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Case 13-35998 Document 1 Filed in TXSB on 09/27/13 Page 1 of 5

B 5 (Official Form 5) (12/07)

UNITED STATES BANKRUPTCY COURT


SouthernDistrict District of __________ of Texas __________
IN RE (Name of Debtor If Individual: Last, First, Middle)

INVOLUNTARY PETITION

ALL OTHER NAMES used by debtor in the last 8 years (Include married, maiden, and trade names.)

Houston Regional Sports Network, L.P.


Last four digits of Social-Security or other Individuals Tax-I.D. No./Complete EIN (If more than one, state all.):

02-0689642
STREET ADDRESS OF DEBTOR (No. and street, city, state, and zip code) MAILING ADDRESS OF DEBTOR (If different from street address)

1201 San Jacinto Street, Suite 200 Houston, TX


COUNTY OF RESIDENCE OR PRINCIPAL PLACE OF BUSINESS

Harris County

ZIP CODE

ZIP CODE

77002
LOCATION OF PRINCIPAL ASSETS OF BUSINESS DEBTOR (If different from previously listed addresses) CHAPTER OF BANKRUPTCY CODE UNDER WHICH PETITION IS FILED

Chapter 7

Chapter 11
INFORMATION REGARDING DEBTOR (Check applicable boxes)

Nature of Debts (Check one box.) Petitioners believe:

Debts are primarily consumer debts Debts are primarily business debts

Type of Debtor (Form of Organization) Individual (Includes Joint Debtor) Corporation (Includes LLC and LLP) Partnership Other (If debtor is not one of the above entities, check this box and state type of entity below.)

_________________________________________ VENUE

Nature of Business (Check one box.) Health Care Business Single Asset Real Estate as defined in 11 U.S.C. 101(51)(B) Railroad Stockbroker Commodity Broker Clearing Bank Other

FILING FEE (Check one box)

Debtor has been domiciled or has had a residence, principal place of business, or principal assets in the District for 180 days immediately preceding the date of this petition or for a longer part of such 180 days than in any other District. A bankruptcy case concerning debtors affiliate, general partner or partnership is pending in this District.

Full Filing Fee attached

Petitioner is a child support creditor or its representative, and the form specified in 304(g) of the Bankruptcy Reform Act of 1994 is attached. [If a child support creditor or its representative is a petitioner, and if the petitioner files the form specified in 304(g) of the Bankruptcy Reform Act of 1994, no fee is required.]

Name of Debtor Relationship

PENDING BANKRUPTCY CASE FILED BY OR AGAINST ANY PARTNER OR AFFILIATE OF THIS DEBTOR (Report information for any additional cases on attached sheets.) Case Number Date District ALLEGATIONS (Check applicable boxes) Judge

COURT USE ONLY

1. 2.

Petitioner (s) are eligible to file this petition pursuant to 11 U.S.C. 303 (b). The debtor is a person against whom an order for relief may be entered under title 11 of the United States Code. 3.a. The debtor is generally not paying such debtors debts as they become due, unless such debts are the subject of a bona fide dispute as to liability or amount; or b. Within 120 days preceding the filing of this petition, a custodian, other than a trustee receiver, or agent appointed or authorized to take charge of less than substantially all of the property of the debtor for the purpose of enforcing a lien against such property, was appointed or took possession.

Case 13-35998 Document 1 Filed in TXSB on 09/27/13 Page 2 of 5


B 5 (Official Form 5) (12/07) Page 2
Houston Regional Sports Network, L.P. Name of Debtor______________________

Case No.____________________________
TRANSFER OF CLAIM

Check this box if there has been a transfer of any claim against the debtor by or to any petitioner. Attach all documents that

evidence the transfer and any statements that are required under Bankruptcy Rule 1003(a).
REQUEST FOR RELIEF Petitioner(s) request that an order for relief be entered against the debtor under the chapter of title 11, United States Code, specified in this petition. If any petitioner is a foreign representative appointed in a foreign proceeding, a certified copy of the order of the court granting recognition is attached. Petitioner(s) declare under penalty of perjury that the foregoing is true and correct according to the best of their knowledge, information, and belief.

/s/ Bruce A. Davis, VP Financial Operations x__________________________________________________________ Signature of Petitioner or Representative (State title)
National Digital Television Center, LLC

/s/ Vincent P. Slusher 09/27/2013 x______________________________________________________ Signature of Attorney Date


DLA Piper LLP (US)

09/27/2013
Date Signed
Bruce A. Davis 4100 E. Dry Creek Road ______________________ Centennial, CO 80122

Name of Petitioner Name & Mailing Address of Individual Signing in Representative Capacity

Name of Attorney Firm (If any) 1717 Main Street, Suite 4600, Dallas, Texas 75201-4629 _______________________________________________________ Address
(214) 743-4572

______________________

Telephone No.

/s/ Jon D. Litner, President x__________________________________________________________ Signature of Petitioner or Representative (State title)
Comcast Sports Management Service, LLC

/s/ Vincent P. Slusher 09/27/2013 x______________________________________________________ Signature of Attorney Date


DLA Piper LLP (US)

09/27/2013
Date Signed

Name of Petitioner Name & Mailing Address of Individual Signing in Representative Capacity

Jon D. Litner One Comcast Center ______________________ Philidelphia, PA 19103

Name of Attorney Firm (If any) 1717 Main Street, Suite 4600, Dallas, Texas 75201-4629 _______________________________________________________ Address
(214) 743-4572

______________________

Telephone No.

/s/ Robert S. Pick, SVP x__________________________________________________________ Signature of Petitioner or Representative (State title)
Houston SportsNet Finance, LLC
Name of Petitioner Name & Mailing Address of Individual Signing in Representative Capacity

/s/ Vincent P. Slusher 09/27/2013 x______________________________________________________ Signature of Attorney Date


DLA Piper LLP (US)

09/27/2013
Date Signed

Robert S. Pick One Comcast Center ______________________ 1701 JFK Blvd. Philidelphia, PA 19103

Name of Attorney Firm (If any) 1717 Main Street, Suite 4600, Dallas, Texas 75201-4629 _______________________________________________________ Address
(214) 743-4572

______________________

Telephone No.

Name and Address of Petitioner Name and Address of Petitioner

PETITIONING CREDITORS * Nature of Claim

Amount of Claim*

National Digital Television Center, LLC, 4100 E. Dry Creek Road, Centennial, CO 80122

Services Rendered
Nature of Claim Amount of Claim *

10,517.50
1,251,573.75
Amount of Claim *

Comcast Sports Management Services LLC, One Comcast Center, Philidelphia, PA 19103

Services Fees
Nature of Claim

Name and Address of Petitioner


Houston SportsNet Finance LLC, One Comcast Center, 1701 JFK Blvd. Philidelphia, PA 19103

Money Loaned

100,000,000.00
Total Amount of Petitioners Claims

Note:

If there are more than three petitioners, attach additional sheets with the statement under penalty of perjury, each petitioners signature under the statement and the name of attorney and petitioning creditor information in the format above. 2 ______continuation sheets attached

101,305,220.27

* Please see attached sheet.


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Case 13-35998 Document 1 Filed in TXSB on 09/27/13 Page 3 of 5

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : : Attachment A Petitioner declares under penalty of perjury that the foregoing is true and correct according to the best of his knowledge, information and belief.

