Aug. 31 (Bloomberg) -- A Time Warner Inc. unit reached a settlement with Texas businessman David McDavid over the sale of the Atlanta Hawks and the Atlanta Thrashers sports teams after McDavid won a $281 million jury verdict over a failed deal.
Turner Broadcasting System and a lawyer for McDavid confirmed yesterday that an accord has been reached on McDavid’s breach-of-contract claim while declining to specify the terms.
“It’s done,” said McDavid’s attorney, H. Lamar Mixson. “We’re pleased that it’s been done.”
McDavid persuaded a jury in state court in Atlanta in December 2008 that TBS broke a 2003 oral agreement to sell the National Basketball Association’s Hawks and the National Hockey League’s Thrashers to him. The jury award was upheld in March by a Georgia appeals court and a further appeal by TBS was pending in the Georgia Supreme Court.
“In the interest of bringing this seven-year-long matter to a conclusion, we have chosen to resolve it through a settlement,” Misty Skedgell, a TBS spokeswoman, said in a statement yesterday. “Our focus has been and remains on the future of our business.”
The board of New York-based Time Warner, the world’s largest media company, authorized TBS in August 2003 to sell the money-losing teams and the arena they play in, according to testimony in the case.
McDavid, a former part-owner of the NBA’s Dallas Mavericks franchise who had pursued failed bids for the NBA’s Charlotte Hornets and Memphis Grizzlies, negotiated with TBS officials for several months before being told he had a deal to buy the teams for $215 million, one of his lawyers told jurors.
The teams wound up in the hands of an Atlanta-based group of investors that included the son and son-in-law of TBS’s billionaire founder, Ted Turner.
TBS’s lawyers countered throughout the two-month trial that McDavid never got a written agreement spelling out the deal’s terms. Such a contract was required by the NBA and NHL before they would approve the ownership transfers.
McDavid sought about $450 million in damages and interest over the failed deal, a figure based on the value of comparable teams, his lawyers said in court papers.
The trial case is McDavid v. Turner Broadcasting System Inc., 2005-cv-101902, Fulton County Superior Court (Atlanta).
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