Major League Baseball has filed a motion in the ongoing Diamond Sports Bankruptcy proceedings, reports Daniel Kaplan of the Athletic. The league is seeking payments on behalf of the Twins and Guardians.
According to MLB’s motion, a pair of the Diamond-operated regional sports networks — Bally Sports North (Minnesota) and Bally Sports Great Lakes (Cleveland) — informed those clubs they would not meet their April 1 installment under their local broadcasting deals. Those networks have continued to broadcast Twins and Guardians games, respectively, in the past few days. MLB is seeking a court order demanding payment to those two organizations by April 13, or alternatively, requesting the court terminate those contracts so the league could assume broadcasting rights for those clubs.
Diamond’s Bally Sports RSNs have broadcasting contracts with 14 MLB teams.* According to Kaplan, they’ve met their payments to 11 clubs. Minnesota, Cleveland and the Diamondbacks are the exceptions. The missed payment to the Arizona organization came before Diamond officially filed for Chapter 11 bankruptcy on March 14. As a result, the D-Backs are among the creditors seeking relief for pre-bankruptcy default. That was automatically paused once Diamond filed for bankruptcy, as the court proceedings will dictate how and to what extent its various creditors (which extend beyond MLB teams) can receive relief. That doesn’t apply to the Twins or Guardians, who are seeking relief for an alleged contractual breach that took place after the Chapter 11 filing.
With speculation about Diamond’s financial viability mounting for months, MLB has maintained it is in position to take over local broadcasts if necessary. Commissioner Rob Manfred has indicated on multiple occasions the league’s preferred outcome is for the Bally RSNs to honor all their existing commitments. That clearly isn’t going to happen with every team, though, which could necessitate MLB finding an alternative way to broadcast in-market games for clubs whose deals feel through.
According to Kaplan, MLB’s motion indicates they’re prepared to do that. Whether they’ll receive approval from the bankruptcy court — or if there’s a seemingly unlikely situation in which Diamond buys itself more time by making up its missed payments to the Twins and Guardians by next week — remains to be seen. Kaplan reports the Guardians’ broadcasting deal calls for $55MM in yearly rights fees, while the Twins’ agreement is supposed to pay them $42MM annually.
*The Angels, Braves, Brewers, Cardinals, Diamondbacks, Guardians, Marlins, Padres, Rangers, Rays, Reds, Royals, Tigers, and Twins are all broadcast by Bally.