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-

x_/s/ John C. Ruth_____________________________ Signature of Petitioner or Representative EVP, Finance__________________________________ Title ___09/27/2012 Date Signed Comcast SportsNet California, LLC 4450 East Commerce Way Sacramento, CA 95834

x_/s/ Vincent. P. Slusher __ Signature of Attorney ___09/27/2012 Date Signed DLA Piper LLP (US) 1717 Main Street Suite 4600 Dallas, Texas 75201-4629

Case 13-35998 Document 1 Filed in TXSB on 09/27/13 Page 4 of 5

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : :

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-

Attachment B Involuntary Petition Petitioning Creditors Name and Address of Petitioning Creditor Nature of Claim $10,517.50 This is the amount due for services provided. This claim is unsecured. Amount of Claim

National Digital Television Center, Services Rendered LLC 4100 E. Dry Creek Road Centennial, CO 80122 Comcast Sports Management Services, LLC One Comcast Center Philidelphia, PA 19103 Houston SportsNet Finance, LLC One Comcast Center 1701 JFK Blvd. Philidelphia, PA 19103 Money Loaned Services Fees

$1,251,573.75 Unpaid amount for management services rendered through September 27, 2013. This claim is unsecured. $100,000,000 This is the USD principal amount of the applicable loan and does not include accrued and unpaid interest, fees, and other amounts. The loan is secured by all assets of the alleged debtor.

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Comcast SportsNet California, LLC 4450 East Commerce Way Sacramento, CA 95834

Services Rendered

$43,129.02 This is the amount due for services provided. This claim is unsecured.

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Case 13-35998 Document 2 Filed in TXSB on 09/28/13 Page 1 of 7

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : :

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-35998

EMERGENCY MOTION TO FILE REDACTED VERSIONS OF MOTION OF PETITIONING CREDITORS FOR APPOINTMENT OF INTERIM CHAPTER 11 TRUSTEE AND SUPPORTING DECLARATIONS THE COURT WILL CONDUCT A HEARING IN THIS MATTER AT A TIME TO BE DETERMINED BY THE COURT IN THE U. S. COURTHOUSE, 515 RUSK, HOUSTON, TEXAS, 77002. BLR 9013-1(i) NOTICE: EMERGENCY RELIEF HAS BEEN REQUESTED. IF THE COURT CONSIDERS THE MOTION ON AN EMERGENCY BASIS, THEN YOU WILL HAVE LESS THAN 21 DAYS TO ANSWER. IF YOU OBJECT TO THE REQUESTED RELIEF OR IF YOU BELIEVE THAT THE EMERGENCY CONSIDERATION IS NOT WARRANTED, YOU SHOULD FILE AN IMMEDIATE RESPONSE. BLR 9013-1(b) NOTICE: THIS MOTION SEEKS AN ORDER THAT MAY ADVERSELY AFFECT YOU. IF YOU OPPOSE THE MOTION, YOU SHOULD IMMEDIATELY CONTACT THE MOVING PARTY TO RESOLVE THE DISPUTE. IF YOU AND THE MOVING PARTY CANNOT AGREE, YOU MUST FILE A RESPONSE AND SEND A COPY TO THE MOVING PARTY. YOU MUST FILE AND SERVE YOUR RESPONSE WITHIN 21 DAYS OF THE DATE THIS WAS SERVED ON YOU. YOUR RESPONSE MUST STATE WHY THE MOTION SHOULD NOT BE GRANTED. IF YOU DO NOT FILE A TIMELY RESPONSE, THE RELIEF MAY BE GRANTED WITHOUT FURTHER NOTICE TO YOU. IF YOU OPPOSE THE MOTION AND HAVE NOT REACHED AN AGREEMENT, YOU MUST ATTEND THE HEARING. UNLESS THE PARTIES AGREE OTHERWISE, THE COURT MAY CONSIDER EVIDENCE AT THE HEARING AND MAY DECIDE THE MOTION AT THE HEARING. Houston SportsNet Finance, LLC, Comcast Sports Management Services, LLC, National Digital Television Center, LLC, and Comcast SportsNet California, LLC (collectively, the Petitioning Creditors) hereby move, pursuant to 11 U.S.C. 107(b)(1) and Federal Rule of Bankruptcy Procedure 9018, for leave to redact confidential commercial information from the

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publicly filed version of their motion to appoint an interim chapter 11 trustee, and supporting declarations (the Trustee Motion and Supporting Declarations). In support hereof, the Petitioning Creditors respectfully state as follows: JURISDICTION AND VENUE 1. This Court has jurisdiction over the subject matter of this motion pursuant to 28

U.S.C. 157 and 1334. This matter is a core proceeding under 28 U.S.C. 157(b). Venue is proper in this District pursuant to 28 U.S.C. 1408 and 1409. BACKGROUND 2. On September 27, 2013, the Petitioning Creditors filed an involuntary Chapter 11

bankruptcy petition against Houston Regional Sports Network, L.P. (the Alleged Debtor or Network) pursuant to Section 303(a) of the Code. On September 28, 2013, the Petitioning Creditors filed a redacted version of the Trustee Motion with its Supporting Declarations along with this Motion. In the Trustee Motion, the Petitioning Creditors seek an order appointing an interim Chapter 11 trustee for cause or in the best interest of the estate because of a present, debilitating deadlock in the Networks management. 3. The Alleged Debtor is a joint enterprise among affiliates of the Houston Astros

baseball team (Astros), the Houston Rockets basketball team (Rockets), and Houston SportsNet Holdings, LLC (Comcast Owner), an affiliate of Comcast Corporation (together with its affiliates, Comcast). 4. The Network has three limited partnersComcast Owner, Rockets Partner, L.P.

(Rockets Partner), and Astros HRSN LP Holdings LLC (Astros Partner). The Network also has one general partnerHouston Regional Sports Network, LLC (the General Partner) which, subject to certain limitations, exercises exclusive management, supervision, and control

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over the Networks properties and business. The General Partners sole purpose is to serve as the Networks general partner; it has no authority or power to act outside of that role. The General Partner has three membersComcast Owner, JTA Sports, Inc. (Rockets Owner) , and Astros HRSN GP Holdings LLC (Astros Owner). Thus, whether as limited partners of the Network or members of the General Partner, affiliates of the Rockets, the Astros, and Comcast are the three owners and operators of the Network. 5. As a result of fundamental disagreement among those owners about the direction

and management of the Network, the Alleged Debtor faces an urgent financial and corporate governance crisis. The Network cannot pay its bills as they come due, cannot raise capital, and cannot make key business decisions. To avoid the destruction of the Networks substantial value, the Petitioning Creditors, through the Trustee Motion, seek the appointment of a Chapter 11 trustee on an emergency basis. 6. The Trustee Motion and Supporting Declarations contain sensitive and

confidential commercial information relating to confidential communications and pricing information among and between Comcast, the Network, the Astros, and the Rockets (the Confidential Commercial Information). Specifically, the Confidential Commercial Information includes: a. pricing and other terms of media rights agreements between the Network and each of the Astros and Rockets; b. pricing and other terms of a credit agreement between the Network and the Comcast Lender; c. pricing and other terms for oversight and operational services that Comcast Sports Management Services, LLC provides to the Network;

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d. sensitive business negotiations relating to prior efforts among the parties to address the Networks financial distress; and e. confidential information of the Alleged Debtor. RELIEF REQUESTED AND BASIS FOR SUCH RELIEF 7. The Petitioning Creditors request the Court to (i) authorize, pursuant to section

107(b) of the Bankruptcy Code and Bankruptcy Rule 9018, the Petitioning Creditors redaction of the Confidential Commercial Information from the Trustee Motion and Supporting Declarations, and (ii) permit the Petitioning Creditors to file a redacted version of the Trustee Motion and Supporting Declarations on the electronic docket maintained in these chapter 11 cases. Additionally, the Petitioning Creditors request leave to provide (i) an unredacted copy of the Trustee Motion and Supporting Declarations under seal with the Clerk of the Court and (ii) copies of the unredacted Trustee Motion and Declarations, on a confidential basis, to the Court, the United States Trustee for the Southern District of Texas, the Alleged Debtor, the Rockets, and the Astros. 8. Section 107(b) of the Bankruptcy Code authorizes the Court to issue orders to

protect entities from potential harm caused by the disclosure of confidential or sensitive commercial information. See In re N. Bay Gen. Hosp., 404 B.R. 429, 438 (Bankr. S.D. Tex. 2009); In re Supplement Spot, LLC, 2009 WL 2006384, at *11 (Bankr. S.D. Tex. July 8, 2009). Specifically, Section 107(b) provides: On request of a party in interest, the bankruptcy court shall, and on the bankruptcy courts own motion, the bankruptcy court may (l) protect an entity with respect to a trade secret or confidential research, development, or commercial information . . . 11 U.S.C. 107(b)(1).

