New York's highest court ruled for the Washington Nationals on Tuesday in a long-running dispute with the Baltimore Orioles over television rights fees, a disagreement that has complicated a potential sale of the Nationals.
The Orioles control the Mid-Atlantic Sports Network, a two-team regional sports network. Last decade, an arbitration committee of baseball executives appointed by the Major League Baseball commissioner said the value for the Nationals should be set at $297 million for 2012 through 2016.
Baltimore argued the process was tainted and should be decided by a different forum, but the New York Court of Appeals affirmed lower state court rulings in Tuesday's 6-0 decision.
“The parties agreed to an industry insider-controlled process with a full understanding of the commissioner’s involvement,” according to the decision, which was written by Judge Madeline Singas. “MASN and the Orioles cannot now complain that they received something different than what they bargained for through the insider process they selected.”
A spokeswoman for the Nationals did not immediately respond to requests for comment, and the Orioles did not provide an immediate comment.
The dispute originates from MLB's purchase of the Montreal Expos and moving the club to Washington in 2005. The Orioles contended the Nationals’ presence in their TV market would harm them financially. So, MLB and the two teams negotiated an agreement under which MASN would televise both teams' games.
Unable to agree on telecast rights fees, that dispute went to arbitration before an MLB committee.
An 2014 arbitration panel decision said the Nationals were owed $298 million, but it was thrown out by a New York trial judge, who ruled that a law firm representing the Nationals was conflicted because it had worked for clubs of executives on the panel. A second panel of baseball executives ordered a slightly lower payment of $297 million, but the Orioles said the process remained tainted.
While confirming the value of the TV rights, the top court said Tuesday that the parties would have to resolve a disagreement about the nonpayment of those fees through a different provision of their settlement agreement.
“While it is unfortunate that our decision may send this protracted litigation into extra innings, that result is necessitated by the settlement agreement’s terms,” Singas wrote.
The Lerner family bought the franchise from MLB for $450 million in 2006 and began exploring a possible sale in April 2022, with the price expected to top $2 billion. The ongoing dispute — and the inability of the Nationals to fully profit from their local TV rights — has made it tougher for the current owners to complete a sale of the club.
“Look, you would think I was not too bright if I said uncertainty as to your media space doesn’t affect the sale," MLB Commissioner Rob Manfred said Monday at an availability with sports editors from around the country. “So I’m going to say, yeah, it’s an issue, the uncertainty there.”
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AP Assistant Sports Editor Jake Seiner in New York contributed to this report.
