Jul 29, 2014, 4:58 PM EST
For years now, the Nationals and Orioles have been at odds over TV revenue. It’s about to explode.
The back story: in order to allow the Nationals to start up business in Orioles territory back in 2005, the Orioles got a sweet TV deal. They got (a) majority ownership of the network, MASN, that broadcasts both Nats and Orioles games; and (b) they got way more in rights fees from the network for their games than the Nats got for theirs. Indeed, the Nats got a pretty undervalued amount, per the deal.
Starting in 2012, that undervalued piece ended and the Nats were to begin receiving rights fees from MASN that represented “fair market value.” They still haven’t received it as MASN — which, again, is controlled by Peter Angelos and the Orioles — has repeatedly balked. To placate the Nationals, Major League Baseball has been kicking back money to the Nats. Bud Selig also set up an arbitration, with a panel made up of other baseball owners and executives to determine what “fair market value” is.
The Hollywood Reporter has a bombshell of a story today in which it notes the following:
- That arbitration panel ruled in favor of the Nationals;
- The Orioles/MASN have still ignored it and haven’t paid;
- The Nationals and Orioles/MASN have each started getting testier with one another via attorney letters;
- Bud Selig wrote both clubs — and Hollywood Reporter has the letter — warning them that if they sue over this they’re in DEEP TROUBLE suggesting that they may have “the most severe sanctions” leveled against them if they do; and
- Both the Nats and Orioles seem to be ignoring Selig and are on a collision course in court.
This is a huge story inasmuch it (a) involves something huge like broadcast rights fees at a time when such fees dictate almost everything about the game; (b) shows that Bud Selig’s greatest strength as Commissioner — keeping the peace among clubs — is failing him in this case; and (c) we have the distinct possibility of club vs. club litigation, which means actual financial and business information in open court and THAT JUST DOESN’T HAPPEN IN MAJOR LEAGUE BASEBALL.
Oh, and those “most severe sanctions” Selig threatened the O’s and Nats with? Those include the sorts of sanctions that cost Frank McCourt ownership of the Dodgers. Of course McCourt was a wounded animal at the time. Would Selig dare try to go after Peter Angelos or the Lerners like that?
A big, big story. Great work by the Hollywood Reporter to get this out there when Major League Baseball’s m.o. is to never air its dirty laundry in public.
UPDATE: The Orioles and Attorneys for MASN just contacted me with official comments on the matter. From the Orioles:
“As those who follow the Clubs are aware, the Settlement Agreement between Baseball, the Orioles, and the Nationals established MASN to compensate the Orioles for the loss of market share and other damages caused by the relocation of the Nationals to Washington, D.C. Contracts are meant to be honored and the Orioles have every expectation that this contract will also be honored. The Orioles continue to work with the Office of the Commissioner to try and resolve this dispute.”
And from Thomas J. Hall, counsel for MASN:
“MASN has honored the terms of the Settlement Agreement, including the formula in that contract for resetting the Nationals’ telecast rights fees and expects all parties will do the same. That contract specifically includes an agreed upon and historically applied formula for resetting the Clubs’ telecast rights fees that has been applied by Baseball to virtually every other club-owned regional sports network. MASN is confident its contract will be honored and looks forward to further discussions with all parties to try and resolve this matter amicably. Our loyal viewers should understand this is a business dispute and will have no impact on the telecast of the Clubs’ games.”
Note the complete lack of reference to the arbitration Selig put together? Did the Orioles not participate in it, or are they just refusing to acknowledge its legitimacy now that it has resulted in a decision they don’t like?
One thing I do know: Peter Angelos is, more than anything, an able lawyer. And if he’s not running the show himself, he has people in place that are running it the way he’d like it to be run, and he has never feared going to court. Meanwhile, the Lerners did not get rich by being walked-over rubes. They are as litigious and determined as the next high-powered businessman, and likely more so.
Buckle your safety belts.
Dec 22, 2014, 10:47 AM EST
“You see what’s going on, but …”
Dec 22, 2014, 10:34 AM EST
Who will tell us that they’re “takin’ it one game at a time” now?!
Dec 22, 2014, 10:15 AM EST
Dec 22, 2014, 9:04 AM EST
He’ll be under team control through 2019.
Dec 22, 2014, 8:41 AM EST
Taped baseballs and Yankees fans.
Dec 22, 2014, 7:49 AM EST
Understated, it is not.
Dec 21, 2014, 11:10 PM EST
Wil Myers was rumored to be a potential target for the Phillies in a trade involving Cole Hamels, but it turns out the Padres plan to hang on to him.
Dec 21, 2014, 10:21 PM EST
Wil Ledezma will attempt to return to the major leagues with the Twins after signing a minor league deal.
Dec 21, 2014, 9:55 PM EST
Marco Scutaro’s 2014 season was tarnished by a chronic back ailment. The Giants’ training staff is preparing an update on the 39-year-old and it may not be good news.
Dec 21, 2014, 8:50 PM EST
If spring training were to start today, Yankees GM Brian Cashman would have Rob Refsnyder and Jose Pirela compete for the starting job at second base.
In which someone describes A-Rod, B.J. Upton and Ryan Howard as potential offensive options for a team
Dec 21, 2014, 7:45 PM EST
This needs to happen, people.
George Steinbrenner’s foundation will pay for the education of the children of the slain NYPD officer
Dec 21, 2014, 6:50 PM EST
The Silver Shield Foundation has done so for 32 years.
Dec 21, 2014, 5:47 PM EST
It makes a lot of sense. And now, it seems, the clubs themselves are starting to talk about it.
Dec 21, 2014, 4:17 PM EST
Is Smoltz really so different than Curt Schilling and Mike Mussina?
Dec 21, 2014, 2:50 PM EST
The field for James Shields has been winnowed down to a few, namely the Giants and Red Sox.
Dec 21, 2014, 1:35 PM EST
If the Padres want to keep Justin Upton around beyond 2015, they’ll have to hammer out a contract extension before spring training begins.
Dec 21, 2014, 12:27 PM EST
Scott Boras says the Orioles should expect to have Matt Wieters behind the plate when the 2015 regular season opens on April 6.
Dec 21, 2014, 10:55 AM EST
A.J. Preller, the second-youngest general manager in Major League Baseball, joined MLB Network this weekend to discuss the Padres’ incredibly active offseason …
Dec 21, 2014, 9:11 AM EST
Matt Kemp was introduced to the San Diego media on Saturday at Petco Park …
Dec 20, 2014, 11:50 PM EST
Exciting news for Willie Bloomquist fans.
- Phil Hughes signs a three-year extension with the Twins 12
- The Padres have talked to the Phillies about Cole Hamels 21
- Why is John Smoltz a shoo-in for the Hall of Fame? 57
- Phillies GM told Ryan Howard they’d be better off “not with him but without him” 85
- Trea Turner’s agent is unhappy his client is in limbo after trade to Nationals 48
- Nexen Heroes accept Jung-Ho Kang posting fee from unidentified MLB team 37
- Giants acquire Casey McGehee from the Marlins 16
- The Padres have given their fans something to talk about. Which is badly needed in San Diego. 64
- Bud Selig will get a $6 million a year pension. Which is obscene. (145)
- The United States will seek to normalize relations with Cuba (144)
- Rays, Padres, Nationals agree to 11-player trade (97)
- Chase Headley signs a four-year deal with the Yankees worth at least $52 million. (95)
- St. Petersburg City Council votes down deal to allow Rays to look for new stadium site (90)