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9.

Bankruptcy Rule 9018 sets forth the procedures by which a party may move for

relief under Section 107(b) and states: On motion or on its own initiative, with or without notice, the court may make any order which justice requires ... to protect the estate or any entity in respect of a trade secret or other confidential research, development, or commercial information . . . Fed. R. Bankr. P. 9018. 10. The purpose of Section 107 and Bankruptcy Rule 9018 is to protect business

entities from disclosure of information that could reasonably be expected to cause the entity commercial injury. In re Global Crossing, Ltd., 295 B.R. 720, 725 (Bankr. S.D.N.Y. 2003). A party seeking such protection under Section 107(b) is not required to demonstrate good cause. In re Faucett, 438 B.R. 564, 568 (Bankr. W.D. Tex. 2010) (citing In re Orion Pictures Corp., 21 F.3d 24, 28 (2d Cir. 1994)). Nor must an entitys business information rise to the level of trade secrets to be protected under Section 107(b). Orion, 21 F.3d at 28. Rather, if the material sought to be protected satisfies one of the categories identified in Section 107(b), the court is required to protect a requesting party and as no discretion to deny the application. Faucett, 438 B.R. at 567. 11. The Confidential Commercial Information that the Petitioning Creditors seek to

protect falls squarely within the definition of confidential commercial information under Section 107(b). Commercial information includes information which would cause an unfair advantage to competitors by providing them information as to the commercial operations of the debtor. In re Northstar Energy, Inc., 315 B.R. 425, 429 (Bankr. E.D. Tex. 2004) (quoting Orion, 21 F.3d at 27). While the commercial information exception is not intended to offer a safe harbor for those who crave privacy, it will protect[] parties from the release of information that could cause them harm or give competitors an unfair advantage. In re Barneys, Inc., 201

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B.R. 703, 709 (Bankr. S.D.N.Y. 1996) (section 107 protects, inter alia, terms of agreements with suppliers, pricing formulae, and marketing strategies). See also In re Taiyo Corp., No. 9341092, 1993 WL 13003867 *2 (Bankr. S.D. Ga. Sept. 30, 1993) (sealing information in an appraisal that could affect the market and finding that commercial information includes more than just information that gives competitors an unfair advantage) (citing In re Lomas Financial Corp., No. 90-7827, 1991 WL 21231 (S.D.N.Y. Feb. 11, 1991)). That is precisely the case here. 12. The Confidential Commercial Information contains confidential pricing and other

terms and private commercial operations information that, if disclosed, could give competitors an unfair advantage or otherwise cause financial harm to the Network, the Astros, the Rockets, and the Petitioning Creditors. 13. Moreover, the Petitioning Creditors submit that the benefits to the estate of filing

redacted versions of the Trustee Motion and Supporting Declarations outweigh any presumed benefit of public access to court records, Faucett, 438 B.R. at 568indeed the public is unaffected by the redaction of the Confidential Commercial Information.

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CONCLUSION For the foregoing reasons, the Petitioning Creditors respectfully request entry of an order granting the relief requested herein and such other and further relief as the Court may deem appropriate. Respectfully submitted,

Howard M. Shapiro Craig Goldblatt Jonathan Paikin WILMER CUTLER PICKERING HALE AND DORR LLP 1875 Pennsylvania Ave., N.W. Washington, D.C. 20006 (202) 663-6000 George W. Shuster, Jr. WILMER CUTLER PICKERING HALE AND DORR LLP 7 World Trade Center 250 Greenwich Street New York, NY 10007 (212) 230-8800

/s/ Vincent P. Slusher Vincent P. Slusher Andrew Zollinger DLA PIPER 1717 Main Street Suite 4600 Dallas, Texas 75201-4629 (214) 743-4500 Arthur J. Burke Dana M. Seshens Timothy Graulich DAVIS POLK & WARDWELL LLP 450 Lexington Avenue New York, NY 10017 (212) 450-4000

Counsel for the Petitioning Creditors

Dated: September 28, 2013

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IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : :

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-35998

EMERGENCY MOTION OF PETITIONING CREDITORS FOR APPOINTMENT OF INTERIM CHAPTER 11 TRUSTEE THE COURT WILL CONDUCT A HEARING IN THIS MATTER AT A TIME TO BE DETERMINED BY THE COURT IN THE U. S. COURTHOUSE, 515 RUSK, HOUSTON, TEXAS, 77002. BLR 9013-1(i) NOTICE: EMERGENCY RELIEF HAS BEEN REQUESTED. IF THE COURT CONSIDERS THE MOTION ON AN EMERGENCY BASIS, THEN YOU WILL HAVE LESS THAN 21 DAYS TO ANSWER. IF YOU OBJECT TO THE REQUESTED RELIEF OR IF YOU BELIEVE THAT THE EMERGENCY CONSIDERATION IS NOT WARRANTED, YOU SHOULD FILE AN IMMEDIATE RESPONSE. BLR 9013-1(b) NOTICE: THIS MOTION SEEKS AN ORDER THAT MAY ADVERSELY AFFECT YOU. IF YOU OPPOSE THE MOTION, YOU SHOULD IMMEDIATELY CONTACT THE MOVING PARTY TO RESOLVE THE DISPUTE. IF YOU AND THE MOVING PARTY CANNOT AGREE, YOU MUST FILE A RESPONSE AND SEND A COPY TO THE MOVING PARTY. YOU MUST FILE AND SERVE YOUR RESPONSE WITHIN 21 DAYS OF THE DATE THIS WAS SERVED ON YOU. YOUR RESPONSE MUST STATE WHY THE MOTION SHOULD NOT BE GRANTED. IF YOU DO NOT FILE A TIMELY RESPONSE, THE RELIEF MAY BE GRANTED WITHOUT FURTHER NOTICE TO YOU. IF YOU OPPOSE THE MOTION AND HAVE NOT REACHED AN AGREEMENT, YOU MUST ATTEND THE HEARING. UNLESS THE PARTIES AGREE OTHERWISE, THE COURT MAY CONSIDER EVIDENCE AT THE HEARING AND MAY DECIDE THE MOTION AT THE HEARING. Houston SportsNet Finance, LLC, Comcast Sports Management Services, LLC, National Digital Television Center, LLC, and Comcast SportsNet California, LLC. (collectively, the Petitioning Creditors) hereby move, pursuant to 11 U.S.C. 1104, for the appointment of an interim trustee in this Chapter 11 case to administer the affairs of the alleged debtor, Houston Regional Sports Network, L.P. (the Alleged Debtor or Network), the corporate general

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partner of which is Houston Regional Sports Network, LLC (General Partner), because of a present, debilitating deadlock in the General Partners, and hence the Networks, management. In support hereof, the Petitioning Creditors rely on the Declarations of Robert S. Pick, Jon D. Litner, Bruce A. Davis, and John C. Ruth, attached hereto as Exhibits A through D, and further respectfully state as follows: JURISDICTION AND VENUE 1. This Court has jurisdiction over the subject matter of this motion pursuant to 28

U.S.C. 157 and 1334. This matter is a core proceeding under 28 U.S.C. 157(b). Venue is proper in this District pursuant to 28 U.S.C. 1408 and 1409. 2. The statutory basis for the relief requested herein is section 1104 of the

Bankruptcy Code (the Code). INTRODUCTION 3. The Alleged Debtor is a joint enterprise among affiliates of the Houston Astros

baseball team (Astros), the Houston Rockets basketball team (Rockets), and Houston SportsNet Holdings, LLC (Comcast Owner), an affiliate of Comcast Corporation (together with its affiliates, Comcast). The primary purpose of the enterprise was to create and operate a regional sports programming service (Service) to exhibit and distribute live Astros and Rockets games within the league-permitted local territories. As a result of fundamental disagreement among the partners about the direction and management of the Network, the Alleged Debtor faces an urgent financial and corporate governance crisis. The Network cannot pay its bills as they come due, cannot raise capital, and cannot make key business decisions.

