On April 28, Gray Television scored a major “groundbreaking” broadcast TV rights deal with the WNBA and NBA franchises serving the Valley of the Sun. While many heralded the arrival of Phoenix Suns and Phoenix Mercury play-by-play to KTVK-3 and KPHE-44, any on-air broadcasts were dependent on pending litigation.
By 1pm on Wednesday afternoon (5/10), the deal inked between the teams’ owner and Gray TV was effectively voided.
According to Bloomberg, Christopher Lopez, the federal bankruptcy judge overseeing the Chapter 11 restructuring of Diamond Sports Group LLC, iced the deal with Gray, determining that it violated the rights of current rightsholder DSG’s Bally Sports Arizona.
Also negated was a separate web streaming agreement with Kiswe Mobile.
The reason? The agreements violated the bankruptcy injunction protecting DSG, effectively protecting teams from interfering with its existing broadcast rights as it seeks to reemerge from Chapter 11. “You don’t play around with the automatic stay,” Judge Lopez said.
DSG maintained a first right of refusal, and could have matched the Gray deal, or any other offers. What the Suns could do was negotiate with Gray and Kiswe and reach an agreement in principle. The problem, Judge Lopez ruled, was that a binding agreement was signed by Suns with both parties.
Yet, Gray, Kiswe and the Suns protested, arguing that their deal was not a binding agreement and a deal in principle.
Importantly, Judge Lopez’s ruling is against the Suns and not against Gray Television nor against Kiswe.
The bankruptcy is Diamond Sports Group LLC, 23-90116, U.S. Bankruptcy Court for the Southern District of Texas.
