Thursday, September 6, 2012
Legal case from 1970 revisted
NEW YORK -- The NBA asked a Manhattan judge on Thursday to side with the league in a legal battle with origins in the bygone era of short shorts, low-top sneakers and big Afros.
The dispute stems from a sweetheart deal that's enjoyed by the former owners of a defunct American Basketball Association team -- and despised by current owners of four NBA franchises.
It all began in 1970, when future legends like Oscar Robertson, John Havlicek and Bill Bradley filed an antitrust lawsuit challenging the NBA's then-proposed merger with the ABA.
As part of a settlement reached in 1976, the St. Louis Spirits of the ABA agreed to fold. In exchange, the NBA was required starting in 1980 to pay Spirits owners Ozzie and Dan Silna a portion of the television revenue earned by the four ABA teams that survived the merger: the Indiana Pacers, now Brooklyn Nets, Denver Nuggets and San Antonio Spurs.
Because the four teams must share with the Silnas as long as the NBA exists, the brothers have quietly made a killing off league's explosion in popularity in recent decades -- by some estimates, around $240 million so far.
"Every year, when it came down to take a look at the budgeting process we would all just shake our heads," a former Nuggets executive once told the Los Angeles Times.
But the brothers have now called a technical foul: Last year, they asked the court to reopen the old antitrust case, claiming that the league has unfairly cut them out of revenue from international broadcasts and cable packages.
The judge who had originally presided over the case in federal court in Manhattan died last year. But a current judge, Loretta Preska, agreed to take a look.
NBA lawyer Jeff Mishkin argued on Thursday that the revenue-sharing provision applied only to national broadcasts by traditional TV networks.
Mishkin said the agreement makes clear that, "You get network television revenues -- and that's all you get." The NBA, he added, "has never not met its obligation."
The brothers' attorney, Michael Carroll, countered that wording in the settlement referring to revenue from "all broadcasts" should be interpreted to include more modern TV offerings like NBA League Pass, which allows viewers to see out-of-market games.
Preska told the parties she would review their court filings before making any ruling. In the meantime, she suggested they should try to find a way to share the wealth without one.
"I think you people ought to sit down and talk about this," she said.