SBD/March 1, 2013/Media

Federal Jury Finds ESPN Liable In Dish Network Lawsuit On Just One Of Four Charges

A federal jury on Thursday found ESPN "liable for only one breach-of-contract claim" out of the four made by Dish Network and awarded the satellite TV provider $4.86M, a "mere fraction of the more than $152 million it had sought," according to Raymond & Baker of REUTERS. The 10-member jury in Manhattan in a unanimous vote found ESPN liable for "breaching a 2005 licensing agreement by allowing rivals to pay lower rates for ESPN Deportes, a Spanish language channel, without extending the same offer to Dish." But the jury "rejected most of Dish's central claims that ESPN ... had breached its contract by giving better deals to rival distributors." The lawsuit "centered on the terms of distribution agreements that ESPN had negotiated with Dish and its competitors for channels that included ESPN Classic ... and ESPN Deportes." The trial "may have an impact on future negotiations between the two companies, whose distribution agreement is to expire this year" (REUTERS, 2/28). The HOLLYWOOD REPORTER's Eriq Gardner noted the trial "was marked by intense detail of contracts that typically are closely guarded secrets." Dish also "showcased internal ESPN emails that calculated how licensing negotiations with other MVPDs impacted the money that was owed to Dish and how to 'finesse' the obligations for financial advantage" (HOLLYWOODREPORTER.com, 2/28).

IT'S NOT PERSONAL: On Long Island, Neil Best writes ESPN, when it matched NBC's offer last week for Big East TV rights, was "merely ... doing what made business sense." ESPN played "defense against a competitor while holding on to another sliver of the most valuable programming in television: live sports." The "lack of supply has run into a mushrooming demand for hours to fill," which has created "increasingly desperate high-stakes bidding for sports rights -- both nationally and even more so locally." ESPN is in an "enviable position, having locked up rights to a lot of major stuff for years." ESPN President John Skipper said, "What we have to do, of course, is build upon that, start new businesses, make sure our mobile works, grow in Latin America, so that we continue to have the money it will take to buy that marquee product" (NEWSDAY, 3/1).
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