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Business litigation filed over team's broadcast network

The owner of a professional baseball team in another state is facing a dilemma that he must fix in order to return the team to prosperity. He says in a business litigation lawsuit filed against the people who sold him the team that they misrepresented the value of the broadcast television network that he got as part of the deal. As California fans would appreciate, a viewing network is essential for loyal fans to take in all of the team's games.

It turns out that the local cable companies do not offer the network. That's because its fees are too high; recently, the network was knocked into an involuntary bankruptcy. The problem is serious because any professional baseball team that cannot broadcast its games widely and regularly will lose millions in revenues and suffer the rapid alienation of its fan base, along with the demoralization of the team's self-image.

The Houston Astros owner is alleging fraud in the representations that were made to him about the strength and viability of the network. The defendants, however, say that the deal was fully transparent and all information was made available. Fraud is the making of a material misrepresentation about a key aspect of a contract or transaction. It is made in order to influence the other party into giving up rights or money.

Fraud can be by active representations that are false or materially deceptive, or it can be carried out by knowingly concealing key facts or defects that should have been revealed. The victim relies on the fraudulent matter to enter into the transaction and sustains a loss from that reliance. When the misrepresentation is discovered, the deceived party may bring a business litigation action for money damages caused by the fraud. Here, the Astros owner is claiming hundreds of millions in lost revenue.

The case will follow typical business litigation procedures that are similar in California and other states. As the case proceeds, the parties will get involved in a complex process of discovery in which the plaintiff will try to obtain all of the records possessed by the sellers when they made certain representations. It's a complicated piece of litigation that will probably involve reams of documents and voluminous company records and correspondences to review and evaluate.

Source: Ledger-Enquirer, Astros owner files lawsuit over network dispute, Juan A. Lozano, Nov. 22, 2013

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