Eugene Melnyk


Eugene Melnyk is a Canadian businessman who has resided in Barbados since February 1991. He is the current and sole owner, governor, and chairman of the Ottawa Senators professional ice hockey franchise of the National Hockey League. He is the founder, former chairman, and CEO of Biovail Corporation which was acquired by Valeant Pharmaceuticals. Canadian Business magazine ranked Melnyk 79th with a net worth of $1.21 billion on its 2017 list of Canada's 100 wealthiest people. He is also one of the richest residents of Barbados and has been referred to as the "Worst Sports Franchise Owner in North America".

Personal

Melnyk was born in Toronto, Ontario, on May 27, 1959, and is of Ukrainian heritage. He has resided in Barbados, a noted tax haven, since 1991.
In 2015, Melnyk underwent a liver transplant at a hospital in Toronto. Given his status as a permanent resident of Barbados, questions were raised regarding eligibility rules, as the Ontario Health Insurance Plan requires patients to make their primary residence in Ontario and spend at least 153 days in any one-year period to maintain their coverage. Some observers questioned how Melnyk, a permanent resident of a foreign country, could be eligible to receive the transplant. Citing privacy laws, the hospital would not discuss personal health information beyond discussing the transplant and the patient's recovery.

Business career

In 1982, Melnyk founded medical publishing company Trimel Corporation, which was sold to Thomson Publications in 1989. Melnyk then founded Biovail Corporation, a specialty pharmaceutical company, in 1989. During his time as chairman and CEO of Biovail, revenues grew from $19 million in 1995 to $1.067 billion in 2006. One of Biovail's strategies was to look for drugs with expired patents, then reinvent them with the company's proprietary technologies. One example was producing drugs that had controlled-release features that let patients take the drug once a day instead of several times.
In 2003, at approximately the same time as he purchased the Ottawa Senators, Melnyk erroneously told investors that a drug shipment destroyed in a truck accident was responsible for a revenue shortfall. This situation led to a hearing with the Ontario Securities Commission, who administer and enforce securities legislation in the province. A legal representative for Biovail claimed that Melnyk "unknowingly" divulged this misleading and "somewhat imperfect" information. He insisted regulators were basing their entire case against Melnyk on portions of evidence taken out of context.
Melnyk left Biovail on June 30, 2007 following news that the United States Securities and Exchange Commission planned to take legal action against him over "trading and reporting ownership positions in Biovail securities."
In March, 2008, the United States Securities and Exchange Commission sued Melnyk and Biovail for accounting fraud. The SEC press release claims that Melnyk and other executives "repeatedly overstated earnings and hid losses in order to deceive investors and create the appearance of achieving earnings goals. When it ultimately became impossible to continue concealing the company's inability to meet its own earnings guidance, Biovail actively misled investors and analysts about the reasons for the company's poor performance." Biovail settled for $10 million US.
In May 2011, Melnyk was banned from senior roles at public companies in Canada for five years and fined $565,000 by the Ontario Securities Commission. Melnyk also settled with the SEC, and agreed to pay a civil penalty of $150,000, in addition to $1 million previously paid to settle other claims with the SEC.

Sports franchise owner

Mississauga IceDogs

Melnyk's first foray into sports franchise ownership came in 2001 with the purchase of the St. Michael's Majors of the Ontario Hockey League. At the time, the club played at the St. Michael's College School's Arena in Toronto, but Melnyk aimed to move the team to nearby Mississauga. As there was already an OHL team in Mississauga, the Mississauga IceDogs, Melnyk subsequently purchased the IceDogs franchise in 2006 and resold them in 2007 in order to facilitate the move of the Majors from Toronto to Mississauga. Per the deal arranged by Melnyk, the IceDogs' new ownership relocated the team to St. Catharines, Ontario and the team became known as the Niagara IceDogs. On May 10, 2012, Melnyk sold the St. Michael's Majors to Elliott Kerr for an undisclosed price.

