That is exactly my point. Again, nobody has said exactly where these losses come from. Is the network too expensive to run, in its current configuration? Fine, make some cuts, restructure, something. Common sense would dictate that you don't just say 'This is how it is running, this is how much it will cost, there's NOTHING we can do about it for the next ten years!'.. that's just silly. That's why the federal budget analogy is apt, because it's common knowledge that the numbers used are nothing but made-up fantasies, projections which are essentially equivalent to wishes and crossed fingers. So, while I fully understand what you are saying up above, Max, that still doesn't address the questions of exactly what constitutes those losses, and what can be done about lowering those costs, as well as exactly why there were so few offers for their wonderful shiny new network to begin with. I wouldn't keep on about it, except they seem like important points to me.
On this topic, I think it's important to separate out what happened and what is believed can happen. What the judge seems to have said is that the deals that have been proposed aren't workable thus far, but Jim Crane said he could get something done. Therefore, if the party with the biggest problem thinks there's a solution, then there's one out there and thus they need to find it. Am I misinterpreting this? The concern I have with this is that Crane said this early on in the proceedings - and the solution at that point was to give Crane authority to go find that deal because he said he could. But then he couldn't. And then the Rockets also couldn't. So where does that leave us as to whether there really is a viable deal out there?
Valid question. But the difference is that the earlier efforts were not just looking for deals that make CSN viable, but rather deals that could get the Astros concent to resolve this thing outside court. Now, the debtor may look for a deal that can keep it viable and get court approval but over the objection of the Astros
Makes sense - so before, Crane may have been looking for a deal that gets CSN-H to a certain level of profitability, but now the baseline is just making CSN-H viable (ie, not losing money)? Second question - I assume there's no way the bankruptcy court can force any of the partners to put in more money, and that they could reject any future cash calls, correct? If so, where would the money come from to pay the unpaid Astros and Rockets media rights, if the Astros are able to just say "no" cash calls. Could Comcast loan money to CSN-H on its own? It almost seems as though to make it viable now, CSN-H needs to be profitable as opposed to breakeven, in order to pay back all the unpaid stuff it would owe?
I hear ya. Can you explain it better? The judge is literally saying in an order that there's been one offered considered and it was lousy and that the Astros were right to reject it. The only testimony we have is that it would cause the network to bleed money. Then the Astros got a shot and the Rockets got a shot to find better deals...neither could. That's all the information we're working with at this point. You can potentially restructure the business in such a way that those offers don't look so bad or don't have the same effect on the newly reorganized business that they would have on the old structure...bankruptcy affords that possibility. Purely from a fan's perspective, I'm hopeful we're not talking about just finding viability for this albatross. I'm hoping for a structure for the franchise that is somewhere remotely in the vicinity of bringing about the same level of revenues that other teams in the division are finding...including the Seattle Mariners. From what I read, I have a difficult time understanding what's there that's worth preserving via reorganization. But I'm not in the courtroom and I'm not privy to all the evidence presented.
1. Well, sort of. Basically, after a reorganization (or an asset sale), a new entity with a different set of shareholders/partners will be running the CSN-H business. So the new entity just has to be as profitable (or unprofitable) as these new shareholders/partners/management wish it to be. I would assume that these shareholders/partners/management would not want to run the channel into the ground. As far as the bankruptcy court is concerned, it would care about the viability of this new entity for one reason and under one scenario: If instead of just paying the debtors' creditors (or equity holders, if they are entitled to anything) whatever they are due under the Bankruptcy Code in one shot, this new entity is supposed to make a stream of payments to these creditors over a number of years, then the bankruptcy court would need to make sure that this entity is actually capable of making these payments. 2. I don't think there is actually a contractual obligation on the part of the partners to make further capital contributions. It seems that the management can call for it but the partners can (and the Rockets did) reject the call. If there was such an contractual obligation, I remember reading some cases saying that it can be enforced. I just don't know that in this case that there is such a contractual obligation to begin with. 3. You are right that somebody will likely need to put in some new money (in the form of a loan, or a purchase of the business, purchase of equity in the reorganized new entity, etc.) to fund the reorganization (including payment of the rights fees currently owed and operating expense going forward). This could be some combination of Comcast, Rockets, some new investor, or even the Astros.
Compromise on what? There was ONE deal presented. It was the deal the judge said was a rotten business deal. You either take that one deal or you don't. There isn't a compromise to be had there. It is this kind of dumbass statement that has people calling you out in droves now.
