BELO FILES LAWSUIT OVER MAVERICKS DEAL

By: Karim Mostafa Company Wants Out Of Basketball Business





Belo, the Dallas-based multimedia company, announced Monday that
it has filed a lawsuit in a Dallas state court against Dallas
Mavericks owner Mark Cuban, citing a contractual dispute between
the two.


Michael J. McCarthy, senior executive vice president at Belo,
said in a statement: "Belo has a binding agreement to sell Belo's
interest in the Mavericks and the American Airlines Center to
Mark Cuban. Mr. Cuban has refused to abide by the terms of this
agreement. We are reluctant plaintiffs in this dispute and are
disappointed that we have to resort to litigation to enforce
Belo's contractual rights."



Belo, which owns a 12.38% interest in the Dallas basketball team,
announced in July that it had reached an oral agreement to sell
its interest in the Mavericks and its related arena interests to
the team's majority owner for approximately $34.5 million.


Mark Cuban told E&P Online that there was no signed contract,
just ongoing negotiations. "The reason we were unable to reach an
agreement was because I had made it clear to Belo Management that
I was only going to sign the agreement once Belo demonstrated to
me that they were able to consistently keep up their end of the
deal, which was ongoing, expanded editorial coverage of the
Dallas Mavericks in The Dallas Morning News," Cuban wrote
in an e-mail on Monday.


Cuban added, "In fact, I was told multiple times by people inside
Belo who were not active in the editorial meetings, that coverage
of the Mavericks was to be curtailed rather than expanded, which
was the opposite of what they had told me in our meetings with
management."



How the Morning News was going to cover the Mavericks
became an issue in August 1999 when the alternative newspaper
Dallas Observer published messages posted to the
Morning News' internal message board by three Morning
News reporters. The Observer reported in the Aug. 11, 1999 edition that "The three wrote
that the Morning News' coverage of Belo's investment was
unbalanced and that the paper's credibility was suffering because
of Belo's close ties to the business establishment."



For Cuban it was the lack of Maverick coverage that broke the
pending deal. "The final straw was when shortly after one such
meeting they failed to offer any editorial coverage of the
Mavericks on the day we had a game with the Miami Heat," Cuban
said. "I then told my lawyers and Belo that we would end all
negotiations, and not pursue a potential deal any further."


News executives at the Morning News declined to comment.
McCarthy, in the press release, said, "Belo will have no further
comment to make during the pendency of this litigation."



Cuban, co-founder of Broadcast.com, bought the Dallas Mavericks
from Hillwood Development Corp., chaired by Ross Perot Jr., in
January. He sold Broadcast.com to Yahoo! in July 1999.






Karim Mostafa (kmostafa@editorandpublisher.com) is associate editor for E&P Online.







Copyright 2000, Editor & Publisher.