Washington Nationals and Baltimore Orioles' "escalating war" over TV money

While you were waiting for the Yoenis Cespedes saga to play out [ed. note - "Spoiler Alert: He returned to the New York Mets on a three-year deal."] and watching the snow pile up this weekend [ed. note - "We ended up getting 23 inches at the Federal Baseball headquarters."] another chapter in the Washington Nationals/MLB vs Baltimore Orioles/MASN courtroom drama was playing out, relatively unnoticed. [ed. note - "If you're not familiar with the backstory, sorry, but we have zero interest in rehashing all that years-long nonsense, so you can catch up here, here and here and here and etc."]

The short-as-possible recap, as provided by Hollywood Reporter writer Eriq Gardner in an article on Friday: When the Montreal Expos (then owned by MLB) were looking to relocate to the nation's capital in 2004/2005, Baltimore Orioles' owner Peter Angelos objected, arguing that a team in D.C. would pull fans and television viewers from the O's fan base.

"Back then," Gardner wrote, by way of explanation, "... the parties worked out a deal whereby the Orioles would hold a majority partnership profit interest in MASN and get to telecast Nationals games at a substantial discount from 2005 to 2011. After that, MASN would be obligated to pay the Nationals 'fair market value.'":

The question of 'fair market value' was sent to an internal MLB arbitration panel comprised of three executives from professional baseball. The Orioles didn't like the decision. They thought the Nationals should be paid $34 million each year for telecast rights, but after hearing the experts opine about the value of games, the arbitrators... decided that fees would go as high as $66 million by 2016.

"The Orioles alleged all sorts of shenanigans in the arbitration process, accusing the league of 'corruption' and 'fraud.' In November, the Baltimore Orioles and its Mid-Atlantic Sports Network (MASN) won on one point: the conflict of lawyers. The law firm of Proskauer Rose represented the Nationals at the arbitration, but also represented the MLB in other matters.

"Although the Orioles got the arbitration ruling overturned, it wasn't a complete win as the judge wouldn't order the parties to find new independent arbitrators or handle the case himself. Instead, the Orioles faced the prospect of having to submit to the same internal-MLB arbitration process. The Nationals would have to find new attorneys.

"In vacating the decision," Washington Post writer James Wagner wrote in an early November article, "Justice Lawrence K. Marks suggested that the two sides settle the issue through an independent arbitrator or return to MLB's arbitration panel.":

"'Had MLB, the arbitrators, the Nationals and/or Proskauer taken some reasonable steps to address petitioners' concerns about the Nationals' choice of counsel in the arbitration -- or indeed any step at all -- the Court might well have been compelled to uphold the arbitral award,' Marks wrote in the ruling."

"The decision is now being appealed three ways," Gardner wrote on Friday. "The Nationals are appealing. The Orioles are appealing. MLB is appealing."

After retaining new representation, the Nationals wanted to return to arbitration, but thus far the Orioles have declined, so, "the Nationals have filed a motion to compel the Orioles to comply with the judge's November opinion," Gardner wrote this weekend.

In said motion, the Nationals argued that the Orioles' "refusal" -- Gardner's word -- to move forward is causing harm, as laid out in a memorandum quoted in the Hollywood Reporter article:

"MASN’s underpayment of rights fees has already required the Nationals to fund payroll and other expenses from its own reserves, and further delay could require the Nationals to seek new financing. This is not only burdensome in its own right, but it places the Nationals at a competitive disadvantage to other baseball clubs, which typically receive fair market value from their regional sports networks for their telecast rights. Without this added income, the Nationals are handicapped in their ability to invest in efforts to improve the team. For instance, without this added and steady income, the Nationals cannot bring full economic confidence to investments in multi-year player contracts to keep up with the fierce competition for top players – especially when such control over finances is in the hands of a neighboring club.

"Delay also hamstrings the Nationals’ ability to invest in stadium and related improvements which would generate additional income and help keep the Nationals competitive. In other words, MASN’s refusal to pay the fair market value fees required under the contract forces the Nationals either to have to borrow more money to fund cash flow needs (which comes with its own costs) or to limit or to forego the sorts of investments the Nationals should be making to build the club’s business for the future."

Nationals' vice chairman Ed Cohen, "... asserts that the Orioles are refusing to participate in the arbitration as a way to gain leverage in a negotiated resolution."

Gardner, who also, oddly, portrays the Nationals as "crying about the immediate harm from the Orioles' refusal to play ball," notes that the memorandum was filed with the court as the Nationals were pursuing free agent outfielder Yoenis Cespedes, who reportedly received a 5-year/$100M-ish offer from the Nationals before signing a 3-year/$75M deal with the Mets.

"I hate the DH. I always have hated the DH." - Mike Rizzo

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Washington also reportedly made a $200M-ish offer to Jason Heyward earlier this winter after the Nats signed Max Scherzer to a 7-year/$210M contract last winter.

It is, of course, a fairly simplistic way of looking at things, to say that if the Nationals are able to make these lucrative offers and give Scherzer the sort of deal that they did that they then should be okay with not getting the situation resolved.

One day, hopefully this will all be over, the Nationals just appear to want a resolution sooner rather than later.