Fox Sues to Block Sale of Sports Cable Network

Fox Entertainment Group Inc. sued to block Comcast Corp. from buying Viacom Inc.’s two-thirds stake in Home Team Sports, a cable television sports network one-third owned by Fox.

Fox said it was improperly excluded from secret negotiations between Comcast and Viacom. The suit against Viacom, the world’s No. 3 media company, and Comcast, the third-largest U.S. cable TV provider, was filed in Delaware Chancery Court in Wilmington.

Comcast said on July 11 it would buy Viacom’s two-thirds stake in Home Team Sports, an agreement that Fox contends the court should block. Fox said Viacom violated a contract by denying it a chance to acquire HTS or to sell its stake to Comcast on the same terms Viacom received.

“Viacom chose to ignore its obligations as our majority partner and traded its interest for unique and invaluable assets beneficial to them alone,” said Jeff Shell, chief executive of Fox Cable Networks.

Fox, the New York-based company controlled by News Corp. Chairman Rupert Murdoch, declined to comment further. Philadelphia-based Comcast and New York-based Viacom also declined to comment.

Viacom received the stake in HTS when it acquired CBS Corp. for $50.2 billion in May. HTS was started in 1990 by Fox and Group W, which later became CBS. Fox claimed in the lawsuit that Viacom is responsible for upholding the network’s original ownership agreements.

Comcast shares rose $1.12 to close at $34.19 on Nasdaq. Viacom rose $2.62 to $69.12 and Fox fell 44 cents to close at $31.56 on the New York Stock Exchange.