ARLINGTON, Texas — A U.S. federal judge approved Diamond Sports Group’s wind-down plan on Wednesday, paving the way for a potential endgame and its bankruptcy proceedings. However, questions and contingencies still loom, especially regarding Diamond’s dealings with Major League Baseball and two of its teams.
Diamond, which operates Bally’s regional sports networks, still has deals in place with 11 MLB teams, but two are at risk and could be terminated soon. According to people briefed on the proceedings who were not authorized to speak publicly, the teams whose television deals are on the cusp of being severed are the Cleveland Guardians and the World Series champion Texas Rangers.
If the Diamond drops those two teams, the clubs would regain their rights and could be broadcast by either league in 2024, as the Padres and Diamondbacks were for part of the 2023 season. Alternatively, the Guardians and Rangers could make a deal with another broadcaster to carry the games.
“Our intention is to broadcast virtually all (of our) Major League Baseball teams next year,” Diamond’s lawyer said in court Wednesday. “There are a few, very few, that we don’t have agreements on. And that, frankly, at this point, is too expensive for us to broadcast without concessions. I’ve been told that those discussions are ongoing, and there have been communications with both teams involved.
The Guardians will receive $55 million in 2023, Per cleveland.com. The average annual value of the Rangers’ 20-year deal, which began with the 2011 season, is said to be $111 million.
“There is no agreement with MLB, there is no agreement with the Rangers, and we do not know what (Diamond’s) intent is with respect to the Rangers,” the Rangers’ attorney said Wednesday in court.
MLB declined to comment after the hearing. The league has been pushing for certainty regarding broadcast and revenue agreements for 2024, and a hearing on the proposal put forward by the league is expected to be held no later than December 8. So far, there’s nothing stopping Diamond from potentially landing additional teams outside of the Guardians or Rangers before the end of the 2024 season.
Diamond Sports, which owns 19 regional sports networks across the country that broadcast NBA, NHL and MLB games, has been in bankruptcy court since March. Since then, leagues and teams have been in a state of uncertainty about their broadcast operations and the revenue associated with them. The parties gained some additional clarity in court on Wednesday, when Judge Christopher Lopez approved a plan submitted by Diamond Sports that would allow it to continue broadcasting NBA, NHL and MLB games through September 2024 — the end of the baseball season — while trying to operate as profitably as possible. Then start reducing and trying to repay creditors, including by liquidating or selling assets.
But expectations can change from here. Lopez said two proposals, including one put forward by MLB, “could torpedo the entire cooperation agreement, but this is the way the parties have prepared it, and I think I have to take each proposal individually.”
Overall, the NBA and NHL have a better understanding of their future with Diamond than MLB does.
Lopez on Wednesday agreed to a term sheet between the NBA and Diamond Sports that would allow Diamond’s RSNs to continue broadcasting local broadcasts of 15 NBA teams through the 2023-24 season. The local television and direct-to-consumer rights for those teams would then revert to the franchises and the league.
Diamond is also in talks with the NHL about an agreement similar to the one it reached with the NBA. An attorney representing Diamond told the judge he expected the matter to be finalized by the beginning of next week.
(Top photo of Game 2 of the 2023 World Series in Arlington, Texas: Eric W. Rascoe/Sports Illustrated via Getty Images)
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