The NBA has filed a motion to dismiss the lawsuit brought against it by Warner Bros. Discovery, setting the stage for a high-stakes legal battle over media rights. The lawsuit stems from Warner Bros. Discovery's claim that the NBA breached its contract by rejecting their matching offer for a lucrative new media rights deal. The controversy hinges on the details of a lucrative 11-year media rights agreement the NBA signed, valued at nearly $76 billion, that includes partnerships with Disney, NBC, and Amazon Prime Video. This agreement spans the 2025-26 season through the 2035-36 season.
A Historic Split
The signing of the new contract marks the end of a nearly 40-year relationship between the NBA and Turner, which operates TBS. Following this split, the NBA's legal response included a comprehensive 28-page motion and accompanying documents, aiming for a dismissal of the lawsuit with prejudice.
The Heart of the Dispute
Warner Bros. Discovery accuses the NBA of unfairly rejecting their offer, claiming they had successfully matched Amazon's proposal, which included an upfront payment of approximately $5.4 billion to be held in an escrow account. However, Warner Bros. Discovery suggested using syndicated letters of credit instead of the escrow requirement, making significant amendments to Amazon's original offer. These changes included substantive revisions to eight of Amazon's 27 sections, redefinitions of 11 terms, striking out nearly 300 words, and adding over 270 new ones.
The sequence of events is crucial: the NBA presented Amazon's offer to Warner Bros. Discovery on July 17, and Warner Bros. Discovery responded five days later, claiming they had matched the offer. However, on July 24, the NBA rejected their response, citing multiple discrepancies.
NBA's Stance
The NBA contends that Warner Bros. Discovery's revisions disqualified their attempt to match Amazon's offer. "TBS chose not to match NBCUniversal's offer, which would have enabled TBS to continue distributing games via its TNT linear cable network," the NBA stated. "Instead, TBS purported to match the less-expensive Amazon offer, but only after revising it to include traditional distribution rights and making numerous other substantive changes."
Bill Koenig, president of NBA global content and media distribution, reinforced this argument, stating, "Far from accepting each term of Amazon's offer, TBS's revisions constituted a counteroffer that the NBA was free to reject." Koenig added, "If TBS wanted linear TV distribution rights, it could have matched a separate more expensive third-party offer from NBC, but TBS elected not to do so, attempting instead to save billions of dollars by combining Amazon's lower price with the linear television rights granted to NBC."
Warner Bros. Discovery's Position
On the other side, Warner Bros. Discovery, which has until September 20 to file its response, maintains that their offer complied with the contractual requirements. A spokesman for TNT Sports noted, "Not only is it our contractual right, but it is in the best interest of the fans who want to continue to enjoy our industry-leading NBA content with the choice and flexibility we offer them through our widely distributed platforms including TNT and Max."
Future Broadcasts
The new media rights deal carries significant implications for how fans will consume NBA content in the coming years. Amazon Prime Video is set to broadcast games on Friday nights, select Saturday afternoons, and Thursday night doubleheaders following "Thursday Night Football." Additionally, Amazon's deal includes exclusive coverage of crucial NBA Cup stages and the NBA League Pass package.
As the legal proceedings continue, the sports world will be watching closely, given the profound impact the court's decision could have on the future of NBA media partnerships and distribution. The outcome will not only influence the immediate parties involved but could also set a precedent for future sports media negotiations.
Stay tuned for more updates as this legal saga unfolds.