Camden Depot: Two New Developments In MASN Dispute

[weams]

I doubt he is too fazed by the prospect that some of his emails will have to be produced (sorry, weams, but that's my opinion).

You were the opinion I was hoping for. I am simply a rabble rouser on the subject. Thanks for the effort.

[Frobby]

You were the opinion I was hoping for. I am simply a rabble rouser on the subject. Thanks for the effort.

The evidentiary hearing in this case is only five weeks away. That should be a humdinger. MASN has won all the procedural battles so far, but will it win the war?

I will give you my very superficial take. In the law, there is a very strong presumption that the courts should not interfere with arbitration awards except in very extreme circumstances. The reason for that is simple: the whole purpose of arbitration is to get disputes resolved without using the court process, so if the courts just second guess every arbitration decision from scratch anyway, what is the point of going to arbitration? Therefore, the burden of proof is very heavily on MASN/the Orioles. Showing the decision was wrong, or that the arbitrators made some errant conclusion of law or fact, isn't enough. They have to make a very strong showing that the panel was biased, or something similar. The court found they had made enough of a preliminary showing to freeze the award until a full hearing could take place, and has granted MASN/the Orioles some discovery to give them a chance to prove their case. But based on what I've read so far, I think there's a bit of smoke but no real fire. The decision, if you read it, doesn't rule completely in favor of either side. The argument that the RSDC was biased because the Nats' law firm has done a lot of work for MLB and certain clubs seems pretty weak to me. The argument that MLB interfered in the decision making process of the RSDC also seems weak because the role MLB played here was not any different than it has traditionally played in RSDC hearings. The argument about the $25 mm advance to the Nats doesn't hold water because MLB did that after the RSDC made its determination, not before, and the RSDC wasn't involved in that decision. At the end of the day, I just don't think MASN/the Orioles will meet the very heavy burden they have, based on what I've read (which is only a tiny fraction of what's available to read in the court record).

Even if I'm wrong, and the court finds the process was tainted, I don't think the court will do anything more than order another arbitration, and who knows if that comes out better or worse?

If you ask me, both sides got a decision they can live with, and they should live with it.

[atomic]

Montreal to Toronto is about twice the distance between New York and Baltimore.

And they speak different languages.

[atomic]

The evidentiary hearing in this case is only five weeks away. That should be a humdinger. MASN has won all the procedural battles so far, but will it win the war?

I will give you my very superficial take. In the law, there is a very strong presumption that the courts should not interfere with arbitration awards except in very extreme circumstances. The reason for that is simple: the whole purpose of arbitration is to get disputes resolved without using the court process, so if the courts just second guess every arbitration decision from scratch anyway, what is the point of going to arbitration? Therefore, the burden of proof is very heavily on MASN/the Orioles. Showing the decision was wrong, or that the arbitrators made some errant conclusion of law or fact, isn't enough. They have to make a very strong showing that the panel was biased, or something similar. The court found they had made enough of a preliminary showing to freeze the award until a full hearing could take place, and has granted MASN/the Orioles some discovery to give them a chance to prove their case. But based on what I've read so far, I think there's a bit of smoke but no real fire. The decision, if you read it, doesn't rule completely in favor of either side. The argument that the RSDC was biased because the Nats' law firm has done a lot of work for MLB and certain clubs seems pretty weak to me. The argument that MLB interfered in the decision making process of the RSDC also seems weak because the role MLB played here was not any different than it has traditionally played in RSDC hearings. The argument about the $25 mm advance to the Nats doesn't hold water because MLB did that after the RSDC made its determination, not before, and the RSDC wasn't involved in that decision. At the end of the day, I just don't think MASN/the Orioles will meet the very heavy burden they have, based on what I've read (which is only a tiny fraction of what's available to read in the court record).

Even if I'm wrong, and the court finds the process was tainted, I don't think the court will do anything more than order another arbitration, and who knows if that comes out better or worse?

If you ask me, both sides got a decision they can live with, and they should live with it.

So if the Orioles lose this can they appeal and still hold up the Nationals getting money while the appeal process plays out?

[SteveA]

The Expos moved because Jeff Loria destroyed the team and the fanbase.

