By Stephen Young
By Stephen Young
By Stephen Young
By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
"At this point, the Tour came to us and said 'We want to do this differently. We want to be a partner,'" Mitchell says. In the ensuing litigation, the Tour would vigorously contest the claim that it had entered into a "partnership" with Sportsband.
Letters and internal tour documents show Sportsband and the Tour did agree that the broadcasts needed what is called a title sponsor--a big company that would pay to underwrite the broadcasts in exchange for having its name slapped all over the production. Mitchell says the Tour promised to find such a sponsor.
One of the most likely places to find advertisers was among the very valuable bank of corporations that were already paying to sponsor other aspects of professional golf. That list--and those relationships--are dearly coveted by the Tour, and Tour officials did not want Sportsband approaching its prized clients. Instead, the Tour decided it would assume the job of pitching Sportsband to the existing PGA corporate partners.
Tour documents, and testimony in depositions during the later litigation, indicate that the Tour didn't want anyone else cozying up to its sponsors. "We took the responsibility to bring the product to the attention of [Tour] sponsors," Finchem later testified in deposition. "We like to control the manner in which our product is sold to our own clients."
Sportsband was left mainly with responsibility for the technical end, the production of the broadcasts, Mitchell says. The Tour was handling the marketing and passing some of the advertising revenue on to Sportsband.
"I was being sold a line on a lot of stuff," Mitchell says now. "My God, it was the PGA Tour. I believed everything they told me."
Still, Sportsband's future looked bright in the summer of 1988. Mitchell and Rice raised more money by allowing a limited partnership to buy part of the company. "I thought the idea of a radio with an earpiece was a good idea for a number of sports venues," recalls Rebel Blackwell, a Dallas hunting and fishing guide who invested in the company. "I feel the same way today."
The company began hiring well-known former golfers and golf pros to serve as announcers for its broadcasts. Sportsband broadcasts were going to be first-class from the outset. "I wanted something that had some pizzazz, some show-biz to it," Mitchell says.
In 1989, Sportsband was to begin its first season of full-blown broadcasts. After investing at least $4 million to start the company, obtain permits, perfect the technology, and prove themselves to the Tour, Mitchell and Rice thought they were finally going to start making some money.
But that didn't happen, Mitchell says, because the Tour never held up its end of the deal. Despite repeated promises, Mitchell says, the Tour never came up with a title sponsor, which was crucial to Sportsband's viability. And sales to other potential advertisers were slow getting started. The Tour didn't sell enough sponsorships to cover the costs of producing the planned 1989 broadcasts.
Concerned about the Tour's lack of progress in finding a title sponsor, Mitchell himself began discussions with one of the kingpins of sports promotion--Anheuser-Busch--hoping to convince the beer giant to underwrite the broadcasts.
After broadcasting several tournaments at a loss in 1989, Mitchell decided it was time to re-trench. He recommended that Sportsband halt broadcasting for the rest of 1989 and give the Tour's marketing arm a chance to fully sell the Sportsband concept. The broadcasts would resume in 1990, he said, with stronger financial underpinnings. The Tour needed to catch up with Sportsband.
"It was like we were opening a movie without any advance promotion," Mitchell says. "What I said was that I wanted to spend the balance of 1989 perfecting the marketing programs."
The Tour didn't cotton to Mitchell's proposal. In fact, it responded by terminating Sportsband's contract. Suddenly left without any rights to PGA tournaments, Sportsband had nothing to sell. For all intents and purposes, the company was dead.
"I didn't have any warning at all," Mitchell says. "Overnight, the bottom falls out."
The contract cancellation became the basis of Mitchell's first lawsuit against the Tour, filed in 1992.
But even after the cancellation, Mitchell did not give up. He tried to salvage his idea by forming a new company, the Spectator Communications Network. Mitchell tried to get around the Tour's monopoly by cutting deals with the sponsors of individual tournaments. Even if he had to get in through the back door, Mitchell was determined to make his company work.
Mitchell kept talking with Anheuser-Busch, and the company agreed to sponsor several SCN broadcasts at tournaments. Some of the tournaments were receptive to allowing the broadcasts. It looked like Mitchell might snatch victory from the jaws of defeat.
But in 1993, Busch jilted Mitchell, and instead entered directly into promotional agreements with the Tour. Mitchell claims the Tour courted Busch as a way of sabotaging Mitchell's bid to save his business. That claim is largely the basis of a second lawsuit Mitchell filed against the Tour in 1995.
To the bitter end, Mitchell says, he loathed the idea of taking the disagreements to court. He was a longtime adherent to the belief that principled businessmen could work out their problems among themselves. "I'd never been in a lawsuit in my life," Mitchell says.