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As a result, and as set forth further below, to avoid the destruction of the Networks substantial value, the Alleged Debtor requires the appointment of a Chapter 11 trustee on an emergency basis. 4.

5.

For months, the parties to the enterprise have struggled to reach agreement on

action that would have avoided this bankruptcy proceeding.

But as a

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result of the impasse among the parties, the Network is now insolvent. As a result, after many efforts to avoid this day, the Petitioning Creditorseach an affiliate of Comcast, but each a separate entity that holds a claim not subject to bona fide disputehave filed this involuntary bankruptcy case. 6. The Network does have assetsincluding the right to telecast Astros and Rockets

games, the right to receive monthly fees under an affiliation agreement with Comcast Cable Communications, LLC (Comcast Cable) for distribution of the Networks Service, and rights to receive revenue from a few smaller operators that carry the Service. These assets have significant value, the protection of which is the central purpose of this involuntary bankruptcy filing. 7. Houston SportsNet Finance, LLC (Comcast Lender), the Networks secured

lender, believes the Networks assets have meaningful value, and would be prepared to make a bid to acquire either the Network (under a plan of reorganization) or substantially all of its assets. Comcast Lender believes that such a transactionif it were to close by the end of the calendar year, and based on the Networks indebtedness of which it is presently aware and that which it anticipates the Network would incur by year endwould likely lead to prepetition creditors claims and all reasonably foreseeable administrative expenses being paid in full, and a material distribution to equity holders. Comcast Lender of course appreciates that any such transaction would need to be negotiated with and acceptable to the chapter 11 trustee, subject to an open auction process, and ultimately approved by this Court. In addition, Comcast Lender stands prepared, if requested by a Chapter 11 Trustee, to negotiate over the terms of possible debtor-inpossession financing necessary to finance the Networks operations until a sale can be consummated.

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8.

Petitioning Creditors are thus by no means seeking to dictate or asking this Court

itself to determine how those assets will be restructured, liquidated, or otherwise treated. Rather, they are asking this Court to appoint an independent and disinterested Trustee who will owe a fiduciary duty to the Alleged Debtors estate, and who will be well equipped to make those decisions for the otherwise hamstrung Alleged Debtor. Absent the appointment of a Trustee, the substantial value that is currently locked up as a result of the dysfunction in the Alleged Debtors governance structure will likely be lostand lost foreverin the immediate future. 9. This Court has discretion to appoint an interim Chapter 11 trustee for cause or if

such appointment is the best interest of the estate. 11 U.S.C. 1104(a). Courts find cause justifying the appointment of a Chapter 11 trustee where there are inherent conflicts of interests such that the parties are working at cross purposes, In re Marvel Entmt Grp., Inc., 140 F.3d 463, 473 (3d Cir. 1998) (quoting In re Cajun Elec. Power Coop., Inc., 74 F.3d 599 (5th Cir. 1996)). In addition, when the board of directors of a debtor corporation is effectively deadlocked, appointment of a trustee is in the best interests of the bankruptcy estate. In re New Orleans Paddlewheels, Inc., 350 B.R. 667, 692 (Bankr. E.D. La. 2006). Thus, although the appointment of a Chapter 11 trustee on an emergency basis is an extraordinary remedy, this case presents precisely the type of exceptional circumstance in which such relief is necessary and appropriate. BACKGROUND 10. The Network is a Delaware limited partnership. It is the owner and operator of

the Service, a Houston-area regional sports television network that produces and distributes sports programming on a full time basis.

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I.

The Network 11. The Network has three limited partnersComcast Owner, Rockets Partner, L.P.

(Rockets Partner), and Astros HRSN LP Holdings LLC (Astros Partner). The Network also has one general partnerHouston Regional Sports Network, LLC (the General Partner) which, subject to certain limitations, exercises exclusive management, supervision, and control over the Networks properties and business. The General Partners sole purpose is to serve as the Networks general partner; it has no authority or power to act outside of that role. The General Partner has three membersComcast Owner, JTA Sports, Inc. (Rockets Owner) 1, and Astros HRSN GP Holdings LLC (Astros Owner) 2. Thus, whether as limited partners of the Network or members of the General Partner, affiliates of the Rockets, the Astros, and Comcast are the three (and the only three) owners and operators of the Network. 12.

13.

In October of 2010, the Astros and the Rockets reached an agreement with an

affiliate of Comcast for the purpose of launching the Service, a new regional sports programming network that would distribute the teams games and other team-related programming within the league-permitted local territories. On October 29, 2010, after lengthy negotiations among Comcast, the Rockets and the Astros, including then-Astros-owner Drayton McLane, the parties Rockets Partner, Rockets Owner, and Rocket Ball, Ltd. d/b/a the Houston Rockets (Rockets Team) are collectively referred to herein as Rockets. The Rockets Team is a professional basketball franchise in the National Basketball Association. Astros Partner, Astros Owner, and Houston Astros, LLC (Astros Team) are collectively referred to herein as Astros. The Astros Team is a professional baseball franchise in Major League Baseball.
2 1

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entered into the Networks and General Partners operating agreements and other integrated transaction documents (the Transaction Documents), pursuant to which Comcast was admitted as a limited partner of the Network and as a member of the General Partner. As described in greater detail below, the transaction also provided for, among other things, the Networks right to exploit the Rockets and Astros media rights, to receive management oversight and operational services from Comcast Sports Management Services, LLC (Comcast Services), to be carried on local cable systems owned by Comcast Cable under an affiliation agreement, and to borrow up to $100 million from Comcast Lender. II. The Petitioning Creditors and the Networks Inability to Pay Its Debts As They Become Due 14. As set forth in the Declaration of Jon D. Litner (Litner Declaration) as part of

the October 2010 transaction, the Network entered into an amended and restated media rights agreement with each of the Astros and the Rockets (the Astros Media Rights Agreement and the Rockets Media Rights Agreement, respectively),

15.

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16.

17.

As set forth in the Declaration of Robert S. Pick, the Network also entered into an

agreement (the Credit Agreement) with Comcast Lender

18.

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As of May 29, 2013, the Comcast Loan has been fully drawn. Thus, the aggregate principal balance of the Comcast Loan is currently $100 million.

19.

As set forth in the Litner Declaration, on October 29, 2010, the Network also

entered into an agreement (the Services Agreement) with Comcast Services, pursuant to which Comcast Services agreed to provide the Network with management oversight and various defined Operational Services in exchange for an annual fee (the Service Fee)

The pro-rated amount due as of the filing of the involuntary petition is $1,251,573.75. 20. As set forth in the Declaration of Bruce A. Davis, National Digital Television

Center, LLC provides transmission related services to the Network. As of the date of the filing

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of the involuntary petition, it holds an unsecured claim against the Network for $10, 517.50 for services provided. 21. As set forth in the Declaration of John C. Ruth, Comcast SportsNet California,

LLC facilitates the provision of production services to the Network. As of the date of the filing of the involuntary petition, it holds an unsecured claim against the Network for $43,129.02. 22.

23.

24.

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Case 13-35998 Document 3 Filed in TXSB on 09/28/13 Page 11 of 25

25.

26.

27.

III.

Failure of Management 28. The General Partner is managed by a Board of Directors (the GP Board) that is

comprised of one representative each from the Astros and the Rockets and two representatives from Comcast. Effectively, the GP Board manages the Network, pursuant to the Second Amended and Restated Limited Liability Company Agreement of the General Partner, dated

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Case 13-35998 Document 3 Filed in TXSB on 09/28/13 Page 12 of 25

October 29, 2010 and executed by and among the members of the General Partner (the GP Operating Agreement).

