Rocky Relationship Between Sinclair-MLB Unveiled

A simmering dispute between Major League Baseball and Sinclair erupted into public view this week in federal bankruptcy court.

MLB Commissioner Rob Manfred said in court that Sinclair’s executive chairman threatened to force its Diamond Sports Group regional sports networks into bankruptcy, potentially hurting the league, if MLB refused to give it baseball game streaming rights.

Manfred made the accusations against David D. Smith, Sinclair’s executive chairman, while appearing at a bankruptcy hearing in Houston for the struggling Diamond Sports, according to The Baltimore Sun citing reports of the hearing.

Diamond, a Sinclair sports network subsidiary that broadcasts MLB, NBA and NHL games, filed for bankruptcy reorganization in Texas in March, burdened by more than $8 billion in debt and struggling as viewers increasingly stream live sports instead of paying for cable television to view matchups.

Reports said the hearing was scheduled to decide whether Diamond Sports, in bankruptcy, should pay a reduced TV contract value for four of the 14 MLB teams for which Diamond holds broadcast rights or, as MLB has requested, pay the full value or give up rights to the teams. The teams under consideration included the Texas Rangers, the Minnesota Twins, the Cleveland Guardians and the Arizona Diamondbacks, according to The Athletic, a sports news website.

Diamond offered to pay full value if it was given direct streaming rights, a strategy MLB outside counsel James Bromley called “blackmail,” The Athletic reported.

Manfred said during the hearing that Smith had met with him in New York to pursue getting streaming rights for all of Diamond’s MLB teams, The Athletic reported. The broadcaster has been going after streaming rights while it was taking losses on the sports networks it bought in 2019 for $10.6 billion from The Walt Disney Co.