ESPN-MLB Dispute Predates Sunday-Night Squabble: Filings

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New York -- Recent court filings from ESPN's lawsuit
against Major League Baseball revealed that the network's quarrel with the league
dates back long before ESPN acquired the entire National Football League cable package in
1998 and attempted to pre-empt Sunday-night MLB games in September in favor of NFL
contests.

ESPN sued the league in May after it was notified that MLB
was terminating its agreement with ESPN, which runs through 2002, at the end of the 1999
season.

MLB countersued, claiming that ESPN's attempt to
pre-empt Sunday games in September was a breach of contract.

Both sides are to submit briefs laying out their cases
today (Oct. 25), and a jury trial is scheduled to begin Nov. 15.

ESPN suggested in Federal Court papers that internal MLB
documents obtained during discovery proceedings showed that MLB commissioner Allan (Bud)
Selig sought revenge against ESPN after ESPN fought TBS Superstation's conversion to
a basic-cable network in 1996.

ESPN opposed the TBS conversion because it was concerned
that TBS, which airs Atlanta Braves games, would run more baseball on national basic cable
than MLB rights-holder ESPN. But MLB, ESPN and Fox, another MLB rights-holder, agreed on a
settlement that allowed the conversion.

While deposing Selig, ESPN attorney Eric Lobenfeld asked
the MLB chief if he told other MLB executives, "If we're reasonable and they
[ESPN] stiff us [on the TBS approval], I'll try to get even with them every way I
can." Selig responded that he had "no recollection" of making such a
statement.

In court papers obtained last week, MLB attempted to
exclude testimony from Don Ohlmeyer, former NBC West Coast president and a former ESPN
director who sold his sports programming company, OCC, to ESPN for "tens of millions
of dollars" several years ago, according to an MLB filing.

A crux of the case is the clause in ESPN's contract
that allowed it to pre-empt baseball games with MLB approval for "events of
significant viewer interest." MLB argued that Ohlmeyer's "opinion would
mislead the jury and lead to the danger of unfair prejudice," partly because
"Ohlmeyer has no expertise with respect to the clause at issue and, therefore, no
understanding of the industry custom and practice."

ESPN has claimed that the league attempted to extract $350
million more than what the contract provided after ESPN sought to move three September
baseball games to ESPN2.

Buttressing that claim, ESPN's filings included an
April 17, 1998, letter from MLB president and chief operating officer Paul Beeston to ESPN
executive vice president of administration Ed Durso.

In the letter, Beeston presented a "list of items that
we believe must be addressed if we are to consider further your request." The request
was the right to shift three late-season, Sunday-night games to ESPN2 in order to show
far-higher-rated NFL contests on ESPN.

MLB proposed:

• MLB taking back the Sunday-night games "at no
reduction in rights fees," and the league selling the games to an over-the-air
network or another basic-cable network.

• ESPN's rights fees to MLB increasing to $42
million per year from 1998 through 2002.

• ESPN giving MLB a weekly half-hour block of
programming to produce and distribute a youth-oriented baseball program. MLB would provide
four 30-second advertising units to local cable affiliates, and the league would sell the
remaining ad inventory for the show.

• ESPN's regular-season international rights
reverting back to MLB in 1999.

ESPN runs hundreds of hours of MLB programming each year,
including its Baseball Tonight show, which was pulled at the end of the regular
season.

In recent months, MLB executives have said that they
won't shop the Wednesday-night and Sunday-night games in ESPN's contract to
other cable networks until the dispute is resolved. Likely candidates to assume the cable
portion of the contract would include Turner Sports and Fox Sports Net.

MLB spokesman Rich Levin could not be reached for comment
last Friday.

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