DSG’s Future Hangs on Bankruptcy Hearing As MLB Objects to Plan

After nearly two years of turbulence and many pronouncements of its impending demise, this is the week when Diamond Sports Group finally learns whether it will become a viable company once again. 

The regional sports network operator is scheduled to go before a U.S. Bankruptcy Court judge in a hearing starting Thursday to determine whether its reorganization plan can be confirmed. If the plan is approved, the FanDuel Sports Network parent will have a new lease on life, marking a major turnaround after first filing for bankruptcy in March 2023.

If not, a wind-down of the company that has been expected in some corners for an even longer period of time will almost certainly accelerate. 

There have been several key building blocks in DSG’s slow but steady reorganization. Among them are reworked rights deals with both the NBA and NHL, a restructuring of its debt and resolution of legal claims against parent company Sinclair Inc., a new naming rights deal with FanDuel for the RSNs, and a pending streaming distribution pact with Amazon. 

The MLB Question

There has been one significant obstacle throughout the reorganization process, however: Major League Baseball. The league has been upset with DSG ever since it abruptly dropped its Padres broadcasts early in the 2023 season, and has been regularly critical of the company’s conduct, both in form and function, since then. 

On Friday, MLB filed an expected objection to the reorganization plan, saying “there is a substantial likelihood that the debtors will find themselves in financial distress and/or bankruptcy court in the near future.”

That sentiment highlights a period of significant turbulence for the 12 MLB clubs that DSG televised in 2024. That group has since splintered in several directions, and most are grappling with at least a short-term hit in a critical revenue source—and possibly a longer-term one. The involved clubs’ paths include:

• Angels: The club is finalizing a return to DSG, something that’s been in negotiations for several weeks.
• Braves: This is the one team that has not seen any reduced rights fees to date from DSG, but the company’s assumption of Atlanta’s rights for 2025 was the foundation of MLB’s recent objection in bankruptcy court.
• Brewers, Guardians, and Twins: The trio last month struck separate pacts to have MLB produce and distribute their local games. The Twins, however, are also now up for sale. This group will join the Diamondbacks, Padres, and Rockies in the league-operated model.
• Cardinals: The venerable franchise renewed last week with DSG in a new, multiyear deal that reduces its rights fee by more than 20%.
• Marlins: Like St. Louis, Miami has renewed its ties with DSG. 
• Rangers: The 2023 World Series champions have cut ties with DSG, and Texas is considering starting its own RSN, not unlike the new Victory+ that shows the neighboring Stars of the NHL. Completing a new-look local sports media situation in Dallas, the NBA’s Mavericks also are no longer with DSG and stream their games through MavsTV while broadcasting them over the air on Tegna stations throughout the region. 
• Rays: This is still undetermined, but the local-media situation is hardly the largest of its current issues as the club also has both short-term and long-term facility problems. 
• Reds: Cincinnati’s future landing spot is undetermined, but it also won’t be DSG as late Friday, the club finalized a pact to sell its equity in FanDuel Sports Network Ohio for just $1. 
• Royals and Tigers: These clubs are in a similar, undetermined situation as the Rays. Any return to DSG would require a revised rights deal. 

“We remain in discussions with our other MLB team partners on go-forward plans, and we are confident that our linear and digital framework drives maximum value,” DSG CEO David Preschlack said last week. 

So while baseball’s hot-stove season focuses on players like Juan Soto and Roki Sasaki, there is yet another big piece of offseason drama due to unfold in the coming days.