In a recent development, the NBA has taken steps to shut down Warner Bros. Discovery's legal efforts to compel the league to restore a portion of its media rights to the company. The NBA filed documents in the Supreme Court of the State of New York, seeking dismissal of the case. According to the league, Warner Bros. failed to match the terms of a package of games earmarked for Amazon's Prime Video.

The NBA alleges that Warner Bros. attempted to craft an alternate deal that did not offer the same benefits as Amazon's package. The league highlighted these differences in a letter sent by William Koenig, the NBA's head of media distribution, to Luis Silberwasser, the president of Warner's TNT Sports. The letter stated that Warner's effort to match Amazon's offer "does not qualify" as it included both the TNT cable network and the Max streaming service, whereas Amazon's deal focused solely on streaming distribution.

Warner Bros. Discovery has expressed its disagreement with the NBA's actions, claiming that they fulfilled their contractual right to match the third-party offer. They emphasized the importance of providing choice and flexibility to fans through their widely-distributed platforms, including TNT and Max. The company intends to file its opposition in the coming weeks.

This legal dispute comes after the NBA awarded new 11-year rights deals to Disney, NBCUniversal, and Amazon in July, rejecting Warner Bros.' bid to remain a media partner. The new agreements are set to take effect after the next NBA season.

The games in question are vital for Warner Bros. Discovery, forming a critical component of the TNT schedule and attracting advertisers and cable distributors. The loss of the NBA games was a significant factor in the company's recent decision to take a $9.1 billion write-down on its cable portfolio.

The NBA's letter also revealed details of Amazon's commitment to ensure prompt payments, including the establishment of a rights fee escrow account and a commitment to maintain a credit rating above investment grade. In contrast, Warner Bros. offered letters of credit as an alternative form of security, with delayed accessibility.

Furthermore, Amazon pledged to promote NBA games across its broadest-reaching sports properties, including "Thursday Night Football," while Warner Bros. substituted an obligation to promote the NBA in any "Major Sporting League" distributed on TNT or Max, which included NASCAR and certain college sporting events. This difference in promotional commitment was deemed less valuable to the NBA.

In recent weeks, Warner Bros. Discovery has attempted to bolster its sports portfolio by acquiring rights to the French Open, certain college sports, College Football Playoff games, Big East college basketball, and NASCAR. However, analysts remain cautious about whether these acquisitions will offset the loss of NBA games in the eyes of linear distributors.

The NBA has scheduled an October 4 hearing in New York City, during which it will move for dismissal of the case. The league's spokespersons were unavailable for immediate comment, and further updates on the legal proceedings are expected in the coming weeks.