Bloomberg News

Fox Sports Objects to Dodgers’ Plan for Bankruptcy Exit

April 11, 2012

News Corp.’s Fox Sports objected to the Los Angeles Dodgers’ bankruptcy reorganization plan, which hinges on a $2 billion sale of the baseball team, over the broadcaster’s rights to renegotiate a contract to televise games.

“The plan does not contain sufficient information” to allow Fox to ascertain whether its telecast rights are being impaired, it said in court papers filed yesterday in U.S. Bankruptcy Court in Wilmington, Delaware.

Fox seeks a written affirmation that Time Warner Cable Inc. (TWC:US) or an affiliate isn’t part of the group buying the equity interest of the Dodgers. The broadcaster wants the omitted portions of the plan and sale agreement disclosed to determine if its telecast rights have been violated. Fox also wants confirmation that the buyers don’t have formal or informal agreements with Time Warner Cable or any other media outlet that could harm its rights.

Fox “looks forward to continuing its positive and productive relationship with the Dodgers under their new ownership” if the team complies with the information requests, lawyers for the broadcaster said in court papers.

Frank McCourt, the team’s owner, put the Dodgers into bankruptcy in June, claiming Bud Selig, the Major League Baseball commissioner, forced the team into a cash crisis by rejecting a new contract with News Corp. (NWSA:US)’s Fox Sports, which holds the club’s television rights through the 2013 season.

New TV Deal

Once under court protection, McCourt lost the support of the network when he tried to solicit bids for a new television deal earlier than allowed under the Fox Sports contract.

U.S. Bankruptcy Judge Kevin Gross in Wilmington is scheduled to consider approval of the plan at a hearing April 13. The sale must be completed by April 30, the day McCourt is required under a divorce settlement to pay his ex-wife.

Fox argues that although the Dodgers have filed papers stating “that Time Warner Cable is not purchasing” the team, the possibility remains, and needs to be disclosed, that it may be an investor in the purchasing group “or is otherwise indirectly funding the purchase.”

“The Los Angeles Dodgers anticipate confirmation of the debtors’ plan of reorganization on schedule,” Robert Siegfried, a spokesman for the Dodgers, said in an e-mail. “The Debtors view Fox’s objection as without merit.”

The case is In re Los Angeles Dodgers LLC, 11-12010, U.S. Bankruptcy Court, District of Delaware (Wilmington).

To contact the reporters on this story: Michael Bathon in Wilmington, Delaware, at mbathon@bloomberg.net; Dawn McCarty in Wilmington, Delaware, at dmccarty@bloomberg.net.

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net.


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Companies Mentioned

  • TWC
    (Time Warner Cable Inc)
    • $142.98 USD
    • 2.05
    • 1.43%
  • NWSA
    (News Corp)
    • $15.73 USD
    • 0.22
    • 1.4%
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