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Lawsuit against Matt Ishbia includes two new financial statements filed in less-redacted court phoenix sun Minority owners say this could threaten Ishbia’s majority ownership of the team.
The filing, a copy of which was obtained by ESPN on Tuesday, is from a lawsuit filed Nov. 24 in Delaware state court by attorneys representing two Suns minority owners, Scott Seldin and Andy Kohlberg. An Ishbia spokesperson said there was “nothing new” in the filing and that its claims were “ridiculous”.
The lawsuit against Ishbia accuses him of financial misconduct, including using the team as a “personal piggy bank.” Ishbia, which will buy Sons in 2023, has denied such allegations.
The battle between the Suns minority owners and Ishbia can be traced back to September 2024, when Kohlberg began negotiating a buyout with an advisor to Ishbia. Seldin, meanwhile, did not seek a buyout. Kohlberg’s talks continued through 2025 and he asked for a response from Ishbia on June 1.
The next day, Ishbia called for a $250 million capital raising — asking investors to make actual payments on their financial commitments — and “threatened minority owners to punitively reduce their ownership interests” if they failed to fund it by June 12, according to the new filing. As part of the raise, new units of ownership will be issued at $10 million per unit — a figure that Seldin and Kohlberg say was a far cry from the valuation three months ago, when Ishbia bought Sun’s units from minority owners at $198 million per unit.
Under protest, the two minority owners say, they paid their share of the capital call increase.
According to the filing, Ishbia said the capital call increase was not fully funded and scheduled another capital call increase with a 10-day deadline on July 8.
Again, Seldin and Kohlberg say, they paid their share under the protests.
The two minority owners say they then sought internal financial records and filed a lawsuit against Ishbia in August to obtain them. Seldin and Kohlberg say they were shown a one-page document that claimed a “debt-to-equity conversion” was used to increase a portion of Ishbia’s contributions. But eventually, he says, they learned that Ishbia had failed to raise both capital calls by the deadline it had set.
“As a result of Ishbia’s plan to swap debt for equity, Ishbia itself did not finance any new cash by the capital call deadline, despite owning only 13% of the company, with minority owners funding approximately 38% of it,” the filing said.
Under the terms of the team’s operating agreement, Seldin and Kohlberg say, they should have been able to purchase the shares that Ishbia failed to fund.
In a statement Tuesday, Michael Karlinsky of Quinn Emanuel Urquhart & Sullivan, an attorney representing Seldin and Kohlberg, said, “The updated amended filing reveals that the $250 million capital call, issued with only ten days’ notice, was designed to allow Matt Ishbia to unfairly increase his ownership stake by severely diluting minority owners. The artificial price of $10 million per unit The obviously low valuation bears no relation to the actual value of the franchise, which Ishbia claimed, based on their own market analysis, was worth $7 billion or more in August 2025.
“Now that Ishbia’s failure to deliver funds in line with the terms of its capital call has come to light, we believe there is a risk that its ownership stake may be significantly reduced from 83.2% to 32.7%.”
To jeopardize Ishbia’s majority ownership, the lawsuit would require the judge to decide that Ishbia has failed to fund the capital call by its deadline and therefore, in accordance with the terms of the operating agreement, Ishbia must offer minority owners the opportunity to finance its unfunded shares at the $10 million per unit price set out in its capital call notice.
If this were to happen, Seldin and Kohlberg could take over majority ownership of the Sons. phoenix mercury With a share of about 60%.
“There is nothing new here and the claims are ridiculous,” an Ishbiya spokesperson said in a statement Tuesday. “Unwilling to take responsibility and invest in the team, these guys are resorting to threats and publicity stunts to buy out Matt so they can make more money.”
Seldin and Kohlberg are holdovers from the previous ownership group under Robert Sarver. In 2023, Ishbia bought a 57% controlling stake for $2.28 billion, as ESPN reported then, after the troubled server sold its 37% stake for $1.48 billion. At the time of the sale, 14 of the 16 partners of Sons’ ownership group accepted Ishbia’s buyout offer at a valuation of $4 billion.
Kohlberg and Seldin were the only two who did not sell.
Ishbia sued two Sons minority owners in October, saying they insisted he buy the shares he owned “at an excessive premium.”
ESPN previously reported that the Suns sent a letter to Kohlberg and Seldin in August, in which the team said both men demanded that the Suns purchase their ownership stake for $825 million, a figure that would value the team at approximately $6 billion — a 60% increase from the price Ishbia purchased his controlling interest in 2023.
In a letter obtained by ESPN, the Suns said they have no obligation to acquire Seldin and Kohlberg.
The latest lawsuit from Seldin and Kohlberg is the seventh against the Suns since November 2024. Others are filed by current or former employees. Some of her allegations include discrimination, retaliation, harassment and wrongful termination.
