In case you missed it, the paperwork and accusations are flying again in this MASN dispute. Lots of new cross motions being filed between MASN, MLB, and the Nationals over the past few weeks. An already bitter fight between the Lerners and Angelos now has MASN repeatedly attacking MLB and Commissioner Manfred in new filings posted Friday night.
ICYMI: MASN calls MLB's latest move in media rights dispute “improper," cites collusion with Nationals https://t.co/zM2xo9whXb
— Washington Business Journal (@WBJonline) June 10, 2016
Joseph Shenker, who is MLB’s lead attorney, wrote in a May 27th letter to the other attorneys in the case that “absent a judicial order preventing MLB from convening such proceedings, a hearing to determine the Nationals’ and Orioles’ rights fees for the 2012-2016 period will be held” with a new arbitration panel made up of MLB ownership designees known as the RSDC (Revenue Sharing Definitions Committee) with hearings beginning the first week of August 2016.
According to a court-filed copy of the May 27, 2016 memo from MLB Commissioner Rob Manfred informed all teams that he has changed the RSDC from the original panel that heard and ruled on the original arbitration to Brewers owner Mark Attanasio, Mariners President Kevin Mather and Blue Jays President Mark Shapiro.
“As we have stated previously and continue to believe, the most expeditious path for resolving the telecast rights fee dispute between the Nationals and MASN is arbitration before a neutral forum independent of MLB and outside of MLB’s control,” said MASN attorney Thomas Hall in a letter released by the court recently.
With MASN having won a reversal of the original RSDC arbitration award in round 1, they are now fighting to get a neutral arbitration panel not related to MLB to hear Arb 2 while the original MASN contract calls for the RSDC as the only arbitration panel which is comprised of 3 MLB team representatives. What MASN is asking for is a break from the terms of the original contract, and something that the judge has already declared is outside of his authority. The Nationals corrected the possible ‘conflict of interest’ issue with the Proskauer law firm the Nationals were using originally, and has changed to a firm with no conflicts they believe. With no valid legal arguments remaining that the judge has not already thrown out, MASN has resorted to trashing MLB, then claiming bias when MLB responds.
MASN’s latest motion of bias by MLB is based primarily on several comments made by Manfred that the Nationals will eventually be awarded the money as determined by Arb 1; plus the fact that the Nats filed a motion supporting the Arb 2 hearings in August just hours after MLB announced that schedule. MASN has shot back with accusations that they are shocked and appalled that MLB would collude with one of it’s member clubs which is all of course a false front in my opinion considering that the original panel gave the Nats much less than what they had requested and expressly stated that they would not bankrupt MASN, meaning that MLB was effectively siding with Angelos up to the point where he sued them.
Arguing in support of MASN’s motions is the Bortz group, which is the company that created the “Bortz method” for determining rights fees and profit margins as referenced in the original contract. Bortz argues that the Arb 1 panel made an error in their initial determination of fees based on the profit margin being set at 5% rather than 20% as recommended by their methodology. But as the Arb 1 panel determined, if the standard was to be set at 20% that would have been explicitly stated in the contract. An interesting note on the Bortz affidavit is that Bortz makes their money by helping teams maximize their broadcast rights profits, and the Os are their client so this was paid testimony, but meanwhile MLB is also their client as listed on their web site. Another conflict of interest?
MASN makes the argument that the Arb 2 panel should not begin until all appeals are finished for Arb 1, and that the Nats are trying to get “two bites” out of the apple, meaning that if the Nats get more money out of Arb 2 they will drop their appeal for Arb 1 and vice versa. MASN further argues that there is no expediency gained in starting Arb 2 until the Arb 1 appeal is complete because the judge will still need to rule on Arb 1 before any payments are made. Which is false timing, waiting for the resolution of the appeals before starting Arb 2 creates further delays while having Arb 2 done before the judge’s ruling would be the faster path for the Nationals to receive their money.
MASN states that they will appeal the results of all decisions, meaning that there is no reason for anyone to expedite any process. MASN also objects to being given “only” six weeks to prepare for Arb 2, as though the case has somehow dramatically changed since Arb 1.
I’m really ready to hear from the judge on this, having read all of the motions from both sides it is hard to be sure which arguments hold weight. Based on Judge Mark’s previous decision though it seems like the Nats are in a very good position to move forward with Arb 2 and have that ratified since they have complied with the single directive to hire new representation with no conflicts of interest which appears clear at this point. This time around the judge needs to emphatically shut the door on all of these delays and appeals.
“Regrettably, the Commissioner’s statement again makes it clear that MASN cannot receive a fair, objective and impartial hearing before MLB or the RSDC on these matters,” MASN said in a statement responding to comments from Rob Manfred said after the owners meetings recently in New York.
Are these quotes from the MASN side the makings of their next salvo on the Nats and MLB when the next RSDC award is set? How can they say now that they cannot receive a fair, objective and impartial hearing before MLB or the RSDC?
“It is important to bear in mind the fundamentals,” Manfred said. “The fundamentals are that the Orioles agreed that the RSDC would set the rights fees for MASN and the Orioles every five years. The Orioles have engaged in a pattern of conduct designed to avoid that agreement being effectuated.”
The stunning thing about this case is the level of anger in now public attacks between MLB and the Orioles. Manfred’s hands are tied from taking any action while the case is in process, but once it is done it will be interesting to see if there is any action taken against Angelos. Selig strongly warned both teams against going public with this dispute and the O’s called his bluff.
MLB’s Attorney Responded to a Letter from MASN’s Attorney
