands with Chris and the rest of our stellar leaders.”
“We support all efforts to ensure a fair and competitive environment in our industry and are committed to upholding industry-leading compliance and disclosure practices,” OVG’s stated.
Legends did not immediately respond to a request for comment.
