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Astros, Rockets Owed Nearly $28 Million Apiece in CSN Bankruptcy Case

Clubs Seek Unpaid Rights Fees; Top 25 Unsecured Creditors Claim They're Owed $60 Million 2/18/2014 9:45 AM Eastern

 

Not surprisingly, the Houston Astros and Houston Rockets top the list of unsecured creditors in the Comcast SportsNet Houston bankruptcy case,

According to a report in the Houston Chronicle, court documents filed on Feb. 17 show that the MLB franchise is owed nearly $27.9 million, while the NBA club is owed $27.7 million in rights fees. The teams control 46.5% and 31%, respectively, of the embattled RSN, with Comcast-NBCUniversal holding the balance.

The claims were filed ahead of Tuesday’s hearing before U.S. Bankruptcy Judge Marvin Isgur, who placed Houston Regional Sports Network, the parent of CSN Houston, under chapter 11 bankruptcy protection on Feb. 5. The Astros, who oppose the bankruptcy, have appealed the case to U.S. District Judge Lynn Hughes. She will meet with attorneys Friday.

Beyond Comcast, CSN Houston has only been able to ink distribution deals with a handful of smaller distributors in the Houston DMA, leaving it without carriage throughout the rest of its five-state TV territory. As such, CSN Houston has been unable to meet its rights obligations: the Astros didn’t receive a payment during the final three months of the 2013 MLB campaign, while the Rockets have yet to be paid during the 2013-14 NBA season. RSNs typically derive upward of 70% of their revenue from monthly subscriber fees.

According to the Chronicle's report, the top 25 unsecured creditors are owed some $60 million, with NBA Media Ventures, seeking $1.5 million, ranking as the third largest creditor. Among other claimants, Comcast Sports Management Services, NBC Universal Media, Home Team Sports and Game Creek Video, are owed six-figure sums by CSN Houston.

Tuesday's hearing is expected to be the first of several in which attorneys with law firm Haynes and Boone, repping the RSN in the proceedings, will present routine business requests to Isgur to keep the company afloat as it looks to reorganize.