And the stadium fell apart.

[SteveA]

Montreal to Toronto is about twice the distance between New York and Baltimore.

But they're in the same state.

[Frobby]

So if the Orioles lose this can they appeal and still hold up the Nationals getting money while the appeal process plays out?

They can appeal but I tend to doubt the payment obligations would be held up any further.

[UpstateNYfan]

And the stadium fell apart.

The stadium was a poorly built remnant of the Olympics. Montreal took a bath on the Olympics (as almost all cities/States do) and were not going to build anything new. Plus poor ownership. I don't know what the fan base is there but it certainly didn't work out.

[Mayor McCheese]

I found it very interesting that MLB wants MASN to sell their entire network to Comcast. That could mean Comcast will control their entire regional sports market in the Mid Atlantic area.

An owner of a MLB franchise should not also be the majority owner of the RSN.

[Mayor McCheese]

The stadium was a poorly built remnant of the Olympics. Montreal took a bath on the Olympics (as almost all cities/States do) and were not going to build anything new. Plus poor ownership. I don't know what the fan base is there but it certainly didn't work out.

I was in Montreal in late March for a bach party when they had a few MLB presason games and we were able to score some tickets. Let me just tell you it was nuts, even just a exhibition game. The crowd was insane! The fans were great and it was a really cool expierence.

Between Montreal and Quebec (2 hours drive north east of Montreal) there is a strong baseball fan base but I doubt they ever get another franchise up there.

[Frobby]

An owner of a MLB franchise should not also be the majority owner of the RSN.

Why not, if that's the best way to maximize profits from the baseball team's TV rights? Let's say Comcast is willing to pay $75 mm/year for the broadcast rights, but the owner concludes the team can make $100 mm/yr if it forms its own RSN. Why should MLB preclude that from happening?

[Mayor McCheese]

Why not, if that's the best way to maximize profits from the baseball team's TV rights? Let's say Comcast is willing to pay $75 mm/year for the broadcast rights, but the owner concludes the team can make $100 mm/yr if it forms its own RSN. Why should MLB preclude that from happening?

Those profits should be invested back into the club right?

Not the Peter G Angelos law building on Charles St.?

[incubus]

I've stayed on the sidelines over this whole mess. What am I missing though? I thought that part of letting Washington have a team was giving the Orioles a chunk of the TV money for a period of time. Why is this all going on? Do the Nationals feel that the deal that they signed wasn't fair or is this just the regular cycle to negotiate a new % with us and the Nationals?

Someone more knowledgeable please enlighten me.

This article from Camden Depot does a good job of explaining the dispute and why the Orioles and MASN have a sound arguement.

http://camdendepot.blogspot.com/2014/03/explaining-nationalsmasn-dispute.html?m=1

[Nigel Tufnel]

Those profits should be invested back into the club right?

Not the Peter G Angelos law building on Charles St.?

That's the whole point of the Bortz formula - to make teams that own their RSN's pay legitimate rights fees to themselves. MLB cares because of revenue sharing, not out of concern for the fans, but the result is the same.

[Frobby]

This article from Camden Depot does a good job of explaining the dispute and why the Orioles and MASN have a sound arguement.

http://camdendepot.blogspot.com/2014/03/explaining-nationalsmasn-dispute.html?m=1

Although Camden Depot has done a good job following this story, we know a lot more about what the contract actually says, and the underlying arguments, than Camden Depot knew in March 2014 when this article was written. In the media, the Orioles portrayed the contract as though it required application of the "Bortz formula" in black and white, and that was Camden Depot's assumption in this article. In point of fact, the contract is much more vague than that, referencing only the "established methodology" of the RSDC. MASN says the "established methodology" means the Bortz formula (including a 20% profit margin), and the RSDC says it doesn't. As I've said before, it would have been very easy to write a contract that explicitly referred to the Bortz formula and/or a 20% profit margin. I don't know the history of the negotiations, so I can't comment on why that specific language isn't in there, but I suspect that the two sides couldn't agree on more specific language and left it vague on purpose. Once you've done that, you've basically left it up to the arbitrators to decide what it means, and the courts aren't allowed to second guess their interpretation.