General Watson rules out legal action

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New Zealand Warriors owner Eric Watson has all but ruled out legal action against the NRL over the club's salary cap punishment, which he called unfair treatment of a non-Australian club.

The Kiwi businessman also said today the club would have its books independently audited every six months to ensure future compliance and independent directors added to its board.

The NRL on Tuesday docked the Warriors four competition points and fined the club $NZ480,000 for breaching the competition's salary cup in 2004 and 2005 by almost $NZ1 million.

Watson said while the club would suffer a multi-million dollar loss this year, he and partner Mark Hotchin are committed long term to supporting the Warriors and rugby league in New Zealand.

He said legal action against the NRL over the punishment was unlikely.

"Clearly, it's early days and we do have to look at our options and just understand where we're at," Watson told reporters by telephone from Colorado.

"I don't think legal action is a really good outcome for anybody," he said.

However, the Cullen Sports owner said he'd received unsolicited advice that the NRL's $A3.36 million salary cap is not enforceable under New Zealand law.

Watson said while the NRL fine was acceptable the points deduction was not.

"The trans-Tasman rivalry going back more than 100 years is based on playing on an even playing field and this puts us in a very difficult position.

"It's tough on the players, tough on the New Zealand fans. I mean, it's hard enough beating you Aussies as it is without having given you a start."

Watson said he had not spoken about the salary cap breaches to the man widely blamed for them - former chief executive Mick Watson.

He would not comment further about the Australian, who ran the club for five years, except to say he no longer worked for Cullen Sports.

The club owner said he had learnt of the breach at the same time as the board, and backed embattled chairman Maurice Kidd to stay in the job.

"I'm very supportive of the board we have in place ... if we do add we'll be looking to add further independents to the board."

The club would also have outside monitoring of player payments to prevent a further breach.

"(We'll) have independent auditors on to audit the salary cap for us on a six-monthly basis so that our board can be very confident, along with management, that there is no possible breach within the organisation.

"Perhaps that's something all NRL clubs should need to do."

Watson insisted, despite the current setback, that under its new management the Auckland-based franchise has a strong future.

"The Warriors can be a jewel in the crown of the NRL, we proved that in the early days."


it's good that he is taking no legal action but i think that an appeal against the points deduction is just.

David James_old

I must say I am quite pleased with how this management is conducting itself thus far.

Only time will tell for the future though.


Here's more info from the Sydney Morning Herald:

WARRIORS owner Eric Watson yesterday admitted the club faced a "multi-million dollar loss" this season if it did not regain the four competition points stripped for breaching the salary cap.

Watson, who all but ruled out taking legal action against the NRL over the points loss and $430,000 fine, revealed in a telephone hook-up from Colorado with journalists that the Warriors had suffered a $1 million deficit last season and said this year's financial result was almost certain to be worse.

However, the millionaire Kiwi businessman reaffirmed his commitment to the club and said the Warriors were happy to be starting the season with a clean slate after the new management team of chairman Maurice Kidd, chief executive Wayne Scurrah and football director John Hart had actively searched for cap indiscretions to report to the NRL.

In an attempt to avoid a repeat of the $860,000 breach over the past two seasons, Watson said the Warriors would employ independent auditors to monitor their salary cap spending and suggested other clubs should do likewise.

While refusing to comment on whether rival clubs were also breaching the cap, he said: "There are obviously a lot of former players still working for clubs within the NRL … and those benefits can impact on today's salary cap if they are promised early on.

"We should have had more focus on that, we didn't, but we've corrected that now. I can't say whether that [guaranteed jobs for players in retirement] is the main reason, I think there's a range of reasons that have occurred in the last couple of years and the management team have gone back and basically found any possible item that could possibly in any way breach the salary cap and made sure that it's on the table.

"Clearly we found ourselves to be at fault but we owned up and, to use an Australian term, we 'dobbed' ourselves in and are taking the punishment. We don't want that to happen again, so we're going to make sure we are cleaner than clean going forward.

"As shareholders, we have taken the view to bring in independent auditors, as we do with all of our accounts and other companies. It's a smart thing to do with such a serious matter .. maybe it would be a very good idea for other clubs to do that and get themselves sorted out before the start of the season."

While expressing full confidence in the current management, Watson refused to criticise former chief executive Mick Watson over his running of the club for the five years up until last November or to answer questions about whether he still worked for him.

However, he admitted the club had operated at a loss last year, saying: "Off the top of my head I can't tell you the numbers but it was, I think, around $1 million."

Asked what impact starting the season on minus four points would have on the club's finances, he said: "We'll have a multi-million loss this year."

But Watson insisted he and partner Mark Hotchin weren't involved in league to make money and said any profits they made would be put back into the game. "For Mark and I it would be easy to walk away but instead we are committing more millions of dollars to make this thing work," he said.

While admitting it would be tough for the Warriors to start the season with "a mountain of points to climb", Watson said he was encouraged by the reaction of the players, sponsors and fans. "People are saying it's unfair but let's get behind the players," he said. "I wouldn't want to be the team playing us in the first round. When we're the underdogs we play a lot better."

Meanwhile, the NRL is investigating claims by Cronulla forward Lance Thompson that he had been offered a job after retirement by his former club, St George Illawarra. The Dragons yesterday re-signed Test centre Matt Cooper for two years.

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