All systems go for Root launch after CSNH legal hurdles cleared

AT&T and DirecTV were granted a clear path Thursday to launch Root Sports Houston, the new television home for Astros and Rockets games, and to begin televising Rockets games as early as this month.

Based on an agreement between Comcast lawyers and attorneys for AT&T, DirecTV, the Astros and Rockets, U.S. District Judge Lynn Hughes dissolved the last court-imposed delay against closing the new network deal.

However, it remains unclear when Comcast SportsNet Houston, the teams' current home, will fade to black and Root Sports Houston, which will have carriage on DirecTV and AT&T U-verse in addition to Comcast cable, will take its place.

"There's still a process. We don't have an announcement on when this will allow us to (launch Root)," said Rockets general counsel Rafael Stone. "But there's a clear path with no more legal obstacles."

Attorneys reached an agreement that allows Comcast to continue its appeal on financial aspects of the year-long CSN Houston bankruptcy case and for the teams to close on the transactions that will accompany the network sale and the transfer of their broadcast rights to Root Sports Houston.

Bankruptcy Judge Marvin Isgur on Oct. 30 approved a reorganization plan that approved the sale of the Astros-Rockets-Comcast-owned network to AT&T and DirecTV. He also imposed a 14-day stay to allow Comcast to appeal the ruling.

Comcast appealed Isgur's ruling to Hughes and sought to stay the decision while it appealed.

However, Comcast attorneys said Wednesday their primary motive on appeal will be to recoup a $100 million loan granted CSN Houston for startup costs in 2012 and that they would not stand in the way of launching the new network.

Attorneys for the teams, in turn, agreed Root's launch would not be viewed as nullifying Comcast's rights on appeal.

Accordingly, Hughes denied the motion to stay Isgur's order and also terminated the automatic stay granted by the bankruptcy court.

Attorneys earlier indicated the new network could launch Nov. 14, but DirecTV would not confirm that date. CSN Houston's telecast schedule now extends through Nov. 16.

"It's great for the city," Rockets owner Leslie Alexander said. "It's great for the Rockets' fans, and I'm thrilled. Thank you very much to Judge Hughes for letting fans be able to watch the Rockets."

Added Astros general counsel Giles Kibbe: "We're ready to get the games on TV. It's great to start the Rockets' season. It's great for the fans of Houston. It's an exciting time."

Under the reorganization plan approved by Isgur, the Astros, Rockets and Comcast will lose their network equity, and the teams agreed to forgo immediate payment of more than $100 million in unpaid rights fees.

Only 45 of the 141 CSN Houston employees will be retained by Root, which will show Rockets and Astros games but will not retain CSN Houston's news and talk shows.

Comcast will continue to contest Isgur's determination that it is not due full repayment of its $100 million secured loan. Comcast is currently scheduled to receive only $26 million.

Attorneys met behind closed doors for more than 90 minutes Wednesday and also met with Hughes, who apparently encouraged a settlement that would enable him to avoid having to rule on the stay request.

"One reason I want to handle this as expeditiously as possible is so I can get rid of you guys," Hughes said. "This hasn't been much fun the last 15 months."

Attorneys now will work on legal briefings related to the financial issues, which may be discussed after the Thanksgiving holidays.