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Dodgers accuse Fox of trying to drive down price of TV rights

November 28, 2011 | 10:45 am


Fox Sports wants to keep Dodgers owner Frank McCourt from realizing the maximum possible sale price for the team under the "faulty premise" that the company has a better chance to retain the Dodgers' television rights if they are not sold now, the Dodgers argued in a court filing Monday.

Fox has objected to the Dodgers' plan to sell those rights along with the team, with mediation between the parties set to start Monday. In the absence of a settlement, the U.S. Bankruptcy Court is scheduled to hear the matter on Wednesday.

"Fox's clear motivation in this proceeding is to minimize the value of [the Dodgers'] most significant asset by shutting out competing suitors for the post-2013 telecast rights, and pay as little as possible to capture them for itself," the Dodgers' filing says.

Fox has asked the court to uphold a provision in its current Dodgers contract that restricts the team from negotiating with any other media outlet until Nov. 30, 2012.  Fox says its damages could be "colossal" if the loss of the Dodgers' rights leads to the closure of Prime Ticket.

The Dodgers say damages would be minimal, if any. Even if the current contract is enforced, nothing in it guarantees that Fox can retain the Dodgers' rights, the team argued. In addition, since Fox has argued that the value of media rights historically rise over time, the Dodgers suggested that Fox could better serve its interests by negotiating now.

When the Dodgers initially proposed an early sale of television rights -- to finance McCourt's continued ownership of the team -- his ex-wife, the creditors' committee, Major League Baseball and Fox all objected. Now that McCourt has agreed to sell the team, he has neutralized all those parties save Fox.

The Dodgers argue that marketing the television rights now could lead to a higher sale price for the team, since a buyer would know what its TV revenue would be. The buyer would not be bound to accept whatever TV deal might be negotiated now.

The team accuses Fox of employing "delay tactics" that could threaten McCourt's ability to sell the team by April 30, as required in his agreement with MLB.

The filing also expresses disdain over Fox's suggestion last week that McCourt could include the Dodger Stadium parking lots in the sale if he wanted to make more money. For one thing, the Dodgers said, the team is in bankruptcy but the company that owns the parking lots is not.

"Even more remarkably, Fox seems to have forgotten that when its parent company sold the Dodgers to Mr. McCourt ... the parties entered into two separate agreements, one for the sale of the team and another for the sale of the stadium and the parking lots," the Dodgers' filing read. "The fact that Fox would now seek to force consolidation of those assets ... underscores the weakness of Fox's legal position."

The stadium is part of the sale.


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— Bill Shaikin

 Photo: Frank McCourt. Credit: Kirby Lee / U.S. Presswire.