Struggling CSN Houston Files For Chapter 11 Bankruptcy Protection
Three units of Comcast/NBC Universal and a fourth TV-related company "filed an involuntary Chapter 11 petition Friday against CSN Houston," the RSN that carries Astros, Rockets and MLS Dynamo games, according to David Barron of the HOUSTON CHRONICLE. NBC Universal in a statement said the action was “necessary to preserve CSN Houston’s ability” to remain in business. The Astros in a statement said that the Chapter 11 filing was "improper but also acknowledged that CSN Houston has not paid broadcast rights fees" to the team for the last three months. CSN Houston's creditors on Saturday "asked U.S. Bankruptcy Judge Marvin Isgur to appoint an interim trustee to oversee network operations while the bankruptcy petition winds its way through court." Comcast in one document filed Saturday said that if the bankruptcy court "sees fit, it would be willing to buy the entire network and continue in business under the CSN Houston name." Barron reported the Astros currently own about 46% of the network, the Rockets own about 31% and Comcast/NBC Universal owns 22%. Saturday’s filings "provide more thorough detail into the ongoing disputes over critical issues, including the inability to reach affiliation agreements with such carriers as DirecTV, Dish Network and AT&T U-verse." Another section of the petition "refers to disputes that have created 'total gridlock' for the network." CSN Houston has a four-member board -- one rep each from the Rockets and Astros and two from Comcast/NBC Universal -- and all parties "must agree for deals such as carriage agreements to be reached." The primary creditor "seeking to force bankruptcy is Houston SportsNet Finance, a unit of Comcast that provided" a $100M loan to "ramp up the network’s launch last Oct. 1 and to fund construction of the network’s studios in downtown Houston" (CHRON.com, 9/28).
WHAT CREDITORS ARE OWED: MULTICHANNEL NEWS' Mike Reynolds reported that in addition to Houston SportsNet Finance, creditors include National Digital Television Center (owed $10,517.50), Comcast Management Services ($1.25M) and CSN California ($43,129.02). CSN Houston, which is "reportedly seeking a $3.40 monthly subscriber fee, has only been able to secure carriage with Comcast and a number of smaller distributors" (MULTICHANNEL.com, 9/28).