DSG drops Rays, Tigers amid bankruptcy reorg

  • Alden Gonzalez, ESPN Staff WriterOct 2, 2024, 12:52 PM ET

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      ESPN baseball reporter. Covered the L.A. Rams for ESPN from 2016 to 2018 and the L.A. Angels for MLB.com from 2012 to 2016.

Diamond Sports Group has submitted a reorganization plan that calls for it to shed broadcasting rights for all but one Major League Baseball team, putting 11 clubs at risk of losing their regional sports network contracts.

Diamond said in court that it will keep its contract with the Atlanta Braves and drop the Tampa Bay Rays and Detroit Tigers. Diamond is prepared to move forward as a business without the other teams in its portfolio: the Los Angeles Angels, Cincinnati Reds, Miami Marlins, St. Louis Cardinals, Kansas City Royals, Milwaukee Brewers, Cleveland Guardians, Minnesota Twins and Texas Rangers.

The Rangers, Guardians Twins and Brewers had their deals expire after the 2024 season. Five other teams — the Angels, Reds, Cardinals, Royals and Marlins — are on joint-venture agreements, which would trigger legal action if Diamond drops its agreements.

A source with Diamond, the bankrupt operator of Bally Sports channels, said the company is still hopeful of agreeing to new terms with the 11 other teams and has previously submitted proposals to each of them.

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MLB, however, has consistently called Diamond’s viability into question and has not shown a willingness to negotiate new rights deals since the company went into Chapter 11 reorganization nearly 19 months ago. A confirmation date has been set for Nov. 14 and 15 in bankruptcy court in Houston. The objection deadline is Nov. 5. MLB lawyer James Bromley said in court that the league was “blindsided” by the development, a point Diamond’s attorney refuted.

“We have no information about what is being done,” Bromley was quoted as saying by The Athletic. “We’ve had no opportunity to review and now we’re in front of the court and being asked to make our comments.”

Diamond secured new contracts consisting of lesser rights fees with the NBA and the NHL on Aug. 23, shortly after agreeing to a new carriage agreement with Comcast, which placed Diamond channels on its most expensive tier. Diamond currently holds the rights to 13 NBA teams and eight NHL teams, having recently dropped the NBA’s Dallas Mavericks and New Orleans Pelicans.

In a statement, a spokesperson for Diamond wrote: “Today marks an important step forward for Diamond with the filing of a baseline plan to enable us to emerge from bankruptcy as a viable, go-forward business before year-end. We have delivered proposals to and remain in discussions with our MLB team partners around go-forward plans. We firmly believe that through our linear and digital offerings we have created the best economic and fan-friendly engine for all of our team partners.”

MLB holds long-term plans to house liner and direct-to-consumer rights under a national umbrella, seeing it as a long-term pivot to a cable model that has become increasingly volatile. Assuming none of the 11 teams in danger of getting dropped by Diamond agree to new deals, MLB — which took over broadcasts for the San Diego Padres and the Arizona Diamondbacks after they were dropped last year — could technically hold the rights to nearly half the league.

With local media making up about 20% of team revenues in the aggregate, Diamond’s plans will create increasingly more financial uncertainty for teams — the type that might once again impact offseason spending.

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