Three MLB Teams File New Motions to Force Diamond Sports to Pay or Relinquish Rights
Three MLB Teams File New Motions to Force Diamond Sports to Pay or Relinquish Rights
There were a few ways the bankruptcy court proceedings between Sinclair Broadcasting Group’s subsidiary Diamond Sports Group (DSG) and Major League Baseball potentially could have gone. As those proceedings continue, however, it’s becoming more apparent that an ugly fight between the two sides could be shaping up.
The writing has been on the wall since last fall, when MLB officials gave an unencouraging update regarding DSG’s efforts to pursue more baseball clubs’ streaming rights. DSG owns and operates the collection of 19 regional sports networks (RSNs) under the Bally Sports brand, as well as the streaming platform Bally Sports+.
The company currently holds the broadcast rights to 14 MLB clubs, but the streaming rights to just five. In the months since last fall, MLB has been unwilling to cut DSG any slack, as the NHL and NBA have both done in DSG’s attempts to sort out its $8 billion debt load in bankruptcy court. Things took another step toward ugliness last week when the league filed an emergency motion with the court to force DSG to either pay its broadcasting rights fees to the Cleveland Guardians and Minnesota Twins or surrender those rights back to their respective clubs.
Diamond could have decided to give the rights back as MLB has been asking, but a new report from Front Office Sports shows the company is going to be stubborn in holding onto its baseball rights. This week, lawyers from the Guardians, Twins, and Arizona Diamondbacks have all filed emergency motions with the court protesting that they still haven’t been paid by DSG.
Attorneys writing on behalf of the Arizona team noted that DSG is continuing “to consume the Diamondbacks’ product without paying for it.” Lawyers representing the Guardians and Twins said Diamond is making use of their teams’ “unique and exclusive intellectual property without paying a single penny for it.”
Now, DSG is filing a motion of its own for a hearing on how much the rights it has not yet paid for are really worth. The hearing will be in advance of a request on Diamond’s part to be obligated to pay “only the reasonable value of the rights.”
The Twins’ and Guardians’ representatives shot back, noting that “only after defaulting on their payment obligations do the debtors [DSG] even raise the fanciful argument that they can choose to not pay the agreed-upon contractual rate.”
Diamond has requested its hearing to take place May 12, so there’s a good chance this process will continue to drag out. The judge could simply run out of patience with DSG and send the broadcast rights in question back to their respective clubs, but in bankruptcy court corporations are usually given a bit of leeway as they try to restructure their debt.
These teams will continue to be shown on their respective Bally Sports RSNs for the time being, so fans won’t notice any interruption. But the fight between Diamond Sports and MLB looks like it’s just heating up, and may lumber on into the summer months at this rate.
Bally Sports+
Bally Sports+ was a direct-to-consumer streaming service that provided live, in-market games without requiring a cable or satellite subscription. It allowed fans to watch their local Bally Sports regional sports network (RSN) without a traditional TV package.