The entire,point of an appeal is the argument that the judge got it wrong. I don't know what the legal argument will be on appeal, or the success of those arguments, but bankruptcy judges are overturned on appeal frequently.
You either call Crane the devil, or Granville will call you an idiot It wouldn't be easy I know, but this thread/board would be much better if everyone would quit commenting on his posts...I'm guilty of that myself, but never again
Not that it matters now, but I wonder how the media rights of the AL West teams compares to the NL Central teams? Could the Astros have competed money-wise had they not be forced to move west?
It's hard to predict the outcome of an appeal when the briefs are not even written yet. Hell, it's not possible to predict with certainty even after reading all the briefs and evidence unless you know that there is controlling authority in each legal point with facts parallel to this case. That said, if I were to place a bet, I'd say odds are not in favor of a successful appeal. Bankruptcy court decisions can and do get overturned, but judges don't like to see their decisions reversed and make an effort to make sure that they make the right decision-- or at least a decision that is unlikely to get reversed. So unless the judge is an idiot, the odds for reversal should be well below 50/50. Granville, I don't get why you are attacking all these people in this discussion. First, the whole prediction business is a bit silly. I don't know if anyone is saying that they know for sure what would happen. Most people are just saying that they see merits in certain legal arguments (like whether certain Comcast creditor' claims are subject to bona fide dispute) but know enough to also say that our analysis cannot be complete since we didn't read every single brief, attend every hearing and deposition and conduct independent legal research on every legal point. Second, just because a side loses the legal argument, it doesn't mean that this side is being unreasonable or frivolous in litigating over it. Folks are entitled to advocate for their business interest and on many legal arguments there are no controlling authority directly on point. So, the court must interpret the Bankrutocy Code and case law from other circuit or involve similar, but not exactly parallel situations. Crane may well be an annoying idiot but I don't know that what he did in this case is out of line in terms of typical litigant behavior.
Exactly.... There was one deal and for the Network to be successful it woukd several deals to be profitable so extrapolating losses out to 200m without the possibility of other deals would be rotten. Obviously the judge thinks there are other providers who want the product and will pay something for it. The judge made the comments about Crane wanting the Network to fail because he knows Crane doesn't want to compromise he just wants to walk. Well in light of the judges harsh comments and we reflect upon a guy who does this for a living. And that guy runs around constantly making statements that imply that Crane didn't have to look out for the best interest of the Network, that guy should refrain from making derogatory statements about comments others make Look around there are more and more people wanting Crane to come to his senses and they should Crane just got smashed in court.
So now you have reverted back to making up deals with other providers that do not exist. Dish Network a few months ago said they were not interested in CSN Houston at any price. Would they eventually back off of that position? Maybe. But you cannot simply assume that all providers would just buy the channel. Judge Isgur can see that and made his comment about the quality of the deal presented based on what was out there, not on what may be if we wished really hard. The harsh words in court were also directed at Comcast. The judge rebuked Comcast for bringing rotten deals to the other partners. You constantly talk of Crane's duty to look out for the best interests of CSN, but ignore his duty to look out for the best interests of his investors and Comcast's duty to look out for the best interests of CSN. They bring one low ball, rotten offer to the partners. That deal would have reduced by almost half what Comcast would have to pay. How on Earth is that not self dealing? Yet somehow this is all Crane's fault? Get real.
The odds are never in favor of a successful appeal. However, as you noted, bankruptcy courts do get overturned. Without appeals from bankruptcy courts, we would not have landmark cases like Till to use as a go by in prosecuting future cases. I obviously have no idea what will happen on appeal, as I said previously. However, Granville could not be more wrong when saying that an appeal is just a waste of time with darned near orgasmic glee based on the comments of the judge being appealed.
Yes. Just because your probability for success is, say, only 30% or 35%, it doesn't mean that you are wasting your time. If this were true, a lot of baseball batters shouldn't bother going up to bat and many NBA players shouldn't bother attempting 3 point shots. Nothing wrong with a litigant who honestly believes that that the trial court may have erred to seek an appellate opinion-- as long as there is a non-frivolous argument to be made and the litigant is willing to pay his lawyers for the work. If the argument was truly frivolous and made in bad faith, the courts can sanction a litigant, but we are not really close to being in this territory here.
