The Washington Nationals just scored a major win in their long-running battle with the Baltimore Orioles over revenue from Mid-Atlantic Sports Network. Per reports Thursday, a New York Supreme Court judge upheld a Major League Baseball decision that ordered MASN to pay the Nats approximately $100 million in additional rights fees.
The Orioles have maintained a controlling stake in MASN, with Washington a minority partner, since the unusual arrangement regarding the regional sports network was arrived at in 2004, when the franchise formerly known as the Expos was preparing to relocate to Washington. Since then, the two teams have regularly clashed in court over revenue from MASN, with MLB officials getting involved only to be accused by Baltimore of conflicts of interest and bias toward Washington.
On Thursday, Justice Joel M. Cohen rejected a request from the Orioles to overturn a May ruling by a three-member panel of MLB’s revenue sharing committee that the Nationals were owed $296.8 million from MASN. That number reflected approximately $59 million in annual TV rights fees from 2012 through 2016, whereas the network had disbursed $197.5 million, as proposed by the Orioles, for that period.
Cohen also ruled that Washington was entitled to interest, to be determined by a court-appointed officer, on the amount it had not yet received.
The Nationals did not immediately respond to a request for comment.
MASN had been paying the Nationals a set rights fee until 2012, when it came up for renegotiation. When Washington and Baltimore differed sharply on how much the new annual fee should be for a period ending in 2016, they went to baseball’s front office for arbitration.
In a 2014 decision, MLB’s panel said the Nationals were owed approximately $298 million, but the Orioles, acting as managers of MASN, appealed on grounds that the network could not afford such a sum and that the panel could not have been expected to act impartially because Washington used a law firm that had done work previously for MLB.
The Orioles have also contended that, in “a secret deal,” MLB gave the Nationals a $25 million advance in 2013 with the expectation of being repaid after Washington won increased rights fees in court, creating a financial tie between the latter franchise and MLB.
Further irking MASN officials were 2015 remarks by MLB Commissioner Rob Manfred in which he said that “sooner or later, MASN is going to be required to pay those rights fees.” An attorney for the network subsequently sent a letter to New York Supreme Court Justice Lawrence Marks complaining that Manfred’s comments were “highly prejudicial and demonstrate that MASN cannot receive a fair and impartial rehearing of the telecast rights fees dispute in a forum controlled by MLB.”
However, the Nationals continued to argue that baseball’s revenue sharing committee was long established as the agreed-upon arbitrator for such disputes. New York’s Appellate Court agreed in 2017, leading to MLB hearings on rights fees in November 2018 and again in May.
Cohen ruled Thursday (via SportBusiness) that MASN had not met the “heavy burden of showing evident partiality” or “corruption” that would merit overturning the MLB panel’s decision.
Of the reintroduction to the legal dispute of Manfred’s 2015 comments, Cohen stated that his court “does not believe that public statements such as those referenced by the Orioles are sufficient to throw into doubt the fairness” of the revenue sharing committee’s deliberations.
MASN was established to address a situation in which the Nationals were moving into broadcasting territory claimed for over three decades by the Orioles. Baltimore began with a 90 percent stake in the network, one that is set to gradually decline until it is capped at 67 percent.
Jesse Dougherty contributed to this report.
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