CSN Updates Thread

What? This isn't at all true and isn't even in dispute. Crane gave notice that they were walking. It wasn't theoretical or an option - it was happening. As of Sept 30th, the Astros were gone and each party could do whatever they wanted. Two days before it was official, Comcast and the Rockets filed the bankruptcy to prevent that. None of that's even in dispute - the whole reason the involuntary bankruptcy was filed was to prevent the Astros from leaving.

That's pure conjecture on your part - there is no sign that Crane had intended to sue until recently. If he can walk and arrange his own deal, there is a huge incentive to let CSN-H just die and disappear.

The Rockets were fine with the lower carriage rate deals - they could have gone back to FSSW and gotten a deal done, especially since they have Dwight Howard and the demand is higher for them. Maybe it wouldn't be as lucrative for them as the CSN-H one, but there's no question they'd be on TV - remember, it's the Astros that are preventing that from happening due to their own needs. Take them out of the equation and the Rockets would be fine.

 

Actually, you are right on this. My mistake for mistating it. I meant to say until CSN H stopped paying them which was part of CSN H filing for bankruptcy.

It's funny how your opinion is fact and mine is always conjecture. If Crane felt McClane owed him money because he didn't get as much as he was "allegedly" promised then you can't definitively state that Crane would never sue him. He's basically suing for media rights he lost so far and the difference between what he thinks the Network is worth versus what he paid for it.

The suit asks that McLane's McLane Champions corporation be ordered to repay Crane's group for losses that have resulted from alleged breaches of the group's purchase agreement - including, presumably, more than $30 million in rights fees the Astros failed to receive in 2013 and what Crane says is the "artificially inflated price" he paid for McLane's network share. Court testimony indicated CSN Houston was valued in 2010 at $700 million, with McLane's share valued at $326 million.

What's that huge incentive? That's a big IF because until now Crane has a big goose egg for a plan. He has even floated the notion of streaming the games which still amounts to the a-la-carte offering on the table from the other providers. Please elaborate with all the facts you have to back that this big money making offer is just around the corner. The rates are going to be the rates. No one is going to pay the inflated rate that Comcast is paying today.

FSSW has made a public statement that they would take the Rockets back without the Astros and pay them what they were getting before? Please provide that link.

 

Are you really saying that FSSW wouldn't see the value in regaining the market share that comes with carrying the NBA franchise in the fourth largest city in the country?

 

The motion is not to just remove it to federal court, but specifically to the bankruptcy court, as it is related to the CSN bankruptcy case.

 

Guessing Judge Isgur chooses to rule on the Motion to Dismiss first. If he dismisses the bankruptcy, than this motion to move the case is obviusly moot.

Should be some movement one way or hte other soon, I'm guessing.

 

Amen.

 

Of course, the value of the network being lower does not necessarily mean that there isn't a price point at which the network would turn a profit. If I sell you XYZ Corp for $100 million and it is actually worth $50 million, that doesn't mean that XYZ Corp isn't turning a profit. It just means that it isn't turning a profit large enough to justify the valuation I gave you.

Similarly, CSN may be able to turn a profit. That profit will be a lot less than what was represented to Crane to justify the purchase price. If that is true, and Comcast/Drayton knew that at the time, there is common law fraud in the inducement.

 

No kidding.

What they were really saying is that Crane is pissing all over something he is trying to get top dollar for. There's no disputing that.

 

Have you read the Court order? If you had, you would know that Crane's task is to find an alternative business model. One that won't result in the $200 million in losses Comcast's rep testified to at the hearing. There are many, many points in between $200 million in losses and what they were originally seeking.

If I have all the experience and am an industry leader in selling widgets, and I tell you my widget factory will generate profits worth $100 million but it only generates profits worth $50 million, you are still turning a profit, but I have defrauded you out of an extra $50 million.

I do not understand why you (and the Comcast PR guy) can't understand that profit and fraud in the inducement are not mutually exclusive.

