MLB panel cuts value of Nats’ TV rights in dispute with O’s
A Major League Baseball panel hearing the long-running dispute between the Nationals and Baltimore Orioles over money from the cable channel they jointly own said Washington should receive $296.8 million from the Mid-Atlantic Sports Network for its television rights for 2012-16.
That is down from $298.1 million under a 2014 decision later thrown out by a New York court, but the Orioles are still trying to get the new decision vacated, too. They claim a different arbitration forum should handle the dispute and the amount should be lower. If the latest decision is upheld, Baltimore would owe the Nationals tens of millions of dollars.
The 48-page decision by MLB’s Revenue Sharing Definitions Committee was issued April 15 and unsealed Tuesday in New York Supreme Court. Washington filed a motion last month for the court to confirm the arbitration decision. The Orioles are contesting that motion, saying it should be put on hold until the New York Court of Appeals decides on Baltimore’s attempt to throw out a lower court decision authorizing the RSDC to rehear the case.
MASN was established in March 2005 after the Montreal Expos relocated to Washington and became the Nationals, moving into what had been Baltimore’s exclusive broadcast territory since 1972.
The Orioles were given a supermajority partnership interest in MASN, starting at 90%, and Washington made a $75 million payment to the network for an initial 10% stake.
The agreement between the clubs set network’s rights payments to each team at $20 million apiece in 2005 and 2006, rising to $25 million in 2007, with $1 million annual increases through 2011. The deal called for the Nationals’ equity to increase 1% annually, starting after the 2009 season, with a cap of 33%.
The agreement said any dispute should be decided by the RSDC, which includes three executives from other clubs.
MASN paid the Nationals for 2012-16 what the Orioles proposed: $197.5 million, an average of $39.5 million. Washington argued it should be paid $475 million, an average of $95 million.
An RSDC panel that included Pittsburgh Pirates President Frank Coonelly, Tampa Bay Rays principal owner Stuart Sternberg and New York Mets chief operating officer Jeff Wilpon heard arguments in April 2012 issued its decision in June 2014.
The Orioles sued, and the RSDC decision was thrown out in 2015 by a New York Supreme Court justice, who ruled a law firm representing the Nationals was conflicted because it has worked for clubs of executives on the panel.
The New York State Supreme Court Appellate Division in 2017 coted 3-2 to send the decision back to the RSDC, which reheard the case last November with a reconstituted panel that included Milwaukee Brewers chairman Mark Attanasio, Seattle Mariners President Kevin Mather and Toronto Blue Jays President Mark Shapiro. The Orioles argue this decision also should be thrown out.
The new RSDC decision ruled against the Nationals’ request for interest on the money they are owed prior to the decision. An additional amount Washington ultimately is due for rights would be adjusted downward when MASN recalculates profit distributions already made to the Nationals for those years.
Separately, a New York judge decided last month that the American Arbitration Association should rule whether Commissioner Rob Manfred can decide the Nationals’ claim that MASN failed to distribute profits to Washington last year.