New court filings reveal potential threat to Mat Ishbia’s majority ownership of the Phoenix Suns due to alleged financial misconduct
A recent court filing in an ongoing lawsuit against Mat Ishbia has surfaced new financial details that could potentially jeopardize his majority ownership of the Phoenix Suns. The lawsuit, initiated on November 24 in Delaware State Court, has been brought forth by attorneys representing Scott Seldin and Andy Kohlberg, two minority owners of the Suns. A statement from Ishbia’s spokesman claimed that the latest filing, which contains allegations of financial misconduct, reveals “nothing new” and describes the claims as “ridiculous.”
The lawsuit accuses Ishbia of using the Suns as a “personal piggy bank” since his acquisition of the franchise in 2023. The conflict between Ishbia and the minority owners traces back to September 2024, when Kohlberg began negotiations for a buyout with an adviser associated with Ishbia. In contrast, Seldin chose not to pursue a buyout. Despite ongoing discussions, tensions escalated when Ishbia enacted a $250 million capital call raise on June 1, 2025, demanding the minority owners make payments by June 12 or face “punitive dilution” of their ownership interests. Notably, the valuation for new ownership units was set at $10 million each, contrasting sharply with the $198 million per unit valuation from three months earlier when Ishbia acquired units from previous minority owners.
Under protest, both Seldin and Kohlberg complied with the capital call. However, they contend that Ishbia set up another capital call on July 8, which they also paid into, despite their objections. Seeking further clarification, the minority owners requested internal financial records. They assert that the singular document provided indicated a “debt-to-equity conversion” that Ishbia allegedly used to fund part of his contribution. Ultimately, Seldin and Kohlberg claim that Ishbia failed to meet the funding requirements for either capital call, leaving them to fund approximately 38% of it, despite only holding 13% of the company.
Seldin and Kohlberg contend that the terms of the team’s operating agreement should have allowed them to purchase shares that Ishbia did not fund during the capital call. Their attorney pointed out that the ten-day notice for the capital call was strategically crafted to afford Ishbia an unfair advantage in increasing his stake while diluting the minority owners’ positions. The attorney asserts that Ishbia’s failure to fund has the potential to significantly dilute his ownership share from 83.2% to 32.7%. If the court finds in favor of the minority owners, it would enable Seldin and Kohlberg to potentially acquire a majority stake in the Suns and the Phoenix Mercury.
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In response, Ishbia’s spokesman reiterated that the allegations lack validity and accused Seldin and Kohlberg of attempting to pressure him into a buyout for their financial gain. The two minority owners currently remain as holdovers from the previous owner, Robert Sarver. Ishbia’s controlling stake was purchased for a reported $2.28 billion in 2023, whereas Sarver sold his share for $1.48 billion. In a letter from the Suns sent to Seldin and Kohlberg, it was clarified that the organization had no obligation to meet the demands of the minority owners, which sought a buyout at a valuation that would significantly inflate the team’s worth to $6 billion.
The lawsuit from Seldin and Kohlberg adds to a history of legal challenges faced by the Suns, with this being the seventh lawsuit filed since November 2024. Past allegations have included claims of discrimination, retaliation, harassment, and wrongful termination from both current and former employees associated with the franchise. The unfolding legal battles and disputes among ownership layers signal ongoing instability within the franchise, raising questions about its future governance and operations.
