YES Network Sues Time Warner
By Stephen Donohue -- Multichannel News, 9/2/2003 4:00:00 AM
Leo J. Hindery Jr.’s Yankees Entertainment & Sports Network sued Time Warner Cable for breach of contract on Friday for its June decision to kick YES out of expanded basic following Cablevision Systems Corp.’s strategy of offering the regional sports network à la carte.
The YES complaint, drafted by the law firm of prominent attorney David Boies, is no ordinary breach-of-contract suit.
While the crux of the case centers on whether the most-favored-nation clause in Time Warner’s YES suit would allow the MSO to kick YES out of basic, YES is throwing gasoline on the flames by accusing Cablevision and Time Warner Cable of shenanigans by teaming up to crush YES.
The YES complaint pointed to a recent carriage deal Cablevision cut with Time Warner Cable corporate sister Turner Classic Movies, suggesting that Cablevision never would have agreed to carry the competitor to its company-owned AMC if it wasn’t in cahoots with Time Warner Cable.
“Although Time Warner Cable does not compete with YES, it has an economic incentive to assist Cablevision in its discriminatory conduct toward YES in order to procure Cablevision’s assistance in limiting the distribution of unaffiliated networks that compete with Time Warner Cable in Cablevision’s franchise territory,” YES alleged in the complaint.
After Cablevision cut an interim deal with YES to offer the net à la carte or in a tier with Madison Square Garden Network and Fox Sports New York, Time Warner Cable announced in June that it was exercising its MFN clause with YES by giving subscribers the option to keep YES at no extra charge or drop the channel and save $1 from their monthly cable bills.
But YES argued in the suit that Time Warner Cable can’t trigger the MFN clause because Cablevision’s YES agreement is only an interim deal.
YES also hammered Time Warner Cable for deciding not to carry MSG and FSNY in the same manner that it’s carrying YES.
“TWC’s willingness to breach the affiliation agreement with YES, but to avoid repositioning the MSG and FSNY regional sports networks, smacks of anticompetitive discrimination,” YES said in the complaint.
A Time Warner spokesman didn’t return calls Friday.
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