The New York Jets are suing Fubo Gaming Inc. in Delaware’s Court of Chancery amid a feud over payments of a sponsorship agreement.
“We believe this petition is without merit and intend to vigorously defend our position,” said a spokesperson for fuboTV.
short-lived attempt to break into the gambling world
The Jets, as stated in a suit filed on November 4, are seeking the appointment of a third party to retrieve the money they are owed from Fubo. Fubo Gaming is a branch of fuboTV that enjoyed a short-lived attempt to break into the gambling world. The company recently filed for dissolution in Delaware and is no longer pursuing its gaming plans.
Jets say Fubo needs to pay
Andrew Lee, an attorney from Foley & Lardner representing the Jets, said the team was “shocked to learn” of the move.
the team maintains that it has performed all of its contractual obligations
The Jets also believe that fuboTV is responsible for paying off Fubo Gaming’s debt incurred through the sponsorship agreement as the parent company of the shuttered subsidiary. In a letter sent to Fubo late last month, Lee noted that Fubo Gaming was dissolved at the command of fuboTV’s directors, which he claims proves they are responsible for paying the rest of the debt.
According to the Jets, Fubo agreed to pay $12.4m over five years but already missed a $1.2m payment due October 1. The team maintains that it has performed all of its contractual obligations, including advertising Fubo Gaming, providing tickets and a suite for games, and providing marketing resources, and that Fubo is operating “in bad faith.”
The legal system is responsible for deciding on a remedy for the situation. Its first task will be deciding if fuboTV is responsible for paying off the debts of a subsidiary, and if so, deciding on the amount and time period during which they have to pay the Jets.
Fubo announced that it was closing down its young gaming arm in October. The move was not unforeseen, as the company had already backed out of its initial acquisition phase and was mulling ways to reenter the gaming scene.
However, economic problems rendered the company unable to return to the market without significant, potentially devastating losses. The company’s goal is to be profitable by 2025 and it feels that continuing to operate Fubo Gaming would greatly jeopardize that timeline.
There was hope that the Fubo sportsbook would be able to turn enough profits to change the course of the company’s bottom line. Unfortunately, the operations in Arizona, Iowa, and New Jersey were not enough to help the company avoid the red.
Fubo and the Jets could rework their contractual agreement to present fuboTV
While Fubo Gaming is no longer in service, fuboTV still is. It is possible that Fubo and the Jets could rework their contractual agreement to present fuboTV, not Fubo Gaming, as the entity in the sponsorship deal. Fubo would still have to pay the costs, but it would receive significant exposure.