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Rumble in Regional Sports BEFORE THE FEDERAL COMMUNICATIONS COMMISSION WASHINGTON, D.C. 20554 ____________________________________ In the Matter of ) ) TCR Sports Broadcasting Holding, L.L.P., ) ) Complainant, ) ) v. ) File No. ____________ ) Comcast Corporation, ) ) Defendant. ) ____________________________________) REPLY IN SUPPORT OF CARRIAGE AGREEMENT COMPLAINT EXHIBITS 1 - 16 Michael K. Kellogg David C. Frederick Priya R. Aiyar Robert A. Klinck Kellogg, Huber, Hansen, Todd, Evans & Figel, P.L.L.C. 1615 M Street N.W. Suite 400 Washington, D.C. 20036 (202) 326-7900 Dated: August 3, 2005 Attorneys for TCR Sports Broadcasting Holding, L.L.P. EXHIBIT 1 IN THE CIRCUIT COURT FOR MONTGOMERY COUNTY, MARYLAND __________________________________________ ) COMCAST SPORTSNET MID-ATLANTIC, ) L.P., ) ) Plaintiff, ) ) v. ) Civil Action No. 260751-V ) BALTIMORE ORIOLES L.P., TCR SPORTS ) MEMORANDUM IN OPPOSITION BROADCASTING HOLDING, L.L.P., MAJOR ) TO DEFENDANTS’ MOTIONS TO LEAGUE BASEBALL, MID-ATLANTIC ) DISMISS SPORTS NETWORK, ) ) Defendants. ) __________________________________________) MEMORANDUM IN OPPOSITION TO DEFENDANTS’ MOTIONS TO DISMISS WILLIAMS & CONNOLLY LLP ETHRIDGE, QUINN, McAULIFFE, ROWAN & HARTINGER Robert B. Barnett J. Alan Galbraith John M. Quinn John E. Schmidtlein Michael L. Rowan 725 Twelfth Street, N.W. 33 Wood Lane Washington, D.C. 20005 Rockville, MD 20850 (202) 434-5000 (301) 762-1696 Counsel for Plaintiff Comcast SportsNet Mid-Atlantic, L.P. July 12, 2005 TABLE OF CONTENTS TABLE OF CONTENTS................................................................................................................. i TABLE OF AUTHORITIES .........................................................................................................iii INTRODUCTION .......................................................................................................................... 1 RELEVANT FACTS...................................................................................................................... 3 A. The CSN Regional Sports Network........................................................................ 3 B. The 1994 Agreement Between HTS and the Orioles.............................................. 4 C. The 1996 Agreement Between HTS, the Orioles and TCR.................................... 6 D. The 2005 Agreement Between MLB, the Orioles, TCR and the Washington Nationals To Form MASN ............................................................... 10 NATURE OF ACTION ................................................................................................................ 13 STANDARD OF REVIEW .......................................................................................................... 13 ARGUMENT................................................................................................................................ 14 I. THE ORIOLES’ TRANSFER OF FUTURE TELEVISION RIGHTS TO MASN HAS BREACHED THE 1996 AGREEMENT.................................................... 14 A. The Orioles Transferred Television Rights in 1996 to CSN and Have Transferred Future Television Rights to MASN in 2005 Thereby Triggering the 1996 Exclusive Negotiation and Right To Match Provisions.............................................................................................................. 15 B. CSN Has Posited a Reasonable Interpretation of the 1996 Agreement in Support of its Breach of Contract Claim that Cannot Be Rejected on a Motion To Dismiss............................................................................................. 19 1. The nature and purpose of exclusive negotiation and right to match provisions ....................................................................................... 21 2. The circumstances surrounding and the course of dealing established by the negotiation and execution of the 1994 and 1996 Agreements ...................................................................................... 23 i 3. The Court should not adopt Defendants' interpretation that would render the right to match and exclusive negotiation provisions meaningless and produce an unjust result............................... 28 C. The Case Law Cited by Defendants Is Distinguishable........................................ 30 II. CSN HAS STATED A COGNIZABLE CLAIM FOR BREACH OF THE IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING ............................. 35 III. THE EXCLUSIVE NEGOTIATION PROVISION IN THE 1996 AGREEMENT IS ENFORCEABLE................................................................................ 41 IV. CSN HAS PLED A VIABLE CLAIM FOR TORTIOUS INTERFERENCE WITH CONTRACT.......................................................................................................... 