NBA seeks to dismiss Warner Bros. Discovery lawsuit

The NBA filed a response to Warner Bros. Discovery’s lawsuit in New York’s Supreme Court on Friday, according to Brian Steinberg of Variety, who reports that the league has sought to dismiss the suit.

Warner Bros. Discovery is the parent company of TNT Sports, the NBA’s longtime broadcast partner which didn’t reach an agreement with the league during the latest round of media rights negotiations, losing out to Disney (ESPN/ABC), NBC, and Amazon Prime Video. TNT sought to exercise its matching rights on Amazon’s offer but was rejected by the NBA.

In documents filed on Friday, the league reiterated its belief that WBD/TNT failed to match the terms of Amazon’s offer. According to Steinberg, the NBA specified several ways in which TNT’s offer differed from Amazon’s, including:

• Amazon’s deal is for distribution via streaming only, whereas WBD’s bid would include games on both the TNT cable network and the Max streaming service.
• Amazon agreed to establish a rights-fee escrow account into which it will “deposit and maintain three seasons of rights-fee payments on a rolling basis and from which rights fees would automatically be disbursed to the NBA on the agreed-upon payment schedule.” WBD, meanwhile, offered to provide the league with letters of credit as an alternative form of security and to only make them available if the company “failed to make a rights fee payment on a timely basis.” In other words, Amazon’s proposal provides more certainty that payments will be made on time, without the risk of delays.
• Amazon has promised to promote NBA games during its widest-reaching sports broadcasts, including "Thursday Night Football" (NFL). WBD “substituted an obligation to promote the NBA in any major sporting league” distributed on TNT or Max — WBD defines “major sporting league” as including NASCAR and various college sporting events, making it a less valuable commitment than Amazon’s in the NBA’s view, Steinberg explains.

As Mike Vorkunov of The Athletic previously outlined, Aug. 23 was the deadline for the NBA to file its initial response to the lawsuit. Warner Bros. Discovery now has until Sept. 20 to file its opposition, then the league will have until Oct. 2 to respond again.

According to Steinberg, the NBA said in Friday’s filing that it intends to move for dismissal at an Oct. 4 hearing in New York City.

Previous reporting has noted that neither the NBA nor WBD likely wants an extended legal battle in which private conversations could be made public during the discovery process, so a settlement of some sort remains a possibility.