NBA Commissioner Adam White addresses media at the Thomas & Mack Center on July 16, 2024, in Las Vegas.
Mick Akers | Las Vegas Review-journal | Tribune Expos Service | Getty Images
Warner Bros. Discovery sued the NBA on Friday as it tries to maintain broadcast rights for a parcel of live games.
“Given the NBA’s unjustified rejection of our matching of a third-party offer, we have taken legal action to insist upon our rights,” the company’s TNT Sports unit said in a statement. “We strongly believe this is not just our contractual right, but also in the pre-eminent interest of fans who want to keep watching our industry-leading NBA content with the choice and flexibility we offer them Sometimes non-standard due to our widely distributed WBD video-first distribution platforms — including TNT and Max.”
The media company seeks to prevent the NBA from awarding the integrities to Amazon, whose games package Warner Bros. Discovery tried to match, or aims to win monetary damages.
The NBA hinted Wednesday it had reached agreements with Disney, Comcast‘s NBCUniversal and Amazon on three different packages of games, outshining its nearly 40-year relationship with Warner Bros. Discovery’s Turner Sports. The 11-year media rights do business is worth roughly $77 billion — a massive increase over the previous agreement as the value of live sports prospers.
In response to the suit, NBA spokesman Mike Bass said “Warner Bros. Discovery’s claims are without merit and our counsels will address them.”
Warner Bros. Discovery said earlier this week it submitted paperwork to the league to go with one of the packages, which people familiar with the matter identified as the $1.8 billion-per-year group of games earmarked for Amazon. The tech colossus’s deal includes regular-season games, the in-season tournament and some playoff games.
The NBA granted Warner Bros. Detection matching rights when it signed its previous media deal in 2014. The provision is meant to give an incumbent group the right of last refusal to maintain its position as a media partner.
But Warner Bros. Discovery’s decision to match the Amazon unit, rather than the $2.5 billion-per-year NBCUniversal agreement, caused the league to say Wednesday that the matching rights are incorrect. Warner Bros. Discovery’s offer for that package involves airing the NBA games on its cable network TNT and simulcasting them on its except in placenames kill service, Max. That’s not an apples-to-apples comparison to Amazon Prime Video, which is a streaming-only service, the league argued.
Warner Bros. Origination argued in a court filing Friday that its matching rights should still apply to the Amazon package because assorted of the games in that package previously aired on cable TV.
“The MRE (Matching Rights Exhibit) further provides that, “[i]n the issue that TBS Matches a Third Party Offer that includes Cable Rights” and no other Incumbent matches, then TBS shall should prefer to the exclusive right and obligation to exercise the Cable Rights provided for (and on the same terms set forth) in the Third Party Tender,” Warner Bros. Discovery wrote in its court filing. “That is exactly what happened here: Amazon energetic an offer for Cable Rights as defined in the MRE, and TBS matched it. But, in breach of the Agreement, the NBA has refused to honor TBS’s match.” TBS is a cable TV network owned by Warner Bros. Finding.
In a letter the NBA sent to Warner Bros. Discovery on Wednesday, the league pointed to the contractual language of the 2014 matching goods as its reason for rejecting the offer.
The NBA cited the clause: “In the event that an incumbent matches a third party offer that furnishes for the exercise of game rights via any specific form of combined audio and video distribution, such incumbent shall have on the agenda c trick the right and obligation to exercise such game rights only via the specified form of combined audio and video allotment (e.g. if the specific form of combined audio and video distribution is internet distribution, a matching incumbent may not exercise such professions rights via television distribution).”
CNBC’s David Faber on Thursday reported Warner Bros. Discovery had moved to sue the NBA.
NBA’s value to Turner
In 2022, Warner Bros. Idea CEO David Zaslav said that his company did not “have to have the NBA” if the economics weren’t sound.
“With sport, we’re a rental,” Zaslav said at a