Dodgers: Judge calls Fox Sports 'disingenuous' in opinion
Fox Sports was "disingenuous" by cloaking its self-interest in an argument that an early television-rights sale would hurt the Dodgers, U.S. Bankruptcy Judge Kevin Gross wrote in an opinion issued Thursday.
In the opinion, Gross explained why he ruled last week that the Dodgers could sell their TV rights along with the team, even if the team's current contract with Fox restricts them from negotiating with other broadcast outlets until Nov. 30. Fox has asked the U.S. District Court for a stay of Gross' ruling, pending appeal.
Gross called the provision forcing the Dodgers to negotiate only with Fox "not enforceable against a bankrupt entity," where the prevailing interest is in maximizing the sale price of the entity. He said Fox is jeopardizing that objective by seeking "the delay of negotiations" and advised Fox to make good use of its exclusive negotiating window, even if it now expires Jan. 19 rather than Nov. 30.
"It is within Fox's control ... whether it will negotiate in good faith and take advantage of its opportunity," Gross wrote.
Fox has alleged damages could exceed $1 billion, if the accelerated marketing process leads to its loss of the Dodgers' television rights and the closure of Prime Ticket.
Gross called Fox's damage claims "highly speculative and therefore unsubstantiated." Gross also cited as "never supported by evidence" the claim of former Fox Sports Networks President Robert Thompson that Fox would have discounted the Dodgers' contract by 25% without the negotiating rights now in dispute.
In his opinion, Gross wrote: "Fox was prepared to advance in excess of $300 million to Mr. McCourt without restriction and without any apparent concern for ... the Dodgers ... and regardless of how Mr. McCourt was going to use such a small fortune. That was when it benefited Fox, and MLB argued it mortgaged the future of the team.
"Now, when Fox faces changes to the [television contract], Fox raises arguments about what is in [the Dodgers'] best interest. Fox is not a credible party to raise such issues."
The creditors' committee endorsed the Dodgers' plan for an early sale of television rights. Gross called that endorsement "significant" and noted that no creditor beyond Fox objected.
— Bill Shaikin