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Dodgers, TWC could take legal action over SportsNet LA

SportsTelevision IndustryDirecTV Group Inc.Antitrust IssuesSatellite TechnologySatellite and Cable ServiceEric Garcetti
Dodgers have fought battle over a new network before
Refusal to carry SportsNet LA could result in legal action
Cable and satellite operators don't want to pick up TWC's costly Dodgers network

This is not the first time the Dodgers moved to a new cable television channel that most of their fans could not see.

The Dodgers have been virtually invisible to much of Southern California this season. The SportsNet LA blackout hit its most infuriating level last Sunday, when fans could hear that Josh Beckett was closing in on a no-hitter but could not see it.

The channel now known as Prime Ticket launched in 1997, with the Dodgers as the featured attraction but with cable companies declining to sign up. Fox Sports challenged that blackout in court.

As the SportsNet LA impasse extends into a fourth month, the Dodgers and Time Warner Cable are considering whether legal action might help get the team on the air. Dodgers President Stan Kasten, who was trained as an antitrust lawyer, and TWC spokeswoman Maureen Huff each declined comment for this column.

At issue: Are all the cable and satellite operators saying no to SportsNet LA acting independently or collectively?

The latter would be a violation of antitrust law. That is what Fox alleged in its 1997 suit, arguing that a "plainly anticompetitive boycott" triggered by "concerted activity" among cable operators could be the only reason for the widespread rejection of Prime Ticket, "particularly given its popular scheduled Dodgers telecasts."

The response from the defendants: "This 'conspiracy' allegation … is nothing more than an effort by Fox to blame everyone but itself for the unattractiveness of its new and costly product."

That, Dodgers fans, is exactly where we are today. Just substitute "Time Warner Cable" for "Fox" in the last paragraph, then put the word "costly" in bold face, and you have precisely what DirecTV would say about SportsNet LA.

TWC says its asking price for SportsNet LA is fair. DirecTV and other carriers say it isn't. No one releases actual dollar figures, so the comparable situations each side can cite amount to little more than rhetoric.

However, when TWC launched its Lakers channel two years ago, the counter-arguments were the same as they are now: too much money, too many sports channels, too high a bill for customers.

Within two weeks of the start of the Lakers' season, all cable and satellite providers had signed on (with the exception of Dish, which still does not carry the Lakers channel). The smaller carriers signed up first, followed by DirecTV.

This time, no major provider has signed on, and so DirecTV is not at risk of losing subscribers to anyone except TWC.

In an antitrust suit, TWC would get laughed out of court if the only evidence was that no one is carrying the channel, said Daniel Lazaroff, professor of sports law and antitrust law at Loyola Law School.

"If people are refusing to deal with Time Warner unilaterally, making their own business decisions," Lazaroff said, "I don't see a problem with that."

What TWC would need, he said, is some evidence that the carriers had agreed to draw a line in the sand against SportsNet LA.

DirecTV Chief Executive Mike White, discussing options for dealing with rising programming costs, said this on May 15, at an industry conference in New York: "… the distributors start to stand together, like most of us have been doing in Los Angeles for the first time ever, by the way, with the Dodgers on outrageous increases and excesses."

Cox spokesman Todd Smith said his company has no agreement with DirecTV, or anyone else, on a joint negotiating stance regarding SportsNet LA.

"We can't do that," Smith said. "We don't have direct conversations with the other guys on issues like this."

DirecTV spokesman Robert Mercer said White was referring to the greater context of other sports channels that are not on the air, and not just in the Los Angeles market.

"It seems that many of the distributors have independently reached the same conclusion," Mercer said. "With all the top college conferences and individual teams creating their own overpriced channels, many families can no longer bear the cost of having to pay for every single one."

Still, the 'stand together' part of White's comment could be useful to TWC, Lazaroff said.

"Do I think it's relevant? Yes," Lazaroff said. "Do I think it's enough? No."

Here's the catch-22: A court probably would throw out an antitrust suit without some reasonable evidence, yet the court would have to let the suit proceed in order for TWC to get the legal authorization to pursue such evidence. It's not as if DirecTV would make White available to TWC attorneys just to be nice.

That, Lazaroff suggests, is why TWC might be better off trying to interest the Dept. of Justice or state attorney general — each of which has subpoena power — into looking into the matter.

James Hornstein, the co-counsel for Fox in that 1997 suit, said antitrust suits are expensive to fight and difficult to win, and they can take years to resolve. The Fox suit was settled, and it is possible that settlement talks could provide leverage to get SportsNet LA on the air.

But Hornstein said he thought political pressure might be more effective, particularly given that the SportsNet LA deal removed almost all Dodgers games from free, over-the-air television.

On Friday, representatives for TWC and DirecTV assured Los Angeles Mayor Eric Garcetti that the two sides still were in negotiations, according to Jeff Millman, a spokesman for Garcetti.

Let's hope they really are talking, and they're not just trying to pacify the mayor. Legal or political intervention almost assuredly would extend the blackout through this season. In any case, if the Dodgers and TWC wanted to get the guy Lazaroff said is the best antitrust lawyer in town, they would have to wait.

He was co-counsel with Hornstein on the 1997 Fox suit. His name is Maxwell Blecher, and he's busy now, representing Donald Sterling.

Copyright © 2014, Los Angeles Times
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SportsTelevision IndustryDirecTV Group Inc.Antitrust IssuesSatellite TechnologySatellite and Cable ServiceEric Garcetti
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