43 V. THE COURT SHOULD NOT DISMISS CLAIMS AGAINST MASN OR TCR AT THIS STAGE OF THE PROCEEDINGS ......................................................... 45 CONCLUSION............................................................................................................................. 45 ii TABLE OF AUTHORITIES FEDERAL CASES 7-Eleven, Inc. v. McEvoy, 300 F. Supp. 2d 352 (D. Md. 2004)...............................................35, 36 Abt Associates, Inc. v. JHPIEGO Corp., 104 F. Supp. 2d 523 (D. Md. 2000), aff’d, 9 Fed. Appx. 172 (4th Cir. 2001).............................................................................................35, 39 Ace & Co. v. Balfour Beatty PLC, 148 F. Supp. 2d 418 (D. Del. 2001) .......................................31 Adams v. NVR Homes, Inc., 135 F. Supp. 2d 675 (D. Md. 2001)..................................................39 Candid Products, Inc. v. International Skating Union, 530 F. Supp. 1330 (S.D.N.Y. 1982).......................................................................................................................42, 43 Catalina Enterprises, Inc. Pension Trust v. Hartford Fire Insurance Co., 67 F.3d 63 (4th Cir. 1995)................................................................................................................................20 Channel Home Centers. v. Grossman, 795 F.2d 291 (3d Cir. 1986).............................................43 Coakley & Williams Construction, Inc. v. Structural Concrete Equipment, Inc., 973 F.2d 349 (4th Cir. 1992) .........................................................................................................21 Eastern Shore Markets, Inc. v. J.D. Associates Ltd. Partnership, 213 F.3d 175 (4th Cir. 2000)..........................................................................................................................35, 36 Eaglehead Corp. v. Cambridge Capital Group, Inc., 170 F. Supp. 2d 552 (D. Md. 2001) ..........39 Esca of Baltimore, LLC v. Colkitt, 164 F. Supp. 2d 584 (D. Md. 2001) .......................................14 Estrin v. Natural Answers, Inc., 103 Fed. Appx. 702, 705 (4th Cir. 2004) ...................................38 Frandsen v. Jensen-Sundquist Agency, Inc., 802 F.2d 941 (7th Cir. 1986) ..................................33 Government of the United Kingdom of Great Britain and Northern Ireland v. Northstar Services, Ltd., 1 F. Supp. 2d 521 (D. Md. 1998)...............................................21, 25, 26 Howard Opera House Associates v. Urban Outfitters, Inc., 166 F. Supp. 2d 917 (D. Vt. 2001)..................................................................................................................................40 Kham & Nate’s Shoes No. 2, Inc. v. First Bank, 908 F.2d 1351 (7th Cir. 1990) ..........................41 iii Local America Bank of Tulsa v. United States, 52 Fed. Cl. 184 (Ct. Fed. Cl. 2002) ....................41 Marland v. Safeway, 65 Fed. Appx. 442 (4th Cir. 2003)...............................................................39 Maryland National Bank v. Traenkle, 933 F. Supp. 1280 (D. Md. 1996).....................................36 Nomeco Building Specialties, Inc. v. Pella Corp., 184 F.R.D. 609 (D. Minn. 1999)....................40 O’Tool v. Genmar Holdings, Inc., 387 F.3d 1188 (10th Cir. 2004) ..............................................40 Oregon RSA No. 6, Inc. v. Castle Rock Cellular of Oregon Ltd. Partnership, 840 F. Supp. 770 (D. Or. 1993) ...............................................................................................36, 37 Oregon RSA No. 6, Inc. v. Castle Rock Cellular of Oregon Ltd. Partnership, 76 F.3d 1003 (9th Cir. 1996) .........................................................................................................37 Paramount Brokers, Inc. v. Digital River, Inc., 126 F. Supp. 2d 939 (D. Md. 2000) .......35, 38, 42 Thomas J. Kline, Inc. v. Lorillard, Inc., 878 F.2d 791 (4th Cir. 1989)..........................................25 U.S. Cellular Investment Co. of L.A., Inc. v. GTE Mobilnet, Inc., 281 F.3d 929 (9th Cir. 2002)................................................................................................................................33 UNREPORTED FEDERAL CASES Case Credit Corp. v. Stephens & Michaels Associates, Inc., No. 04-C-0716, 2005 WL 1154262 (E.D. Wis. Apr. 28, 2005)...............................................................................40 Fox Sports Net Minnesota, LLC v. Minnesota Twins Partnership, No. 01-961 (DSD/SRN), 2002 U.S. Dist. LEXIS 8896 (D. Minn. May 6, 2002) ................................22, 25, 26 Mieuli v. DeBartolo, No. C-00-3225 JCS, 2001 U.S. Dist. LEXIS 22518 (N.D. Cal. Jan. 16, 2001) ...................................................................................................14,
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