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Lawyers for the bankrupt Los Angeles Dodgers have sued Fox Sports, alleging that the broadcaster is interfering with its plans to sell the baseball team. On Nov. 16, lawyers for the Dodgers filed a complaint in U.S. Bankruptcy Court in Delaware seeking damages and an injunction that would prevent Fox Sports Net West 2 LLC, which operates the Prime Ticket television network, from ruining its plans to sell the team’s future broadcast rights through a planned auction. Fox, which holds a contract to broadcast Dodgers’ games, has raised concerns about a Nov. 2 deal between Major League Baseball and owner Frank McCourt to sell the team, including its future broadcast rights. The contract expires at the end of the 2013 baseball season but gives Fox the right to negotiate exclusively with the Dodgers from Oct. 15, 2012, through Nov. 30, 2012, for an extension. According to the Dodgers’ complaint, Fox’s outside litigation counsel, Richard Stone, a partner in the Los Angeles office of Jenner & Block, sent a cease-and-desist letter on Nov. 9 to the financial advisers handling the auction on the team’s behalf. The letter demanded that they stop telling potential bidders that the team “is in a position to negotiate a sale of the future media rights for the Dodgers.” Wrote Dodgers lead bankruptcy attorney Robert Brady: “The issuance of the Fox Letter was intended to interfere with the sale of the Dodgers and their assets in bankruptcy.” He is a partner at Young, Conaway, Stargatt & Taylor in Wilmington, Del. The Dodgers issued a public statement, saying: “We have requested the bankruptcy court to put a stop to Fox’s improper attempts to interfere with the sale of the team and its assets.” Stone declined to comment. Fox spokesman Chris Bellitti issued a statement: “This is just the latest chapter in the current owner’s ongoing scheme to avoid honoring his contractual obligations. The full truth of this unfortunate situation will soon become apparent to all.” On Nov. 12, after reaching the agreement with the league, the team amended its Chapter 11 reorganization plan, asking U.S. Bankruptcy Judge Kevin Gross to authorize the auction of its broadcast rights for the 2014 baseball season and beyond. Doing so would expedite Fox’s exclusive negotiation period under its contract and assist in demonstrating the actual value of the rights, “which constitutes a large share of the Team’s overall value,” according to the motion. The Dodgers cited objections raised by Fox to the sale of the broadcast rights. Before the agreement between McCourt and the league, Fox had sued the Dodgers to halt a reorganization plan that would have provided cash through the sale of the team’s rights. The Dodgers have filed a motion to dismiss that case. “Since the MLB Agreement was announced, Fox has publicly stated that it is supportive of a change in ownership of the Team, but has maintained its staunch refusal to engage in any meaningful discussions with the Debtors,” wrote Donald Bowman, an attorney at Young Conaway. “In fact, Fox has only intensified its efforts to block any attempt by [the Los Angeles Dodgers] to market the Telecast Rights.” Fox Sports, meanwhile, asked on Nov. 16 for a postponement of a Nov. 30 hearing on the revised plans to auction the broadcast rights until more details about the agreement are made public. Fox Sports attorney Andrew Remming of Morris, Nichols, Arsht & Tunnell in Wilmington wrote that the recent agreement, made in secret, had not been filed with the court and looked like an effort by McCourt to “put value rightfully belonging to Prime Ticket in his own pocket.” “The theme of accelerated disposition of Prime Ticket’s valuable rights without full and fair notice has been, and now continues to be, advanced to further McCourt’s obvious personal priorities, and utterly lacks a corresponding benefit to creditors,” he wrote. Given such conduct, Remming added, “substantial litigation is inevitable.” He said that Fox would move to dismiss the bankruptcy case altogether before the end of November. Citing the entanglements with Fox, the Dodgers’ unsecured creditors’ committee raised concerns on Nov. 15 about the proposed timing for the auction. The committee emphasized that the sale should be complete in time for the Dodgers’ opening game on April 5 against the San Diego Padres. “In order to accomplish this goal, the Committee intends to press the parties to move forward with the necessary sales process,” wrote Kevin Capuzzi, an attorney at Pinckney, Harris & Weidinger, the committee’s counsel in Wilmington. “The Committee sincerely hopes that Fox’s opposition to the sale of the telecast rights can be resolved and the Debtors can move forward with a fully consensual plan of reorganization.” In a separate development, the Dodgers’ bankruptcy lawyers have requested more than $2.9 million in legal fees and costs for October. Young Conaway and Dewey & LeBoeuf of New York had requested more than $3.7 million in fees and expenses from the June 27 filing of the bankruptcy through Sept. 30. Gross is expected to address the firms’ compensation requests for the first three months during the Nov. 30 hearing. Contact Amanda Bronstad at [email protected].

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