NBA’s $76 Billion TV Deal Features Unique Role for In-House Team

The National Basketball Association’s $76 billion broadcast deal with The Walt Disney Co., Comcast Corp., and Amazon.com Inc. leaned heavily on in-house legal staff experienced in the complexities of multi-tiered media transactions.

The league’s lawyers drive strategy in negotiations over media rights and other deals, said four sources familiar with the situation. They played a role in securing an 11-year deal that will see NBA games broadcast on Comcast’s NBC, Disney’s ABC and ESPN, and Amazon Prime Video, according to one of the sources.

The NBA and its 30 franchises derive the bulk of their value from revenue generated by media rights deals. The transactions have expanded—both in size and scope—with the advent of streaming and digital broadcast partners.

Unlike a publicly traded company doing a traditional M&A deal with the assistance of outside counsel, leagues like the NBA rely on legions of lawyers they already employ to take the lead.

“NBA lawyers live and breathe these television deals every day,” said Tim Browne, a former in-house lawyer for the league who now leads Polsinelli’s sports and entertainment practice.

The league’s ability to add more partners and nearly triple the value of its prior $24 billion TV agreement in a changing media environment should be considered a big win, said Browne. The Polsinelli partner had a key role as an in-house league lawyer on the NBA’s last major media deal a decade ago with ESPN and Turner Broadcasting System Inc., now owned by Warner Bros. Discovery Inc.

The in-house legal team vets media contracts that often tie into other critical business functions such as ticketing, merchandising, and sponsorships. The money flowing from media transactions also forms the framework for an income split with the NBPA, the labor union for the league’s players.

Managing player relationships and maximizing their licensing potential are the two fulcrums of the NBA’s legal business. They both necessitate having a comparatively large amount of dedicated lawyers on staff—on the legal and business side—to understand the nuances of collective bargaining agreements and media rights deals, said four sources familiar with the league’s operations.

Outside counsel provide the brute force necessary to update agreements and other documents overnight as discussions unfold, the sources said. The NBA tapped Covington, a frequent legal adviser to the New York-based league over the years, to work on its most recent media deal.

William Koenig, The NBA’s head of global media distribution, took the lead hammering out the details of its deal with Disney, Comcast, and Amazon, according to two sources familiar with the situation. Koenig worked with Jennifer Chun, the NBA’s head of content partnerships, and media and gaming head Scott Kaufman-Ross, the sources said.

The NBA, whose commissioner Adam Silver and his predecessor David Stern both started their careers in Big Law, has had its ranks been so replete with lawyers over the years that those doing business with the organization have jokingly referred to its acronym standing for “Nothing But Attorneys.”

Rick Buchanan, a former Covington associate, joined the NBA in 1993 and has been its general counsel since 2006.

The new TV deal saw Amazon Prime Video associate general counsel Nathaniel Jackson and senior corporate counsel Monica Estrada take the lead for the company, which was also advised by DLA Piper partner Benjamin Mulcahy.

New Role for Sullivan & Cromwell

Like many big deals this one did not come without complications.

Warner Bros.-owned Turner, the NBA’s soon-to-be-former media partner, is suing the league over being cut out of the latest deal, which is set to go into effect in 2025 and run through 2036.

The dispute arose after the league rejected Turner’s $1.8 billion bid to match a broadcast package for NBA games awarded to streamer Amazon Prime Video.

Sullivan & Cromwell partners Robert Sacks, Richard “Rick” Pepperman II, and Benjamin Walker are representing the NBA and two affiliates in the Warner Bros. litigation, according to court filings. Sullivan & Cromwell has done work in the NBA arena before, but its prior known engagements were peripheral.

Walker has a role in bankruptcy litigation related to Diamond Sports Group, an insolvent regional sports network owned by Sinclair Inc. whose fate as a broadcaster of local NBA games has attracted the league’s interest. Amazon is providing $115 million in financing to restructure Diamond.

The Wall Street law firm advised cable mogul James Dolan, owner of the New York Knicks, on a division of his business interests and also worked on the $1 billion sale of the Atlanta Hawks to private equity mogul Antony Ressler. Billionaire Joseph Tsai, a former Sullivan & Cromwell associate, owns the Brooklyn Nets and WNBA’s New York Liberty.

Buchanan is also involved in the Warner Bros. litigation along with NBA assistant general counsel Daniel Spillane. Warner Bros. is represented by Weil, Gotshal & Manges partners David Yohai and Theodore “Ted” Tsekerides.

Looking Forward

The WNBA, the league’s fast-growing 12-team women’s basketball circuit, is part of the new broadcast package. The WNBA players’ union has criticized the NBA over its $2.2 billion share of the league’s media rights windfall.

The gold medals won over the weekend by the US men’s and women’s national basketball teams, both comprised of NBA and WNBA players, at the Olympics in Paris also demonstrated the strength of the league’s domestic and global brand.

With most of its broadcast and labor deals behind it, the NBA is now expected to turn its attention to potential expansion in Las Vegas, Seattle, or Europe.