CSN Houston, Bankruptcy and Why the Rockets Aren't Just Innocent Victims
|Why are the Rockets seen as the only innocent party?|
In its brief to the court requesting the bankruptcy be dismissed, the Astros state that Comcast offered to buy the Astros shares for an implied enterprise business value of at least $500 million. But due to the operating agreement, the Rockets would have to sign off on the deal. The Rockets instead demanded that Comcast also pay them at least $500 million for its share of the network. Comcast declined the Rockets offer, with the implication being that this torpedoed a possible deal for the Astros. (Houston Astros Closing Brief in Support of its Own Motion to Dismiss, pages 11-12.) The Astros also stated that when Comcast began considering the bankruptcy, it asked the Rockets to be the lead creditor. The Rockets would do so only if paid $500 million by Comcast, which Comcast would not do. (Houston Astros Closing Brief in Support of its Own Motion to Dismiss, page 12.)
So instead of being the innocent party trying to get CSN Houston on TVs for all Houston, the Rockets instead appeared to be attempting to extort money out of Comcast while reneging on an agreed-to cash call, which prevented the Astros from getting money owed. The Rockets have been pretty quiet during this whole endeavor, and neither the Astros nor Comcast attempt to explain the Rockets' actions. But those actions are perhaps among the biggest reasons why the network's currently in bankruptcy and why the Astros were not paid its media rights fees.
The parties return to court today in the first step toward reorganizing the network, finding a way to make it earn a profit, and getting in on the other carriers. The court didn't appoint a trustee, so it'll be up to the partners to make what hasn't yet been able to work now somehow work (though as Crane stated in court in October, the network can succeed with the right plan), with Judge Marvin Isgur being the party who will ultimately sign off on any plan that takes CSN Houston out of bankruptcy.
It can be a bumpy trip, as anyone who's ever flown on a bankrupt airline can attest. Sometimes it works out, sometimes it doesn't. But the only thing for sure now is Rockets and no Astros on your non-Comcast cable TV.