Attorneys representing the interests of Houston pro sports teams the Astros and Rockets have filed suit against Comcast (NASDAQ: CMCSA) and several of its subsidiaries and executives, seeking to recoup hundreds of millions of dollars in investments in the biggest regional sports network (RSN) failure ever, CSN Houston.
Following a bankruptcy court agreement in November, DirecTV (NASDAQ: DTV) and AT&T (NYSE: T) now jointly control the RSN, now named Root Sports Houston. The channel, which carries Astros baseball and Rockets basketball games, is available in the vast majority of Houston-areas pay-TV homes, including those serviced by Comcast.
But it wasn't always this way.
The channel--originally launched in 2012 as CSN Houston, a joint venture by the Astros, Rockets and Comcast--failed to negotiate carriage beyond Comcast for its first two years on the air, leaving the majority of Houston sports fans blacked out from their favorite teams for several years.
The teams now accuse Comcast of sabotaging negotiations with rival pay-TV operators for the purpose of wielding sole control of CSN Houston.
In the 64-page suit, filed June 11 in U.S. Bankruptcy Court, attorneys representing the sports teams accuse Comcast of "intentionally and willfully [failing] to negotiate and obtain the best possible carriage rates" for CSN Houston, all for the purpose of "financially crippling [CSN Houston] so that it would have no choice but to sell itself to Comcast."
Of course, no battle with Comcast would be complete without a shot at the cable giant's customer service reputation.
"Year after year," the suit reads, Comcast "is consistently ranked amongst the worst in customer service in the country. But individual customers are not the only ones who have borne the brunt of Comcast's bad behavior."
The suit was actually filed by attorneys representing "Houston Regional Sports Network," which is the company formed by the Astros and Rockets to represent their interests in the joint venture.
According to the Houston Chronicle, which has most closely tracked the fall and rise of the RSN, the suit is seeking damages and penalties as high as nine figures.
As the Chronicle notes, this is not a surprise. As part of bankruptcy court Judge Marvin Isgur's approved reorganization in November that transitioned the team to DirecTV and AT&T, a litigation trust was created to distribute payments from expected lawsuits against Comcast.
For more:
- read this Houston Chronicle story
Related links:
Former CSN Houston relaunches as Root Sports Southwest
Comcast to appeal CSN Houston ruling, but DirecTV, AT&T movie ahead with plans for RSN
Bankruptcy ruling finally clears sale of CSN Houston to AT&T and DirecTV