29.

As further described herein, however, the GP Board is simply unable to reach the requisite consent on most key decisions. As a result, it has become effectively impossible for the Network to operate, thus precipitating the Networks current financial distress. A. 30. Inability to Enter Into Affiliation Agreements Regional sports networks like the Network generate the vast majority of their

revenue by entering into affiliation agreements with MVPDs that agree to carry the network in exchange for per-subscriber fees, such as the Comcast Cable Agreement. 31. Back in October 2010, in conjunction with the negotiation of the other

Transaction Documents, the Rockets and Astros negotiated directly with Comcast Cable regarding the terms and rates that it would agree to with respect to its carriage of the Networks Service.

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Case 13-35998 Document 3 Filed in TXSB on 09/28/13 Page 13 of 25

32.

33.

On November 17, 2011, Jim Crane and a group of investors (the Crane

Ownership Group) purchased the Astros from Drayton McLane, including the Astros interest

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in the Network and its General Partner. 34.

35.

B. 36.

The Failure of Efforts to Fund or Restructure the Network With the GP Board at a complete impasse, the Network is powerless to continue

its affairs and pay its debts.

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Case 13-35998 Document 3 Filed in TXSB on 09/28/13 Page 15 of 25

As described in greater detail below, the deadlock among the parties has thwarted all efforts to engage in any constructive exercise to salvage the Network. 37.

38.

39.

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40.

41.

. Accordingly, the question before this Court is by no means who is right or wrong in the various disagreements that have arisen among the parties. This bankruptcy filing is not an effort to have this Court adjudicate any such dispute. Rather, regardless of who is to blame, the point of this proceeding is to preserve

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Case 13-35998 Document 3 Filed in TXSB on 09/28/13 Page 17 of 25

the going concern value of the Network for the benefit of all of its constituenciesan objective that manifestly cannot be achieved by any means other than through the bankruptcy process. III. The Involuntary Petition 42. On September 27, 2013, the Petitioning Creditors filed an involuntary Chapter 11

bankruptcy petition against the Network pursuant to section 303(a) of the Code. Pursuant to Bankruptcy Rule 1011(b), the Networks response to the petition is due on October 18, 2013. RELIEF REQUESTED 43. The Petitioning Creditors seek the entry of an order, pursuant to section 1104 of

the Code directing the Office of the U.S. Trustee to appoint an interim trustee in this Chapter 11 case. ARGUMENT 44. Section 303(f) of the Code provides that a debtor in an involuntary case will

continue to operate its business as a debtor-in-possession absent an order of the court. Indeed, there is a strong presumption that a debtor should remain in possession of its estate and control its affairs. See In re Sharon Steel Corp., 871 F.2d 1217, 1225 (3d Cir. 1989). That presumption only holds true, however, if management, among other things, is free from conflicts and not effectively deadlocked. See Marvel Entmt, 140 F.3d at 474; New Orleans Paddlewheels, 350 B.R. at 692. 45. 11 U.S.C. 1104which allows for the appointment of a trustee in a Chapter 11

caseprovides an important protection that the Court should not lightly disregard or encumber with overly protective attitudes towards debtors-in-possession. In re Colorado-Ute Elec. Assn, Inc., 120 B.R. 164, 173-74 (Bankr. D. Co. 1990). It provides: (a) At any time after the commencement of the case but before confirmation of a plan, on request of a party in interest or the United States trustee, and after notice

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and a hearing, the court shall order the appointment of a trustee (1) for cause, including fraud, dishonesty, incompetence, or gross mismanagement of the affairs of the debtor by current management, either before or after the commencement of the case, or similar cause, but not including the number of holders of securities of the debtor or the amount of assets or liabilities of the debtor; or (2) if such appointment is in the interests of creditors, any equity security holders, and other interests of the estate, without regard to the number of holders of securities of the debtor or the amount of assets or liabilities of the debtor. 11 U.S.C. 1104(a). 46. Section 1104 thus establishes two independent grounds for the appointment of a

Chapter 11 trustee: It provides for the mandatory appointment of a trustee for cause; and it grants the court discretion to appoint a trustee in the absence of cause when the appointment is in the best interests of creditors. 11 U.S.C. 1104(a)(1),(2). A party moving for a trustees appointment may establish the need for a trustee under either ground by clear and convincing evidence. Marvel Entmt, 140 F.3d at 471. 47. As set forth more fully below, the facts here warrant the appointment of a Trustee

on both grounds. The total gridlock in the GPs Board and thus the Networks management provides cause for a trustees appointment. Each member of the General Partner is an affiliate of an important creditor and contractual counterparty of the Network. And there is no question that if the existing corporate governance structure remains in place, the Network will remain encumbered by management deadlock and paralysis and the Network will be unable to take actions necessary to operate its business affairs for the benefit of creditors and other stakeholders. Accordingly, the best interest of the Networks other constituencies will be served by the appointment of an independent interim chapter 11 trustee.

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I.

The Network is a Proper Involuntary Debtor under 11 U.S.C. 303 48. By its terms, Section 1104 applies at any time after commencement of the

case[,] and therefore may be invoked during the gap period in an involuntary case. See In re Profl Accountants Referral Servs., Inc., 142 B.R. 424, 429 (Bankr. D. Colo. 1992) ([T]he appointment of a trustee during the gap periodbefore an order for relief is enteredis authorized and proper under 11 U.S.C. 1104(a)(1), 105, and by analogy, 303(g).). 49. Before a court may order a trustees appointment during the gap period, the

movant must show as a threshold matter, a reasonable likelihood, or probability, that this Debtor will eventually be found to be a proper involuntary debtor under 11 U.S.C. 303 and that an order for relief will enter. Profl Accountants, 142 B.R. at 429. That test is fully satisfied here. 50. Under Section 303(b)(1), an involuntary petition may be commenced by three or

more entities, each of which is a holder of a claim against such person that is not contingent as to liability or the subject of a bona fide dispute as to liability or amount, if such noncontingent, undisputed claims aggregate at least $15,325 more than the value of any lien on property of the debtor securing such claims held by the holders of such claims. 11 U.S.C. 303(b)(1). As described above, the four Petitioning Creditors collectively hold claims against the Network in the amount of $101,305,220.27, of which $1,305,220.77 is unsecured. 3 As set forth in the attached Declarations, these obligations are not contingent or subject to a bona fide dispute. Nor are there legal or factual questions regarding the Networks liability to the Petitioning Creditors, or the amount of their claims. Comcast Lender is a valid petitioning creditor under Section 303(b)(1) even if its claim is fully secured. See Paradise Hotel Corp. v. Bank of Nova Scotia, 842 F.2d 47, 50 (3d Cir. 1988) (fully secured creditor may be one of the three creditors filing an involuntary petition, so long as the total unsecured debt of the petitioning creditors satisfies the statutory amount of Section 303(b)(1)). -193

Case 13-35998 Document 3 Filed in TXSB on 09/28/13 Page 20 of 25

51.

