NBA's Amazon Deal Reportedly Included Poison Pills To Complicate WBD's Ability To Match

[RealGM Wiretap]

Warner Bros. Discovery contends that the NBA's offer with Amazon was structured in a way that made it impossible for them to match.

The Amazon deal required that NBA games be shown on a platform that also shows NFL games, which would allow for cross-promotion. 

“First, the Amazon Offer required cross-promotion of NBA games during “Thursday Night Football on Prime Video,” WBD’s counsel wrote in their reply brief. “Because Amazon holds the exclusive rights to TNF, only Amazon could perform that obligation.”

The NBA's deal with Amazon also included a $3.2 billion escrow provision whereas no such requirement was included in the NBC deal. At the time, WBD had only $2.98 billion in cash, which would make it difficult to deposit that amount in an escrow account within five days. 

Furthermore, the Amazon deal includes a provision if the company's credit rating is downgrading, the league could pull the plug on the deal. This is an unlikely scenario for Amazon, but would be a distinct possibility given the financial peril of WBD.

“The NBA never intended to allow TBS to match the Amazon Offer," wrote WBD's lawyers.

Via Daniel Kaplan/Awful Announcing

[the_process]

Poison pills are a part of deals.

My understanding is WBD met the escrow requirement by securing a loan.

Requiring a network that carries the NFL shouldn't be applicable IMO, as either WBD had matching rights or they did not. But WBD could be made to buy ad time on TNF to satisfy that part of the contract.

And the credit rating provision is simply something WBD has to live with.

I still think the NBA ends up settling this out of court and agrees to a "hush money payment" (read: settlement with a non-disclosure agreement) to make WBD go away.

[trevorthyme]

poison pills is such evil language. these massive corporations are not ppl, they are not living, and if they have a sucky deal that ends up losing them some of that money they're hording they aren't being poisoned.

[haste10176]

Poison pills are a part of deals.

My understanding is WBD met the escrow requirement by securing a loan.

Requiring a network that carries the NFL shouldn't be applicable IMO, as either WBD had matching rights or they did not. But WBD could be made to buy ad time on TNF to satisfy that part of the contract.

And the credit rating provision is simply something WBD has to live with.

I still think the NBA ends up settling this out of court and agrees to a "hush money payment" (read: settlement with a non-disclosure agreement) to make WBD go away.

Credit rating kind of seems irrelvant once they put the money in escrow.. I dont think they would need to worry about that.. The courts will decide but matching rights should count for something if they say you can do this then matching rights mean nothing or they will have to be specific to say match the dollar amount.. overall WBD did it to themselves could of had the 2.3billion espn deal and said no..