RAJ Sports Sues Over Sale of Blazers Minority Stake

One NBA minority owner is suing another seeking to join the club.

RAJ Sports sued the Cherng Family Trust on Monday in an attempt to block its stake in the new Portland Trail Blazers ownership group led by Tom Dundon.

Dundon, the owner of the NHL’s Carolina Hurricanes, agreed to buy the Blazers for $4 billion in August from the estate of Microsoft cofounder Paul Allen, which first put the team on sale in May. The two sides “entered a formal sales agreement” on Sept. 12, and as part of that announcement revealed a group of minority owners, including the Cherng Family Trust, a family office and investment firm led by Andrew and Peggy Cherng, the founders of fast food chain Panda Express. 

RAJ Sports owns the NWSL’s Portland Thorns, the WNBA’s Portland Fire, and a minority stake in the NBA’s Sacramento Kings. They sued the Cherngs on Monday in a dispute where many facts remain unclear.

The Blazers’ current ownership, led by Allen’s sister, Jody, has no involvement in the lawsuit, nor do Dundon, the NBA, and WNBA, according to court documents. The lawsuit does not challenge Dundon’s pending ownership of the team. 

RAJ Sports is run by siblings Alex Bhathal and Lisa Bhathal Merage, heirs to their family’s swimwear and investment fortune. In addition to the Kings, Fire, and Thorns, the RAJ Sports portfolio includes minor league baseball team the Sacramento River Cats, Kings-affiliated esports team Kings Guard Gaming, and more.

The suit was filed under seal in the Delaware Court of Chancery, where many business disputes are handled due to Delaware’s long-standing role as the preferred state for U.S. companies to incorporate. The only documents available publicly are a proposed order that a judge will sign if RAJ’s motion for a temporary restraining order is granted, and a supplemental information sheet that contains very little information.

The proposed order offers some context about the suit. It reveals that RAJ wants a temporary restraining order that would prevent the defendants from entering into any agreement involving the Blazers, including the deal that has already been announced. It seeks to stop Cherng LLC from committing “further breaches” of a July 24 confidentiality and exclusivity agreement, although it’s not clear what that agreement is related to.

RAJ was reportedly interested in the Blazers after the Allen estate finally put up the team for sale in May. About a week after the team was put up for sale, it told Oregon Public Broadcasting it was “aware of the recent developments regarding the Portland Trail Blazers.” RAJ also said then that “we regularly evaluate strategic opportunities across the sports and real estate landscape, and we approach all such considerations with diligence and discretion. At this time, we have nothing further to share.”

There were rumors RAJ was part of a different group that made an unsuccessful bid. In August, The Oregonian reported that RAJ was “known to be making a push and wanted to keep the team in Portland.” A source familiar with the matter told Front Office Sports last month that Dundon’s group intends to keep the team in Portland.

Under NBA rules, RAJ would have needed to sell its Kings stake to become even a minority owner in the Blazers.

Other minority owners who are part of Dundon’s group include Sheel Tyle—the cofounder of Portland investment firm Collective Global—and Marc Zahr, co-president of Blue Owl Capital. 

The NBA’s board of governors has to approve any final purchase agreement, and the Trail Blazers sale is expected to close by the end of the year. The Blazers are the third NBA team to sell this year so far behind the Celtics in March for $6.1 billion and the Lakers in June for a record $10 billion. 

The Lakers sale to Dodgers owner Mark Walter is also awaiting board approval. Walter is already a minority owner of the team. 

RAJ Sports declined to comment. The Cherng Family Trust, Dundon, the NBA, and the WNBA all did not immediately respond to requests for comment.