 

This last Friday, the Rockets filed a motion asking for an emergency status conference to share with the Court information that was not known at the time of the previous status conference on 11/21. They're asking the Court to set it for the docket early this week. I haven't seen an order yet from the Court.

Also...just read the comcast motion to remove the state court case to bankruptcy court. They say the two cases are related because the state court litigation could affect CSN (the debtor in the bankruptcy) in the following ways:

1. CSN owes indemnity obligations to the Comcast parties that were sued in the state court case in accordance with the limited partnership agreement of CSN. The indemnification provisions of the LP agreement say (according to this pleading) that CSN is to indemnify these Comcast parties in connection with any claims arising out an act or omission performed or omitted on behalf of CSN in connection with claims arising out of performance under a service agreement. That service agreement is an agreement between the Comcast defendants and CSN for the Comcast defendants to provide certain operational services for CSN. So if the Comcast defendants want to raise this indemnification clause, they could attempt to do so in the midst of this case so that CSN would have to indemnify the Comcast defendants for all attorney's fees spent defending themselves and potentially against a judgment. Comcast cites to a lot of case law saying indemnity obligations that affect the property of debtors (in this case, CSN) gives rise to "related to" jurisdiction under the Bankruptcy Code;

--My take...who knows? I'd need to read the indemnification clause to see if it's valid and what exactly CSN is indemnifying them for. The devil is in the details with those clauses.

2. Also they say the case will have a conceivable effect on the value of CSN...that the filing itself is harmful to CSN and litigation will only seek to diminish the value.

--My take...seems like a reach. They cite to one case to support the proposition...but this part of the pleading didn't feel as solid to me as the indemnification component. They make a big deal about pointing out that the Astros are the Lead Negotiator under the agreed order from the previous hearing, but that expires as of December 12, anyway...this is litigation that could drag for years, beyond that.


I still think the Court needs to rule on the Motion to Dismiss first...and Isgur isn't going to do that, in all likelihood, until AFTER the time under the Agreed Order expires...which is December 12, IIRC.

 

yeah but doesn't he have a duty not to drive down the value till these issues are resolved.

 

Can crane say "you're honor my solution was to file suit". I'm being sarcastic but kind of serious

 

Yeah I read it. I know what the task was. I have a difference of opinion, get that in your skull.

It would have been nice if your boy would have told the Judge he was going to sue and make disaparging comments toward his partners at the same time he was telling providers what a sweet company CSN would be to partner with.

We don't have anything but anecdotal comments from Crane to support his suit at this point.

 

Of course he does, but Crane has been all over the place.

 

You have every right to be completely off base.

And no, you didn't read it. If you had, you would know that his task was to find a business model that will work. The judge knows that the current business model won't work. Comcast testified that BOTH (that's right...there were only two) proposed carriage agreements from ONE provider would have resulted in $200 million in losses. Tell me...what leads you to believe that there is a deal out there that will work without a fundamental change in structure? The structure in place is doomed regardless of what Crane says about Comcast. Crane telling industry people that Comcast is less than forthright? Alert the media. I'm sure nobody in the industry already knew that.

The point of the order was to allow Crane to find somebody to buy out one or more of the partners.

 

We haven't seen the projections for the entire deal yet. We have heard of the first ten years. The Rockets were willing to ride it out for a payday at the end. Your boy Crane needs to get back on the porch because it's obvious he can't run with the big dogs. Crane was worried about losing his equity because he would need Comcast to meet his debt obligations in exchange for equity.

Go find someone else to follow around. There are legal minds on both sides of this who have differing opinions but somehow you are guy with all the answers.



"Crane said he will consult “with all the players — Fox, DirecTV, AT&T, Time Warner. I will work to try to get something favorable so that we can move on with or without Comcast in the deal.”

Sure looks like he had more options than just finding someone to buyout a partner. You can go ahead and admit you were wrong there or that Crane is defying a court order.

 

Let's keep in mind the model works for 2 of the 3 partners

 

LOL...whatever. Go back and actually read the order rather than a PR statement by Crane and then post back.