The Professional Bull Riders (PBR) announced Tuesday that it has terminated its contractual relationship with Dr. Phil McGraw’s Merit Street Media ahead of PBR’s new season starting Friday night in Tucson.
The reason: PBR says Merit Street is in breach of contract by failing to pay rights fees owed. PBR contends Merit Street gave the league “no choice” and “very little time to find a new home for PBR.”
Merit Street disputes PBR’s position. A company representative said in a statement that PBR was involved in a confidential mediation or arbitration proceeding with PBR when PBR publicly cut ties.
“Merit Street agreed to work out its differences with PBR in a confidential proceeding which is ongoing,” the company representative said. “We were therefore surprised that PBR would publicly accuse us of violating our agreement when the facts are in dispute. And we are astonished that PBR has demanded that its programming be immediately removed from our network while discussions are ongoing. Merit Street will vigorously defend itself in the proceedings.”
Merit Street’s statement suggests the company might contend it chose not to pay for what it sees as a justified reason, such as alleging PBR did not meet contractual requirements. Contractual terms that sometimes generate legal disputes in rights fees agreements are those regarding whether both sides lived up to sponsorship, promotion and signage obligations. Businesses typically use an out-of-court dispute resolution process to prevent the public from being aware of the underlying dispute, which would happen in a litigation as there would be public filings.
But in a response to Merit Street’s statement, PBR insists there are no “no facts in dispute.”
“PBR honored our contracts, and Merit did not,” PBR told Sportico on Thursday. “We gave them 30 additional days to pay the overdue rights fees, and when they didn’t, we had no other choice but to terminate the contract and find a new home for that PBR content, informing our fans where and how to watch, before the new season begins tomorrow.”
According to PBR, it has been a major provider of streaming content to Merit Street, which launched in April and conducted layoffs in August. PBR says its programming reaches 2.4 million total unique viewers on Merit Street and accounts for 31% of Merit Street’s total viewing universe. PBR also says nearly 1.2 million of those viewers came to Merit Street exclusively to watch PBR, thus generating a major viewer boost to McGraw’s nascent multicast television network and streaming service.
PBR’s viewership tends to skew young, whereas some of Merit Street’s most recognizable shows—Dr. Phil and Crime Stories with Nancy Grace—feature comparatively older stars (Dr. Phil is 74 and Grace is 65).
PBR has assured fans they will not lose access to its events. Events that would have been carried on Merit Street will now be carried “live and free” on such services as “RidePass on Pluto TV, PBR’s YouTube channel, PBR’s mobile app and PBR’s app on connected TVs, including Apple TV, Fire TV, Roku and Google TV.”
PBR also highlighted its longstanding relationship with CBS, which it has a deal with through 2030. CBS will continue to carry PBR events on CBS TV and streaming service Paramount+. In addition, PBR touted increased TV ratings, attendance and other accomplishments that indicate an encouraging outlook. Along those lines, a person involved with company business said PBR will announce Friday that Progressive Insurance has become an official sponsor.
Based on their dueling statements, PBR and Merit Street have conflicting interpretations of their contractual rights and obligations. PBR said Merit Street hasn’t paid what it owes, while Merit Street said it and PBR were negotiating a resolution to their disagreement in a confidential proceeding that Merit Street said is ongoing (but is no longer a secret to the public).
The dispute could wind up in court, with both sides potentially suing the other for breach of contract and claiming monetary damages. It is also possible the dispute would first be heard out-of-court if the parties contractually agreed to first mediate or arbitrate—or both—before filing a complaint in court.
Scott Soshnick contributed to this story.
(This story has been updated to include PBR’s statement referenced in paragraphs five and six.)
