FanPost

Who actually runs the Bills anyway?

I posted a comment in the Russ Brandon leadership dumpster fire article, but thought I’d expand it into a fanpost for the edification of my fellow Rumblers. If you're wondering if Russ will resolve this apparent issue in a way that will make us fans happy, I'm afraid the likelihood is that you will be disappointed.

The question here is how is Russ Brandon going to deal with the reported friction within the organization between the so called Old Guard headed up by Littman and the New Guard of the football guys, Whaley and Marrone.

Here is the short answer – the New Guard have no cards to play except leaking this stuff about disagreements out into the press. These guys are relatively low on the totem poll and have no significant power outside of the practice facility and playing field. And even if Russ Brandon sympathizes with them, he’s likely got no power to do anything about it either.

Buffalo Bills, Inc. is a domestic New York corporation. The Bloomberg Business profile can be found here. You can look up the public information provided by the New York Secretary of State here. According to the NYS website, Ralph is still CEO, but that just means BBinc has not updated their filings. The organization chart is provided on the bufffalobills.com here.

First, a general explanation of corporate law.

There are generally three levels of decision making in a corporation. First, you have the shareholders, the actual owners of the company. Shareholders have one main power, and that is to elect a board of directors, the second level. The board of directors is generally responsible for determining the policies and direction of the company and making the big decisions – acquiring or divesting major assets, paying dividends, making major investments, organizing and reorganizing, etc., but they do not participate in the day to day business of the corporation. Instead, they implement their agenda by electing executives, the third level, to carry it out – individuals actually charged with the responsibility and authority to act on behalf of the corporation. Some common executive positions in a corporation are Chief Executive, Chief Financial Officer, President, VP, Secretary, Treasurer, etc. Individuals can and often do serve at all levels of organization, especially in a closely held corporation like BBinc.

One more thing – the corporation is run according to some operating document – sometimes the rules are included in the incorporating documents, but usually in the by-laws which is something like a constitution. This document determines shareholder voting rights, number of board members, executive positions, as well as a host of other important corporate governance matters.

Corporations can have a board of directors composed of one person. Notwithstanding, corporations with sole shareholders will often have more than one person on the board of directors, and the sole shareholder may not even be on the board. In any event, it’s a good idea to have more than one board member for one simple and practical reason – you don’t want the absence or incapacity of a single person to hamstring a corporation. Say the sole shareholder and sole board member dies suddenly – all of a sudden, there is no one available to make decisions until contingencies can be established through the estate administration/probate process. Alternatively, having 2 or more board members with an appropriate quorum and voting requirements will allow a corporation to continue functioning even in the absence of one person.

We know Ralph is the sole shareholder. The rest here is speculation on my part.

Even though Ralph is listed as President of BBinc., its more than likely that he does not have the legal capacity to make competent shareholder decisions, let alone carry out the responsibilities of a board member for a professional football team. Although I have no basis for saying this, I would not be surprised if Ralph has designated someone else to vote his shares on his behalf – if not actually pledged his ownership interest to a trust, in which case, the Bills are run by one or more trustees, not Ralph. In any event, whoever is voting the shares holds the real power.

All this leads to one question - who is on this board of directors? Maybe Ralph. Probably not at this point. I’m going to guess that Littman and Ralph’s daughter are on the board, along with maybe a few other people. Maybe even Brandon. But unless Brandon controls the board, there is no chance that the so-called Old Guard is going anywhere.

The executives have no say in all of this, and certainly, Whaley and Marrone are mere employees in the scheme of things.

So, if Whaley and Marrone are the ones who went to the press about this friction, this was the only card they have to play – and it’s a dangerous game because they are nobodies in the organization relatively speaking. The only thing they can hope for is overwhelming fan sentiment to give the new guard more power to acquire personnel and make deals, as well as run the team on the field.

Like I posted in the thread – the Buffalo Bills are probably a zombie corporation pretty much being operated as a estate, if not actually run as an estate, for an old man of diminished capacity. The fiduciaries, whoever they are, have only one responsibility, and that is to maintain the value of the organization until it is sold. Risks that might significantly improve the organization but may also damage its value are out of the question. The fiduciaries are probably operating with one eye on the eventual sale of the team.

And all this sucks for the fans.

This situation will continue until the Buffalo Bills NFL Franchise has a new owner who can own the risk of their decisions.

Just another great fan opinion shared on the pages of BuffaloRumblings.com.

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