USL Soccer Team Led by Landon Donovan Folds; Financial Ties to Pawtucket Owner Johnson & Fortuitous
GoLocalProv Business Team
USL Soccer Team Led by Landon Donovan Folds; Financial Ties to Pawtucket Owner Johnson & Fortuitous
The San Diego Loyal, coached by former U.S. star Landon Donovan, will cease operations after its fourth season in the United Soccer League’s second-tier League Championship later this summer.
San Diego chairman Andrew Vassiliadis made the announcement.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTThe San Diego team's co-founder and present president Warren Smith and Johnson had a legal battle in recent years.
Efforts to contact Vassiliadis earlier this week before the team announced it was folding were unsuccessful.
The failure of the San Diego team raises more questions about the financial viability of this level of minor-league soccer. Another team that Johnson was involved in and abandoned his ownership has dropped its professional standing and is now just an amateur team. Johnson took a controlling interest in the FC Tucson team 2021 and relinquished his ownership last summer and then the team then left the professional ranks.
No Litigation
The agreement between Fortuitous and San Diego Loyal was struck just a few months after Fortuitous and Johnson submitted their application to Rhode Island officials for the "PROPOSAL FOR USING, REDEVELOPING AND OPERATING MCCOY STADIUM AND PAWTUCKET DOWNTOWN DEVELOPMENT."
That application was filed in April of 2020 with the Rhode Island Commerce Corporation.
In that submission to state officials, Johnson and Fortuitous represented in the litigation statement, “Fortuitous has never been party to any litigation, arbitration or mediation.”
But just weeks after Johnson Fortuitous submitted documents to Rhode Island, the owner and club filed a settlement agreement with the San Diego soccer team filed in San Diego courts. This came almost days after a "term sheet" was signed.
The settlement states: “This Release and Settlement Agreement ("Agreement') is entered into this 18th day of September 2019, by and between USL San Diego, LLC, a Delaware limited liability company ("USLSD") and Fortuitous Partners, LLC, a Delaware limited liability company ("Fortuitous"). USLSD and Fortuitous shall be collectively referred to herein as the "Parties/ in reference to the following: “
The Parties previously entered into that certain Fortuitous Partners - USL San Diego Term Sheet, effective July 20, 2019, as supplemented by that certain Consent of Fortuitous Partners executed by Fortuitous on·or about August 9, 2019 (as supplemented, the "Term Sheet") setting forth the Parties' intent to explore creation of a joint venture for ownership of a United Soccer League franchise ("Franchise").
The Term Sheet contains a· provision relating to a so-called "Fortuitous Exclusivity Period," which the Parties intend by this Agreement to terminate.
Disagreements have arise between the Parties [sic] arising out of the nature and extent of the Parties' obligations, if any, under the Term Sheet.
Subject to the provisions below, this Agreement is intended to settle and resolve any and all disputes, disagreements, claims and demands in any way relating to or arising out of the Term Sheet, and any and· all other claims, whether known or unknown, which either of the Parties might have against the other.
There is no indication that Fortuitous and Johnson notified Rhode Island officials about the dispute.
The agreement establishes a series of payments by the San Diego team to Johnson and Fortuitous to remove them from the ownership and the market.
Payments to Remove Johnson and Fortuitious
According to the agreement, the San Diego club would make a series of payments to Johnson and Fortuitious to separate.
See additional coverage of the proposed minor league soccer stadium below.