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Solar, ABS-CBN row over NBA broadcast moves to court

MANILA, Philippines – The ball has started rolling in court – regional trial court, that is – for Solar Entertainment and ABS-CBN and subsidiary Sky Cable, which are entangled in a civil case over the rights to air NBA games in the Philippines.

The Mandaluyong Regional Trial Court (RTC) Branch 209 granted a preliminary attachment on May 16 to Solar Entertainment, which is suing ABS-CBN for P659.458 million in alleged unpaid fees

The preliminary attachment, considered a regular procedure in similar civil cases, means the court is holding that much worth of ABS-CBN's assets so that, should Solar win the lawsuit, the assets are available for payment.

In a statement issued on Tuesday, May 30, ABS-CBN said the court lifted the attachment on Monday, May 29, the same day that they filed a motion to lift it.

Before that, when the court granted the preliminary attachment, it also ordered Solar to pay P659.458 million as bond to "answer for the cost of damages" should ABS-CBN win the lawsuit. Solar's bond payment was accepted on May 24.

Solar's lawyers from the Divina Law firm explained to Rappler that the lifting of the attachment was due to ABS-CBN posting a counter-bond of P670 million. In simple terms, that counter-bond is now considered the guarantee money that Solar will be paid should it win the lawsuit.

What happens now? The case moves forward.

"We will submit our answer with counterclaims to this complaint. We are confident we will prevail," ABS-CBN said in its statement.

Dispute

Solar filed its instant complaint for sum of money and damages before the Mandaluyong court on May 11. It alleges that ABS-CBN, as owner of Sky Cable, owes P659.458 million or 3 years worth of unpaid carriage fees.

Solar has the airing rights to NBA games in the Philippines. Solar and Sky Cable entered into an agreement in 2010 so that Solar's NBA channels Basketball TV (BTV) and NBA Premium will be aired over Sky Cable.

For that, Sky Cable pays Solar carriage fees.

Meanwhile, Solar's agreement with the NBA was due to expire in 2014. According to Solar, as the expiry date neared, ABS-CBN made its own efforts to secure the exclusive rights of NBA games "at the expense of Solar."

In July 2014, NBA Entertainment or NBAE entered into a Television License Agreement with Solar and ABS-CBN, where both networks were given rights to air NBA games.

For Solar, it could air the games over BTV and NBA Premium TV. For ABS-CBN, it could air the games on its free channels – the main channel 2, ABS-CBN Sports and Action, and "a non-NBA branded pay TV channel to be developed."

While ABS-CBN aired it on the said channels, Sky Cable continued to carry BTV and NBA Premium. But, according to Solar, ABS has stopped paying since 2014.

Solar said that when it sent notices to Sky Cable about the non-payment, Sky answered, saying they were no longer obliged to pay carriage fees because ABS-CBN is already a co-licensee of the NBA by virtue of the 2014 TV license agreement.

"Worse, Solar discovered that Sky Cable has been offering and distributing NBA Premium TV to the public as part of a subscription plan, tier, or bundle with other channels, contrary to, and in violation of, the prior terms of the Channel Carriage Agreements," according to the decision by Branch 209 Presiding Judge Monique Quisumbing-Ignacio.

Fraud?

Solar chairman Wilson Tieng claims that the issue goes beyond the non-payment. Tieng told the court that ABS-CBN is not paying intentionally so that it could bleed Solar dry until Solar could no longer afford the NBA license.

"By creating a scenario where they will not pay us, nobody can afford such big amount of utang (debt). We already loaned from every bank that we can get money to pay NBA. If we will not pay, NBA will cut us, ABS-CBN will be happy. That is the conspiracy, that is the fraud," Tieng told the court according to case records.

"ABS-CBN has been salivating for the NBA the whole time, they want the NBA," Tieng had said.

"In 2014, ABS-CBN and Solar jointly entered into a license agreement with NBA Properties Incorporated. Since ABS-CBN was paying 60% of the license fees, it considered that the same already covered the carriage fees of Sky Cable. Unfortunately, Solar disagreed," ABS-CBN said in the statement.

Sky Cable subscribers noticed around April that the NBA games were no longer being carried on their paid cable. It was also when the NBA playoffs kicked off, frustrating hoops fans subscribed to Sky.

It remains unavailable on Sky Cable, days before the NBA Finals begin on Thursday, June 1 (Friday, June 2 in Manila). 

"Despite the good faith attempts of ABS-CBN and Sky Cable to resolve the dispute amicably, Solar cut off the NBA feed to Sky Cable and filed this complaint," ABS-CBN said.

Solar's lawyers said the next court hearing has not been scheduled. – Rappler.com

Lian Buan

Lian Buan covers justice and corruption for Rappler. She is interested in decisions, pleadings, audits, contracts, and other documents that establish a trail. If you have leads, email lian.buan@rappler.com or tweet @lianbuan.

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