Ottawa Senators

On August 26, 2003, Melnyk purchased the Ottawa Senators NHL franchise along with their arena, then known as the Corel Centre. At that time the team was facing bankruptcy and an uncertain future in Ottawa, and was purchased for the sum of US$92 million.
By November, 2016, the Ottawa Senators were listed by Forbes magazine as the NHL's twenty-third highest valued franchise at US$355 million. Though the team enjoyed some success on the ice under Melnyk's leadership, culminating in a trip to the Stanley Cup Finals in 2007, fans in Ottawa had gradually become disillusioned with Melnyk's management style and perceived unwillingness to spend the money needed to build a championship caliber team. This has resulted in pressure from the Senators' fanbase for a change in team ownership, with Melnyk himself being cited as "the worst sports franchise owner in North America" by some in the sports media. In March, 2018, a GoFundMe campaign organized by local fan Spencer Callaghan raised more than $10,000 in under a month, with the funds used to erect four billboards across Ottawa calling for Melnyk to sell the team, with the message "#MelnykOut". A fifth billboard was scheduled to go up on April 2. Callaghan told media that he felt the team was being mismanaged under Melnyk's leadership, and had demonstrated a willingness to drive both players and front office staff away, citing the recent losses of President and CEO Cyril Leeder, who had been with the organization since its inception, and popular players such as Kyle Turris and Daniel Alfredsson. Leeder's replacement, Tom Anselmi, submitted his resignation to Melnyk less than a year later. Fans were also deeply concerned at rumours that the team's popular current captain, Erik Karlsson, was also about to be traded away, a rumour that ultimately came true months later in September 2018, further alienating the fanbase. Many fans began declaring on various social media platforms their personal boycotts of Senators' games, typically directing their complaints at Melnyk. Despite this backlash, Melnyk has often stated on the record that he has no intention of selling the franchise.
Senators fans were further infuriated in 2017 when Melnyk told reporters that he would be open to the idea of moving the franchise to a different city if the fanbase didn't make efforts to increase attendance at Senators' home games. "I'm not going to blow a lifetime of working hard to support a hockey team. It's not gonna happen", Melnyk said, adding "It's a franchise. Imagine if you own a McDonald's franchise, but you can move it. Why would you sell it?". Melnyk also reiterated he was not seeking buyers or equity investors to solve the team's problems. When pressed by reporters to clarify whether or not he would consider moving the team out of Ottawa, Melnyk replied, "If it becomes a disaster, yes. If you start not seeing crowds showing up, yes."
On September 11, 2018, the Senators released a video online in which Melnyk outlined the franchise's plans for a rebuild. The video received considerable criticism from fans and media for its awkward presentation and for the owner's own characterization of his team as being "in the dumpster". The relationship between Melnyk and Senators' fans further deteriorated at the 2019 trade deadline when the Senators traded away their leading scorers and remaining core players, Matt Duchene, Ryan Dzingel, and Mark Stone, all of whom were well liked in the community. Despite earlier promising to make every effort to re-sign the star players, Melnyk later contradicted himself when he was quoted as saying that trading away Mark Stone had been " for some time" as part of the rebuild.
In November 2018, fingers were pointed at Melnyk after a collection of newly created and suspicious Twitter accounts began appearing, all of which praised Melnyk's performance while attacking his detractors. The Twitter accounts largely targeted certain writers who covered the Senators for local newspapers the Ottawa Citizen and Ottawa Sun, making similar claims that these writers had treated Melnyk unfairly. Speculation immediately arose that these were bot accounts and not real human beings. A subsequent investigation conducted by the Ottawa Citizen revealed that, although the bots could not be conclusively traced back to Melnyk, they were "created to launch a co-ordinated disinformation campaign and to attack media coverage of the Sens while lauding the team and its owner Eugene Melnyk".
At a July, 2019 concert by The Rolling Stones near Barrie, Ontario, Melnyk claimed he was confronted by Lisa MacLeod, Conservative MPP for the Ottawa suburb of Nepean. According to Melnyk, MacLeod angrily approached him and told him "I am your minister and you're a fucking piece of shit and you're a fucking loser." Melnyk subsequently issued a written complaint to Ontario Premier Doug Ford. Susan Truppe, director of public affairs and deputy chief of staff for MacLeod's office, was standing near MacLeod when Melnyk alleged that the verbal assault took place, and she disputed Melnyk's account. "I don’t even know what he’s talking about," Truppe told the Ottawa Citizen, adding "I certainly didn’t hear that. I remember watching what it was, but I didn’t hear that whatsoever."
Senators' attendance suffered under Melnyk, and during the 2018-19 season the team set a franchise record for unfilled seats, with attendance dropping to a 22-year low. During that season, the team drew an average of 14,553 fans to its home games, the team's lowest attendance figures since it began playing in its current arena towards the end of the 1995-96 season. Attendance had already been trending downward since 2012-13, when Senators' home games attracted an average of 19,408 fans.
As of late 2019, Melnyk remains the team's sole owner and holds the additional titles of governor and chairman.

Other

On September 16, 2008, Melnyk proposed plans for an Ottawa Major League Soccer professional soccer team, and a new soccer-specific Ottawa Soccer Stadium but could not obtain support from Ottawa's municipal Council. Instead, the Mayor and Council chose a different site for the Canadian Football League's Ottawa Redblacks franchise.
In 2009, Melnyk served as chairman of the IIHF World U20 Championship.

Mohegan Sun lawsuit

In July 2019, Melnyk was sued by Connecticut casino Mohegan Sun for more than US$900,000. According to court documents, Melnyk attempted to pay the casino with five bank drafts totaling $900,000 following a 2017 St. Patrick's Day gambling spree. The first draft was issued on March 17, 2017, while four more were issued the ensuing Sunday, three within one hour of one another. The first four drafts were for $200,000 each and the last one was for $100,000. The drafts were subsequently "dishonoured" by the bank. Mohegan Sun management was forced to initiate legal proceedings against Melnyk to recoup that money, plus an additional $15,000 in damages, costs and interest.

Business ventures

Eugene Melnyk is involved with various charitable organizations. His primary charitable focus is on helping children and the elderly. His involvement has included:
Eugene Melnyk was born and raised in Toronto, Ontario. He now resides permanently in Barbados. He is divorced and has two children.
Melnyk was made honorary Colonel of the No. 414 Squadron RCAF.
On May 19, 2015 Melnyk underwent a successful liver transplant surgery at Toronto General Hospital.