Nor can there be any dispute that the Network is generally not paying [its] debts

as [they] become due. 11 U.S.C. 303(h)(1). The Networks largest matured debtsthe July and August installment payments to the Astrosremain unpaid and are by themselves more than sufficient to meet this standard. See In re Fischer, 202 B.R. 341, 350-51 (E.D.N.Y. 1996). Moreover, the Network has insufficient funds to make installment media rights payments that will come due and owing to Astros and Rockets in the next 60 days. Accordingly, the statutory standards are readily satisfied. II. There is Cause to Appoint a Chapter 11 Trustee 52. The facts in this case warrant the appointment of an interim trustee under 11

U.S.C. 1104(a). While section 1104(a) enumerates four bases on which a court may find causefraud, dishonesty, incompetence, and gross mismanagementthose grounds are illustrative, not exclusive, see Colorado-Ute, 120 B.R. at 174 (citing In re Oklahoma Refining Co., 838 F.2d 1133, 1136 (10th Cir. 1988)), and this Court has broad discretion when determining whether the facts before it constitute cause. See, e.g., In re Cardinal Industr., 109 B.R. 755 (Bankr. S.D. Ohio 1990) (finding the cumulative effect of various events that caused a loss of confidence in the debtors management to be cause for the appointment of a trustee); Colorado-Ute, 120 B.R. at 175 (appointing a trustee because of conflicts between the debtors management and its creditors). 4 53. [M]ere conflicts or acrimony between debtor and creditor do not automatically

mandate the appointment of a trustee[;] however, courts routinely find cause when there are inherent conflicts [that] extend beyond the healthy conflicts that always exist between debtor and creditor, or ... when the parties begin working at cross-purposes. Marvel Entmt, 140 F.3d If the court finds cause for the appointment of a trustee, the Court has no discretion, but must appoint a trustee. Colorado-Ute, 120 B.R. at 174.
4

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at 471-73 (affirming appointment of chapter 11 trustee where controlling shareholder group that took over debtor management in an hostile manner post-petition also controlled creditors of the debtor, and extreme acrimony existed between controlling shareholder group and other creditors of the debtor who had opposed the takeover) (citing In re Cajun Elec. Power Coop., Inc., 74 F.3d 599 (5th Cir. 1996) (adopting on rehearing the dissents opinion in 69 F.3d at 751)). See also In re New Towne Dev., LLC, 404 B.R. 140, 149 (Bankr. M.D. La. 2009) (appointing chapter 11 trustee where members of debtors management were engaged in disputes and half of debtors management owned debtors principal creditor). 54. In Cajun Electric, for example, the Fifth Circuit upheld the appointment of a

Chapter 11 trustee based on the debtors acrimonious relations with creditors and its boards irremediable conflicts. In re Cajun Elec., 74 F.3d at 599 (adopting on rehearing the dissents opinion in 69 F.3d 746, 751). There, the Louisiana Public Service Commission (LPSC) had ordered Cajun to lower its electricity rates, making it impossible for the company to meet its debt obligations. In re Cajun Elec., 69 F.3d 746, 747 (5th Cir. 1995). Cajuns board members had to decide whether to appeal the LPSC order; however, many of its members were managers or board members of Cajuns electric cooperatives, which cooperatives bought electricity from Cajun. Id. Therefore, if those members voted to appeal the rate decrease, they would effectively be voting to raise the prices of electricity for the cooperatives. Id. The court concluded that appointment of Chapter 11 trustee was appropriate because the debtor-creditor conflict went beyond the inherent conflicts under which all healthy cooperatives operate. Id. at 751. Indeed, it noted that members of the board had been working at cross-purposes, mandating an appointment [as] the only effective way to pursue a reorganization. Id.

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55.

As described above, the corporate governance crisis facing the Alleged Debtor

has created total gridlock.

Whatever the reasons for the deadlock and regardless of who is to blame, it cannot be disputed that the key constituencies of the Alleged Debtor are now unable to take the actions necessary to preserve the Network as a going concern. The conflicts go beyond mere acrimony: the General Partners Board has been, and unless effectively replaced by a Chapter 11 trustee, will continue to be working at cross-purposes. Cajun Elec., 69 F.3d at 751. There is thus cause to appoint an interim trusteeindeed, it is the only effective way to pursue a reorganization. Id. III. The Appointment of a Trustee is in The Best Interests of Creditors 56. Even if this Court were not to find cause under section 1104(a)(1), the

appointment of an interim trustee is appropriate under section 1104(a)(2). Section 1104(a)(2) authorizes the appointment of a trustee if the appointment is in the best interests of creditors, and gives the courts broader discretion than subsection (a)(1). Marvel Entmt, 140 F.3d at 474 ( 1104(a)(2) envisions a flexible standard); see also In re Bellevue Place Associates, 171 B.R. 615, 623 (Bankr. N.D. Ill. 1994), affd, 1994 U.S. Dist. LEXIS 17409 (N.D. Ill. Dec. 6, 1994); In re Microwave Products of America, Inc., 102 B.R. 666, 675 (Bankr. W.D. Tenn. 1989) (appointment of trustee was in the best interests of creditors where ineffective management created a lack of creditor confidence and internal conflicts). 57. To determine best interests of creditors, courts resort to broad equity powers.

Equitable remedies are a special blend of what is necessary, what is fair, and what is workable.

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In re Hotel Assocs., Inc., 3 B.R. 343, 345 (Bankr. E.D. Pa. 1980). Applying those powers to appoint a trustee under section 1104(a)(2), courts eschew rigid absolutes and look to the practical realities and necessities inescapably involved in reconciling competing interests. Id. 58. Courts have long recognized that a trustee should be appointed under section

1104(a)(2) if the debtor and/or its key constituencies have conflicts that would prevent a debtorin-possession from managing the business in the best interests of creditors. See Marvel Entmt, 140 F.3d at 474; In re L.S. Good & Co., 8 B.R. 312, 315 (Bankr. N.D. W. Va. 1980) (appointing trustee was in best interest of creditors where current management would result in conflict). [W]hen the board of directors of a debtor corporation is effectively deadlocked, appointment of a trustee is in the best interests of the bankruptcy estate. New Orleans Paddlewheels, 350 B.R. at 692 (citing Matter of Tahkenitch Tree Farm Pship, 156 B.R. 525 (Bankr. E.D. La. 1993)). 59. It is clear that the Network cannot operate its business or preserve itself as a going

concern under its current corporate governance structure, which has resulted in an irreconcilable impasse, Where, as here, management is deadlocked, the appointment of a trustee is the best (and only) recourse to ensure reorganization and payments to creditors. See Marvel Entmt, 140 F.3d at 474 ([T]he selection of a plan is in the best interests of all creditors, and the best way to achieve that result is to appoint a trustee.); see also In re Colorado-Ute, 120 B.R. at 176 (appointment in best interests where serious conflicts between and among the debtor, its board and creditors make the prospect for gridlock seem more probable than the ability to rehabilitate the debtor). 60. In addition, there are likely few other creditors in the case who would be

adversely affected by the costs of a Chapter 11 trustee. See In re Sundale, Ltd., 400 B.R. 890,

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901 (Bankr. S.D. Fla. 2009) (explaining that in deciding whether to appoint trustee, court should consider the costs to creditors); In re Sharon Steel Corp., 86 B.R. 455, 466 (Bankr. W.D. Pa. 1988) (In a case of this magnitude, the cost of having a trustee in place is insignificant when compared with the other costs of administration and when compared with the enormous benefit to be achieved by the establishment of trust and confidence in ... management.). And in any event, any potential costs are clearly outweighed by the benefits of having an interim trustee set the Network back on whatever forward-looking track that trustee determines most appropriate. Moreover, as described above, because Comcast is prepared to negotiate with a trustee toward a proposal that allow creditors and administrative claimants to be paid in full, and material value to be distributed to equity holders, there can be little question that the appointment of a trustee would serve the estates interests. As the Bankruptcy Court in the Eastern District of Louisiana has stated, Without a board to approve a plan, none can be formulated or proposed. Without a plan, this debtor may not emerge from bankruptcy and the creditors [cannot] be paid. New Orleans Paddlewheels, 350 B.R. at 692. Precisely the same is true here.

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CONCLUSION For the foregoing reasons, the Petitioning Creditors respectfully request that the Court order the appointment of an interim Chapter 11 trustee.

