The YankeeNets limited partnership will once again force Madison Square Garden Network to choose whether it wants to match a proposal for New York Yankees games. Last week, YankeeNets reached a one-year, $52 million pact for TV rights to the World Series champions with a subsidiary of International Management Group.
MSGN has until Nov. 24 to match the from offer IMG subsidiary Trans World International, according to a spokeswoman for Howard Rubenstein Associates, which represents the YankeeNets.
The company was formed by the merger of Major League Baseball's Yankees and the National Basketball Association's New Jersey Nets.
An MSGN spokeswoman confirmed that the network received the offer and is "reviewing" its contents, but would not provide more information.
The agreement is more scaled back than a 10-year, $2.5 billion deal YankeeNets proposed to MSG last September. The network eventually sued the partnership Oct. 17, claiming the deal was "outlandish" and not equivalent to the actual value of the rights. MSG dropped the suit later that day, after YankeeNets withdrew the offer.
Sources said the new deal doesn't include a right-of-first refusal clause that MSGN has in its current pact. It has used that clause to keep YankeeNets from creating its own regional sports network.
In July, MSGN filed a breach-of-contract lawsuit against YankeeNets for its failure to allow the network to effectively match Trans World International's bid for cable rights to the team's games.
At the time, TWI would have held a 5-percent interest in Newco, a new company 95-percent owned by the Yankees, which would eventually launch a new regional sports network to compete against MSGN.
To match the offer, MSGN would have needed to buy the 5 percent stake in Newco and match other points that go well beyond the distribution of Yankees games-a clear violation of its $500 million deal with the club, reached in 1988.
New York State Supreme Court Judge Barry Cozier ruled then that under the deal, MSGN would only own 5 percent of the Yankees' rights, and not 100 percent, as is stipulated in the network's current contract.
It's unclear what IMG will do with the Yankees rights if MSGN does not accept the deal. With only five months before the start of the baseball season, it would be nearly impossible to launch a new regional sports network.
The company will most likely resell the rights to another network, but aside from MSG and co-owned Fox Sports New York, there is no regional outlet in the New York DMA with the necessary distribution to telecast the games.