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Warner Bros. Discovery has filed a lawsuit against the NBA as it seeks to secure the broadcasting rights for a package of live games, challenging the league’s decision to award these rights to Amazon.
“Due to the NBA’s unjustified rejection of our match against a third-party offer, we have initiated legal proceedings to enforce our rights,” stated TNT Sports, a unit of Warner Bros. Discovery. “We strongly believe this is not only our contractual right but also best serves fans who prefer our flexible and widely accessible platforms, including TNT and Max.”
The media company aims to prevent the NBA from finalizing its deal with Amazon or seek monetary compensation for the breach.
Earlier this week, the NBA announced agreements with Disney, ComcastNBCUniversal, and Amazon for three separate game packages, concluding its near 40-year partnership with Warner Bros. Discovery’s Turner Sports. This new 11-year media rights deal is valued at approximately $77 billion, reflecting the escalating value of live sports content.
Responding to the lawsuit, NBA spokesperson Mike Bass said, “Warner Bros. Discovery’s claims lack merit, and our legal team will address them accordingly.”
Warner Bros. Discovery had submitted paperwork to match Amazon’s $1.8 billion-a-year package, which includes regular-season games, an in-season tournament, and certain playoff games. However, the NBA invalidated the matching rights, arguing that Warner Bros. Discovery’s bid did not meet the criteria since it involved both cable and streaming distribution, unlike Amazon’s streaming-only service.
Warner Bros. Discovery contends that its matching rights should apply because many games in Amazon’s proposed package have historically aired on cable TV.
“The Matching Rights Exhibit (MRE) stipulates that if TBS matches an offer that includes cable rights, TBS will have the exclusive right to exercise those cable rights under the same terms,” the company argued in its court filing. “Amazon’s bid included cable rights as per the MRE, and TBS matched it. However, the NBA refused to honor this agreement.”
The NBA referenced a clause in the 2014 rights deal, stating that incumbents matching a third-party offer must adhere to the specified form of distribution, such as internet-only streaming.
The lawsuit underscores the significance of NBA rights to Warner Bros. Discovery’s Turner Sports division. Despite CEO David Zaslav’s 2022 comments questioning the value of sports rights in a weaker economy, the company acknowledges that NBA games are crucial for viewership, advertising revenue, and maintaining a competitive edge.
“NBA games attract substantial viewership and ratings, driving higher advertising and distribution fees,” Warner Bros. Discovery stated. “The NBA distribution rights are vital for brand growth and reaching a broader audience, offering a competitive advantage in negotiations with other sports leagues.”
Warner Bros. Discovery seeks preliminary and permanent injunctive relief to prevent the NBA from licensing these rights to Amazon, or alternatively, monetary damages if equitable relief is not granted.
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