Respectfully submitted,

Howard M. Shapiro Craig Goldblatt Jonathan Paikin WILMER CUTLER PICKERING HALE AND DORR LLP 1875 Pennsylvania Ave., N.W. Washington, D.C. 20006 (202) 663-6000 George W. Shuster, Jr. WILMER CUTLER PICKERING HALE AND DORR LLP 7 World Trade Center 250 Greenwich Street New York, NY 10007 (212) 230-8800

/s/ Vincent P. Slusher Vincent P. Slusher Andrew Zollinger DLA PIPER 1717 Main Street Suite 4600 Dallas, Texas 75201-4629 (214) 743-4500 Arthur J. Burke Timothy Graulich Dana M. Seshens DAVIS POLK & WARDWELL LLP 450 Lexington Avenue New York, NY 10017 (212) 450-4000

Counsel for the Petitioning Creditors

Dated: September 28, 2013

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Case 13-35998 Document 4 Filed in TXSB on 09/28/13 Page 1 of 5

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : :

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-35998

DECLARATION OF ROBERT S. PICK IN SUPPORT OF PETITIONING CREDITORS MOTION FOR AN ORDER APPOINTING AN INTERIM TRUSTEE 1. My name is Robert S. Pick. I am a Senior Vice President of Houston SportsNet

Finance, LLC (Comcast Lender), a Delaware limited liability company. I make this Declaration in support of the Petitioning Creditors motion for the appointment of an interim trustee in this Chapter 11 case. I make this Declaration solely in my capacity as a Senior Vice President of Comcast Lender. In that capacity, I am familiar with and have personal knowledge of the facts set forth herein. The Network 2. Houston Regional Sports Network, L.P. d/b/a Comcast SportsNet Houston (the

Network) is a Delaware limited partnership. The Network is the owner and operator of a Houston-area regional sports television network that produces and distributes sports programming on a full-time basis. Partners in the Network 3. The Network has three limited partners and one general partner. The limited

partners in the Network are Houston SportsNet Holdings, LLC (Comcast Owner), Rockets Partner, L.P. (Rockets Partner), and Astros HRSN LP Holdings LLC (Astros Partner).

Case 13-35998 Document 4 Filed in TXSB on 09/28/13 Page 2 of 5

4.

Houston Regional Sports Network, LLC (the General Partner), is the general

partner in the Network and, subject to certain limitations, exercises exclusive management, supervision, and control over the Networks properties and business. The General Partners sole purpose is to serve as the Networks general partner; it has no authority or power to act outside of that role. The General Partner has three members: (1) Comcast Owner, (2) JTA Sports, Inc. (Rockets Owner), and (3) Astros HRSN GP Holdings LLC (Astros Owner). 5. Rockets Partner and Rockets Owner are affiliates of Rocket Ball, Ltd. d/b/a the

Houston Rockets (Rockets Team, and together with Rockets Owner and Rockets Partner, the Rockets), a professional basketball franchise in the National Basketball Association. Astros Partner and Astros Owner are affiliates of Houston Astros, LLC (Astros Team, and together with Astros Owner and Astros Partner, the Astros), a professional baseball franchise in Major League Baseball. Comcast Owner and Comcast Lender are both affiliates of Comcast Corporation (together with its affiliates, Comcast). 6. The General Partner is managed by a Board of Directors (the GP Board) that is

comprised of one representative each from the Astros and the Rockets and two representatives from Comcast. Effectively, the GP Board manages the Network, pursuant to the Second Amended and Restated Limited Liability Company Agreement of the General Partner, dated October 29, 2010 and executed by and among the members of the General Partner (the GP Operating Agreement). Comcast Lenders Loan to the Network 7. On October 29, 2010, Comcast Lender entered into an agreement (the Credit

Agreement) with the Network

Case 13-35998 Document 4 Filed in TXSB on 09/28/13 Page 3 of 5

8.

9.

10.

As of May 29, 2013, the Comcast Loan has been fully drawn. Thus, the

aggregate principal balance of the Comcast Loan is currently $100 million.

Case 13-35998 Document 4 Filed in TXSB on 09/28/13 Page 4 of 5

11.

12.

The Networks debt to Comcast Lender under the Credit Agreement and

Promissory Note is not contingent or subject to bona fide dispute, and Comcast Lender does not believe that the Network disputes the liability or amount of Comcast Lenders claim. 13. Comcast Lender understands the Network is currently in financial distress and

may be unable to make its quarterly interest payments under the Credit Agreement in 2014.

14.

Comcast Lender thus believes that the General Partner is unable to operate the

Networks business affairs for the benefit of creditors and other stakeholders, and believes that it would be in the best interest of Comcast Lender and the best interest of the Networks other constituencies for an independent Chapter 11 trustee to conduct a fair and open auction process for the Networks business assets on a going concern basis. 15. In addition, Comcast Lender believes the Networks assets have meaningful

value, and would be prepared to make a bid to acquire either the Network (under a plan of reorganization) or substantially all of its assets. Comcast Lender believes that such a transactionif it were to close by the end of the calendar year, and based on the Networks indebtedness of which it is presently aware and that which it anticipates the Network would incur by year endwould likely lead to prepetition creditors claims and all reasonably foreseeable

Case 13-35998 Document 4 Filed in TXSB on 09/28/13 Page 5 of 5

administrative expenses being paid in full, and a material distribution to equity holders. Comcast Lender of course appreciates that any such transaction would need to be negotiated with and acceptable to the chapter 11 trustee, subject to an open auction process, and ultimately approved by this Court. In addition, Comcast Lender stands prepared, if requested by a Chapter 11 Trustee, to negotiate over the terms of possible debtor-in-possession financing necessary to finance the Networks operations until a sale can be consummated. I declare under penalty of perjury that the foregoing is true and correct.

_/s/ Robert S. Pick__________________ Robert S. Pick

Dated:

Philadelphia, PA September 28, 2013

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 1 of 11

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : :

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-35998

DECLARATION OF JON D. LITNER IN SUPPORT OF PETITIONING CREDITORS MOTION FOR AN ORDER APPOINTING AN INTERIM TRUSTEE 1. My name is Jon D. Litner. I am the President of Comcast Sports Management

Services, LLC (Comcast Services), a Delaware limited liability company. I make this Declaration in support of the Petitioning Creditors motion for the appointment of an interim trustee in this Chapter 11 case. I make this Declaration solely in my capacity as President of Comcast Services. In that capacity, I am familiar with and have personal knowledge of the facts stated herein. The Network 2. Houston Regional Sports Network, L.P. d/b/a Comcast SportsNet Houston (the

Network) is a Delaware limited partnership. The primary purpose of the Network is to create and operate a regional sports programming service (Service) that produces, exhibits, and distributes sports programming on a full-time basis, including live Astros and Rockets games within the league-permitted local territories. Partners in the Network 3. The Network has three limited partners and one general partner. The limited

partners in the Network are Houston SportsNet Holdings, LLC (Comcast Owner), Rockets Partner, L.P. (Rockets Partner), and Astros HRSN LP Holdings LLC (Astros Partner).

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 2 of 11

4.

Houston Regional Sports Network, LLC (the General Partner), is the general

partner in the Network and, subject to certain limitations, exercises exclusive management, supervision, and control over the Networks properties and business. The General Partners sole purpose is to serve as the Networks general partner; it has no authority or power to act outside of that role. The General Partner has three members: (1) Comcast Owner, (2) JTA Sports, Inc. (Rockets Owner), and (3) Astros HRSN GP Holdings LLC (Astros Member). 5. Rockets Partner and Rockets Owner are affiliates of Rocket Ball, Ltd. d/b/a the

Houston Rockets (Rockets Team, and together with Rockets Owner and Rockets Partner, the Rockets), a professional basketball franchise in the National Basketball Association. Astros Partner and Astros Owner are affiliates of Houston Astros, LLC (Astros Team, and together with Astros Owner and Astros Partner, the Astros), a professional baseball franchise in Major League Baseball. Comcast Owner is an affiliate of Comcast Corporation (together with its affiliates, Comcast). 6. The General Partner is managed by a Board of Directors (the GP Board) that is

comprised of one representative each from the Astros and the Rockets and two representatives from Comcast. Effectively, the GP Board manages the Network, pursuant to the Second Amended and Restated Limited Liability Company Agreement of the General Partner, dated October 29, 2010 and executed by and among the members of the General Partner (the GP Operating Agreement).

