In a dramatic turn of events, the NBA has filed a motion to dismiss the lawsuit initiated by Warner Bros. Discovery, which alleged a breach of contract over a new media rights deal. The heart of the conflict revolves around the NBA’s refusal to accept Warner Bros. Discovery's matching offer for the deal.
An 11-Year, $76 Billion Deal
The NBA recently secured an 11-year media rights contract worth nearly $76 billion. This lucrative deal includes partnerships with Disney, NBC, and Amazon Prime Video and spans from the 2025-26 season through the 2035-36 season, subsequently ending a close to 40-year relationship with Turner.
The league's legal team has submitted a 28-page motion along with supporting documents to back their claim. They are seeking dismissal of the lawsuit with prejudice, which, if granted, would prevent Warner Bros. Discovery from refiling the case in the future.
Warner Bros. Discovery's Counter-Argument
Warner Bros. Discovery contends that it matched Amazon's offer for the media rights, but the NBA has pointed out significant discrepancies. According to the NBA, Warner Bros. Discovery altered substantial portions of Amazon's proposal, making substantive revisions to eight of 27 sections, redefining 11 terms, striking out nearly 300 words, and adding over 270 new words.
"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, referring to Warner Bros. Discovery's TBS network. "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."
This key point underscores the NBA’s position that, "Far from accepting each term of Amazon's offer, TBS's revisions constituted a counteroffer that the NBA was free to reject."
The Financial Terms in Question
Another bone of contention lies in the financial arrangements proposed by Amazon and Warner Bros. Discovery. Amazon's offer included an upfront payment of approximately $5.4 billion to be held in an escrow account. Contrary to this, Warner Bros. Discovery suggested using syndicated letters of credit instead of escrow, a change that didn't sit well with the NBA.
The NBA presented Amazon's offer to Warner Bros. Discovery on July 17, and the latter responded five days later, claiming a successful match. However, by July 24, the NBA rejected Warner Bros. Discovery’s response, citing multiple discrepancies in the matching attempt.
Bill Koenig, President of NBA Global Content and Media Distribution, reinforced the NBA's stance, stating, "The response made by TBS does not qualify as a match."
Implications for NBA Broadcasting
The new media rights deal ensures that Amazon Prime Video will broadcast NBA games on Friday nights, select Saturday afternoons, and Thursday night doubleheaders following "Thursday Night Football." Amazon’s agreement also includes exclusive coverage of critical NBA Cup stages and the NBA League Pass package, bringing significant changes to how NBA content is consumed.
On the other hand, Warner Bros. Discovery, which operates TNT Sports, believes that maintaining its NBA content is crucial for their audience. "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," stated a representative from TNT Sports.
What's Next?
Warner Bros. Discovery has until September 20 to file its response to the NBA's motion. As the courtroom drama unfolds, the battle over NBA's media rights remains a high-stakes game, with billions of dollars and broadcasting futures on the line. Fans and industry insiders alike will be watching closely as both sides prepare for the next phase of this legal showdown.