Dodgers beat Fox Sports in court over rights


The Los Angeles Dodgers can try to sell future television rights to the team’s baseball games months earlier than their current contract with Fox Sports allows, according to U.S. Bankruptcy Judge Kevin Gross in Wilmington, DE. His 12/8 ruling overruled Fox’s objection to letting the team negotiate with Fox’s competitors early. The TV rights could be worth about $100 million a year, a consultant for Fox said in court.

“Everyone agrees that times are pretty damn good right now and we think it is time to capture it,” Bruce Bennett, an attorney for the Dodgers, told Bloomberg. He said the goal of accelerating negotiations for the TV rights is to increase the value of the team.

The team filed for bankruptcy in June with plans to sell the media rights to pay creditors and allow Frank McCourt to retain his ownership. McCourt later agreed to sell the team under a deal that ended a fight between Major League Baseball and the Dodgers. In a bankruptcy court hearing, the team and Fox Sports Net West 2 LLC fought over the proposal to solicit bids for future TV rights.

“The telecast rights are one of the Dodgers’ primary assets and have enormous long-term value,” the team said in a statement after the ruling.

Gregory Werkheiser, an attorney for Fox, said the company will appeal Gross’s ruling. In the next few days, Fox and the Dodgers will try to agree on whether negotiations for a new TV contract can begin immediately or must wait for an appeal.

“While we are disappointed in the judge’s decision, we understand the court process and will appeal this decision to protect our contractual rights,” Chris Bellitti, a Fox spokesman, said in a statement. “Those rights are material and valuable, and the current owner accepted them as binding when he purchased the team in 2004.”

Gross said he would take “a day or two” to write an opinion justifying his ruling.

Time Warner Cable is likely to bid for the rights, partly because the company won the right to show future LA Lakers’ basketball games on a new regional sports network.

Fox Sports can broadcast games through the 2013 season and had an exclusive right to negotiate a new contract until 11/30/12, according to court records.

McCourt agreed to sell after the team ended its bankruptcy court fight with Major League Baseball. As part of that effort, the Dodgers needed court permission to solicit bids on a new media rights contract. The team may be worth about $1 billion, according to court records filed by the Dodgers.

The approval to open negotiations early doesn’t guarantee a sale of the rights.
Under the settlement between the Dodgers and MLB, no sale of the TV rights can go forward without approval from MLB, Gross and whoever wins the bidding for the team.