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 3 of 11

7.

8.

The current formulation of the Network (described above) was created in October

2010, when the Astros and the Rockets reached an agreement with an affiliate of Comcast for the purpose of launching the Service, a new regional sports network that would distribute the teams games and other team-related programming in their respective league-permitted local territories. On October 29, 2010, after lengthy negotiations among Comcast, the Rockets and the Astros, including then-owner of the Astros, Drayton McLane, the parties entered into the Networks and General Partners operating agreements and other integrated transaction documents (the Transaction Documents), pursuant to which Comcast was admitted as a limited partner of the Network and as a member of the General Partner. The Services Agreement and Comcast Services Claim 9. One of the Transaction Documents executed on October 29, 2010, was an

agreement (the Services Agreement) with Comcast Sports Management Services, LLC (Comcast Services). Pursuant to the Services Agreement, Comcast Services agreed to provide the Network with management oversight and various defined Operational Services in exchange for an annual fee (the Service Fee)

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 4 of 11

The pro-rated amount due as of the filing of the involuntary petition is $1,251,573.75. 10. Comcast Services has provided the Network with management oversight and

defined Operational Services in accordance with the terms of the Services Agreement and is otherwise in compliance with the Services Agreement. 11. The Networks debt to Comcast Services pursuant to the Services Agreement is

not contingent or subject to bona fide dispute, and Comcast Services does not believe that the Network disputes the liability or amount of Comcast Services claim. Astros Media Rights Agreement and the Networks Failure To Pay Debt 12. On October 29, 2010, the Network also entered into an amended and restated

media rights license agreement (the Astros Media Rights Agreement) with the Astros.

13.

14.

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 5 of 11

15.

16.

17.

18.

19.

20.

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 6 of 11

21.

Deadlock in the Networks Management and Inability to Improve Cash-Flow 22. Regional sports networks like the Network generate the vast majority of their

revenue by entering into affiliation agreements with MVPDs that agree to carry the networks in exchange for per-subscriber fees. 23.

24.

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 7 of 11

25.

Back in October 2010, in conjunction with the negotiation of the other

Transaction Documents, the Rockets and Astros negotiated directly with Comcast Cable regarding the terms and rates that it would agree to with respect to its carriage of the Networks Service.

26.

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 8 of 11

27.

On November 17, 2011, Jim Crane and a group of investors (the Crane

Ownership Group) purchased the Astros from Drayton McLane, including the Astros interest in the Network and its General Partner. 28.

29.

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 9 of 11

30.

With the GP Board at a complete impasse, the Network is powerless to continue

its affairs and pay its debts. As described in greater detail below, the deadlock among the parties has thwarted all efforts to engage in any constructive exercise to salvage the Network. 31.

32.

33.

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 10 of 11

34.

35.

Comcast Services thus believes that the General Partner is unable to operate the

Networks business affairs for the benefit of creditors and other stakeholders, and believes that it

10

Case 13-35998 Document 5 Filed in TXSB on 09/28/13 Page 11 of 11

would be in the best interest of Comcast Services and the best interest of the Networks other constituencies for an independent Chapter 11 trustee to conduct a fair and open auction process for the Networks business assets on a going concern basis. Comcast Services has substantial concern that if the existing corporate governance structure remains in place, the Network will remain encumbered by management deadlock and paralysis and the Network will be unable to take actions necessary to operate its business affairs for the benefit of creditors and other stakeholders. 36. In short, the Networks past and present behavior and the precarious state of its

finances makes clear that the appointment of an interim trustee is necessary in order to both preserve the property of the estate and to prevent loss to the estate. I declare under penalty of perjury that the foregoing is true and correct.

_/s/ Jon D. Litner_____________________ Jon D. Litner

Dated:

Stamford, CT September 28, 2013

11

Case 13-35998 Document 6 Filed in TXSB on 09/28/13 Page 1 of 2

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : :

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-35998

DECLARATION OF BRUCE A. DAVIS IN SUPPORT OF PETITIONING CREDITORS MOTION FOR AN ORDER APPOINTING AN INTERIM TRUSTEE 1. My name is Bruce A. Davis. I am the Vice President for Financial Operations of

National Digital Television Center, LLC (Comcast Media). I make this Declaration in support of the Petitioning Creditors motion for the appointment of an interim trustee in the Chapter 11 case of the Houston Regional Sports Network, L.P. d/b/a Comcast SportsNet Houston (the Network) . I am familiar with and have personal knowledge of the facts set forth herein. Comcast Medias Claim against the Network 2. Comcast Media is an affiliate of Comcast Corporation. It provides transmission

related services for the Network in the form of satellite and fiber optic reception of various sports programming that is not directly available to the Network at the Networks master control facility located at Altitude Sports in Denver. In addition, the high definition channel for the CSS network, which supplies multiple weekly programs to the Network, is only distributed via the closed loop of the Comcast Cable fiber backbone and therefore cannot be delivered directly to the Network at its technical facility at Altitude. These programs must be recorded at Comcast Media Center and delivered on tape to Altitude for playback. CSN Houston is billed for each instance of program acquisition under this verbal arrangement.

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3.

As of the date of this Declaration, the Network owes Comcast Media $10,517.50

on account of services provided, of the type described above. 4. The Networks debt to Comcast Media is not contingent or subject to bona fide

dispute, and Comcast Media does not believe that the Network disputes the liability or amount of Comcast Medias claim. I declare under penalty of perjury that the foregoing is true and correct. _/s/ Bruce A. Davis____________________ Bruce A. Davis

Dated:

Centennial, Colorado September 28, 2013

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IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS In re: : : : : : : : :

Chapter 11

HOUSTON REGIONAL SPORTS NETWORK, L.P. Alleged Debtor.

Case No.: 13-35998

DECLARATION OF JOHN C. RUTH IN SUPPORT OF PETITIONING CREDITORS MOTION FOR AN ORDER APPOINTING AN INTERIM TRUSTEE 1. My name is John C. Ruth. I am the Executive Vice President of Finance,

Planning and Business Operations of Comcast SportsNet California, LLC (CSN CA). I make this Declaration in support of the Petitioning Creditors motion for the appointment of an interim trustee in the Chapter 11 case of the Houston Regional Sports Network, L.P. d/b/a Comcast SportsNet Houston (the Network). I am familiar with and have personal knowledge of the facts set forth herein. CSN CAs Claim against the Network 2. CSN CA is an affiliate of Comcast Corporation and is a regional sports network

that primarily distributes programming in the northern California region, including the games of the Oakland As and the Sacramento Kings. CSN CA facilitates the provision of production services to the Network. Specifically, a verbal arrangement between the Network and CSN CA allows the Network to produce an extremely economical telecast due to the sharing of major technical infrastructure, cameras, replay devices and personnel with other networks producing the same gamesin this case CSN CA. In order to do this, CSN CA deploys a smaller, separate unit to accommodate the Networks production, and elements of the CSN CA broadcast are blended with the reduced Network equipment complement and customized with graphics,

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announcers, etc., for the Networks distribution of the game in its market. The Network is billed by CSN CA for each instance of this type of production under this verbal arrangement. 3. As of the date of this Declaration, the Network owes CSN CA $43,129.02 on

account of services provided, of the type described above. 4. The Networks debt to CSN CA is not contingent or subject to bona fide dispute,

and CSN CA does not believe that the Network disputes the liability or amount of Comcast CSN CAs claim. I declare under penalty of perjury that the foregoing is true and correct. _/s/ John C. Ruth ____________________ John C. Ruth

Dated:

Stamford, CT September 28, 2013