MLB Commissioner Bud Selig speaks during a news conference in New York

Fuse lit: MASN goes to court to keep from having to pay the Nats more money for TV rights

78 Comments

Last week the Hollywood Reporter got inside the ongoing Washington Nationals-Baltimore Orioles-MASN dispute over the dividing up of rights fees. The big takeaway there was that everyone was preparing to go nuclear, abandon negotiations and run to the courthouse. And that Bud Selig was warning everyone involved NOT to take this to court because, well, baseball just doesn’t want that. He said in a letter to the clubs that he would level “the most severe sanctions” against them if they do.

Well, get ready to level, Bud, because MASN has gone to court in New York and obtained an injunction against a Major League Baseball arbitration which ruled in favor of the Nationals on the fee dispute. Basically: a court order to prevent the Orioles, the Nationals and MASN from having to comply with it. You can read all of the documents filed and the court order below. The upshot of the arguments, for those who do not wish to read: MASN is asking that the arbitration be set aside due to a conflict of interest. The argument includes the following claims:

  • The same lawyers represented the Nationals, Major League Baseball and the clubs of the three owners who comprised the arbitration panel;
  • “The three arbitrators, MLB and the Commissioner of Baseball, all had a direct and significant pecuniary interest in the outcome of the arbitration.”
  • The authority set up to determine the amount of money the Nats were supposed to get from MASN “exceeded its authority by intentionally refusing to use its established methodology to determine the fair market value of the telecast rights fees as mandated . . .”

Worth noting that there are many levels of conflict of interest here. For all intents and purposes, MASN is the Orioles in this case. The Orioles are the majority shareholders in MASN, they have the same lawyers and, in not paying a lot more money to the Nationals, the same general interests. To the court they are a separate party, to be sure. But I wonder if Bud Selig and Major League Baseball feel obligated to view them that way. Because, either way, the same bad purpose (in MLB’s eyes) is being obtained: the undermining of its arbitration and taking an internal dispute out into the open.

Whether the court is willing or able to untangle all of these many layers of conflict is unclear. It is worth rememberng, however, as we learned in the A-Rod/Biogenesis case, that courts are extremely reluctant to overturn arbitration rulings, so this may all ultimately be an exercise in posturing and delay.

But that’s the legal stuff. The practical aspect of all of this is that, at essence, MASN and the Orioles do not want to pay the Nationals what the Nats and what Major League Baseball, per its arbitration, think their broadcast rights are worth. Or, it should be noted, they may not be able to. You see, per the agreement between the parties, (a) the Nationals are to get market rates for their broadcasts; and (b) the Orioles are to get increases in their payout that match the Nats’ increases. In this market, however, that would probably bankrupt MASN. So no amount of negotiation under the terms of the agreement is likely to solve the problem. It may be an utterly untenable agreement.

So, while this is somewhat amusing from the point of view of baseball’s failed efforts to negotiate a settlement in private between the parties, the parties may now be in an impossible situation. Maybe the court steps in, but it’s hard to see the court wading in to this matter beyond the preliminary way in which it already has. One other possibility is that a third party could step in. As in, the Nats buying their way out of the MASN deal entirely and going out on its own with a separate broadcaster. Which, for their part, MASN and the Orioles probably don’t want, as they make money off of Nats broadcasts and don’t want the competition. But as of now, I see no other way out of it.

For now, though, it’s in the court’s hands. Here are the documents it’s working with right now, including the court order and MASN’s petition to set aside the arbitration ruling:

Order

Petition

Mem

Cardinals, Dexter Fowler agree to a five-year, $82 million deal

CLEVELAND, OH - NOVEMBER 02:  Dexter Fowler #24 of the Chicago Cubs reacts during the seventh inning against the Cleveland Indians in Game Seven of the 2016 World Series at Progressive Field on November 2, 2016 in Cleveland, Ohio.  (Photo by Gregory Shamus/Getty Images)
Getty Images
Leave a comment

The Cardinals have officially signed outfielder Dexter Fowler to a five-year, $82.5 million contract. Fowler will also get a full no-trade clause.

The Cardinals gave Fowler a bigger deal than many speculated he’d get, as some reports predicted he’d get something in the $52-72 million range. His skills, however — he’s a fantastic leadoff hitter who plays a premium defensive position — definitely earned him some major dough. Fowler hit .276/.393/.447 with 13 homers, 48 RBI and 13 steals over 125 games in 2016 for the World Series champion Cubs.

For the Cardinals, this will allow Matt Carpenter to move down to the middle of the batting order and will shift Randal Grichuk to left field. It also takes a prime piece from the Cardinals’ biggest rival. For their part, earlier this offseason the Cubs signed former Cardinal center fielder Jon Jay. So that’s fun.

Are the Cardinals about to go on a free agent binge?

John Mozeliak AP
Associated Press
6 Comments

The Cardinals have always emphasized building from within. In the 2016-17 offseason, however, they may end up being one of the bigger free agent buyers. At least according to some informed speculation.

St. Louis is already in agreement with Dexter Fowler. But Derrick Goold and Ben Frederickson of the St. Louis Post-Dispatch write today that the Cardinals “could become more aggressive than previously believed,” with Mark Trumbo and Edwin Encarnacion as “possible pursuits.” Worth noting that separate reports alleged some interest on the part of the Cards front office in free agent third baseman Justin Turner.

The Cardinals are already losing their first round pick due to the Fowler signing, so any other top free agent won’t cost them more than the money he’s owed. And as far as money goes, the Cardinals have a great deal of it, despite being a small market team. They have a billion dollar TV deal coming online and Matt Holliday and Jaime Garcia are off the payroll now. Spending big on a free agent or three would not cripple them or anything.

Encarnacion or Trumbo would be first baseman, which wold fly in the face of the Cards’ move of Matt Carpenter to first base (and, at least as far as Encarnacion goes, would fly in the face of good defense). Getting either of them would push Carpenter back to second, displacing Kolten Wong, or over to third, displacing Jhonny Peralta. If you’re going to do that, I’d say that Turner would make more sense, but what do I know?

Either way, the Cardinals may be entering a pretty interesting phase of their offseason now. And an unfamiliar one as, quite possibly, the top free agent buyer on the market.