Joint announcement ends multi-year legal fight over control of American Airlines Center and franchise agreement obligations.
The Dallas Mavericks and Dallas Stars announced Monday, August 17, 2026, that they have reached a formal settlement resolving their long-running legal dispute over American Airlines Center, with both franchises confirming they will remain co-tenants at the downtown Dallas venue through at least the 2030-31 season. The agreement, delivered through a joint statement from the two organizations, brings to a close a bitter business court battle that had pitted the NBA and NHL franchises against each other over control of the arena and compliance with a decades-old franchise agreement with the City of Dallas.
The joint statement said the teams "have reached an agreement that resolves the outstanding matters between the two organizations," and confirmed that "American Airlines Center will continue to serve as the home of both teams at least through the 2030-31 season." Stars spokesman Joe Calvillo added that the matter "has been amicably resolved to the satisfaction of both parties, and the parties have and will have no further comment on this matter."
Roots of the Legal Battle Over the 1998 Franchise Agreement
The dispute traces back to a 1998 franchise agreement with the City of Dallas that established the framework for American Airlines Center, which opened in 2001 as the shared home of the Mavericks and Stars. That agreement required both teams to maintain their headquarters within Dallas city limits. In October 2024, the Mavericks first raised complaints alleging the Stars had violated that requirement, setting off a chain of escalating legal action.
The conflict intensified on October 28, 2025, when the Mavericks filed a 253-page petition in Texas Business Court seeking injunctive relief, a formal declaration that the Stars breached the agreement, and clarity over control of the Center Operating Company, the joint entity responsible for running the arena. The Stars responded with counterclaims, leading to what Dallas News described as both sides trading "blows in court" through dueling lawsuits by March 2026.
Escrowed Revenue and Financial Pressure on Both Franchises
As the litigation dragged on, arena revenues for both teams were placed in escrow, cutting off their normal quarterly distributions for roughly a year. The Stars estimated their lost payments during that period reached into the "tens of millions" of dollars, according to coverage from December 2025. That financial strain added urgency to a case that had already drawn significant attention across the Dallas sports and business community.
The case proceeded through a series of scheduled hearings in January, March and April 2026 before Texas Business Court Judge Bill Whitehill, with attorneys Chip Babcock representing the Mavericks and Frank Carroll representing the Stars. A jury trial had initially been slated for May 2026, positioning the dispute for a high-profile courtroom showdown over control of one of Dallas's premier sports venues.
Pretrial Rulings Shifted Leverage Toward the Mavericks
That trajectory changed in early April 2026, when Judge Whitehill issued a 91-page opinion addressing seven summary judgment motions. The rulings largely favored the Mavericks, affirming their right to pursue redemption of the Stars' 50% stake in the Center Operating Company for just $110, without requiring a board vote. The decision significantly strengthened the Mavericks' negotiating position heading into any trial.
Days later, on April 9, 2026, the Mavericks withdrew their claim for monetary damages against the Stars while continuing to press for a broader resolution of the legal fight. By May 8, 2026, Dallas News reported that the case would not proceed to a jury trial after all, noting the Mavericks had secured victories in every critical pretrial decision and that no appeals were pending. At that point, the only unresolved issue appeared to be attorney fees, estimated at roughly $3.6 million per team.
Settlement Clears Path for Arena Revenue and Future Plans
The August 17 settlement effectively closes the business court case without a trial, resolving the contract breach claims and the fight over Center Operating Company control through private agreement rather than a jury verdict. Both teams are expected to resume normal receipt of arena revenues that had been held in escrow throughout the dispute. Beyond confirming the 2030-31 arena timeline, the teams have not disclosed specific terms covering ownership shares, financial transfers or any modifications to the original 1998 franchise agreement, stating only that the matter is resolved and declining further comment.
Separate business reporting indicates that both franchises are expected to leave downtown Dallas once their current arena leases expire after the 2030-31 season, with the Mavericks reportedly exploring a new arena site in far North Dallas and the Stars associated with a proposed multi-billion-dollar sports and entertainment district in Plano. Those plans remain described as development intentions rather than finalized commitments, but they underscore that Monday's settlement, while ending years of courtroom conflict, may mark a transitional period rather than a permanent arrangement for either franchise.
