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Commitments and Contingencies | 9 Months Ended
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Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract] |
Commitments and Contingencies | Commitments and Contingencies Leases The components of lease expense were as follows:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2022 |  | 2021 |  | 2022 |  | 2021
Operating leases |  |  |  |  |  |  |
Operating lease cost | $ | 1,648 |  |  | $ | 469 |  |  | $ | 4,946 |  |  | $ | 1,248 |
Other lease cost | 85 |  |  | 178 |  |  | 230 |  |  | 178 |
Operating lease expense | 1,733 |  |  | 647 |  |  | 5,176 |  |  | 1,426 |
Short-term lease rent expense | 38 |  |  | 41 |  |  | 141 |  |  | 41 |
Total rent expense | $ | 1,771 |  |  | $ | 688 |  |  | $ | 5,317 |  |  | $ | 1,467 |
Supplemental cash flow information related to leases were as follows (in thousands, except term and discount rate):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2022 |  | 2021 |  | 2022 |  | 2021
Operating cash flows from operating leases | $ | 667 |  |  | $ | 462 |  |  | $ | 1,644 |  |  | $ | 1,136 |
Right of use assets exchanged for operating lease liabilities | $ | — |  |  | $ | — |  |  | $ | 3,931 |  |  | $ | 3,522 |
Weighted average remaining lease term - operating leases | 11.2 |  | 5.0 |  | 11.2 |  | 5.0
Weighted average remaining discount rate - operating leases | 7.3 | % |  | 5.7 | % |  | 7.3 | % |  | 5.7 | %
As of September 30, 2022, future minimum payments for the operating leases are as follows (in thousands):
Year Ended December 31, 2022 | $ | 660 |
Year Ended December 31, 2023 | 5,692 |
Year Ended December 31, 2024 | 6,822 |
Year Ended December 31, 2025 | 6,504 |
Year Ended December 31, 2026 | 5,833 |
Thereafter | 40,980 |
Total | 66,491 |
Less present value discount | (23,444) |
Operating lease liabilities | $ | 43,047 |
Other Contractual Obligations The Company is a party to several non-cancelable contracts with vendors and licensors for marketing and other strategic partnership related agreements where the Company is obligated to make future minimum payments under the non-cancelable terms of these contracts as follows (in thousands): Market Access Agreements
Year Ended December 31, 2022 | $ | 2,853 |
Year Ended December 31, 2023 | 4,000 |
Year Ended December 31, 2024 | 4,000 |
Year Ended December 31, 2025 | 4,000 |
Year Ended December 31, 2026 | 3,875 |
Thereafter | 8,500 |
Subtotal | 27,228 |
Less present value discount | (5,326) |
Total | $ | 21,902 |
Annual Sponsorship Agreements
Year Ended December 31, 2022 | $ | 2,405 |
Year Ended December 31, 2023 | 6,581 |
Year Ended December 31, 2024 | 6,830 |
Year Ended December 31, 2025 | 7,010 |
Year Ended December 31, 2026 | 3,325 |
Thereafter | 19,675 |
Total | $ | 45,826 |
Sports Rights Agreements The Company entered into various sports right agreements to obtain programming rights to certain live sporting events. Future payments under these agreements are as follows:
Year Ended December 31, 2022 | $ | 10,622 |
Year Ended December 31, 2023 | 41,687 |
Year Ended December 31, 2024 | 26,065 |
Year Ended December 31, 2025 | 13,748 |
Year Ended December 31, 2026 | 13,748 |
Thereafter | 18,330 |
Total | $ | 124,200 |
During the nine months ended September 30, 2022, the Company made upfront payments totaling approximately $42.9 million, which are recorded in prepaid and other current assets on the condensed consolidated balance sheet. Contingencies The Company is subject to certain legal proceedings and claims that arise from time to time in the ordinary course of its business, including relating to business practices and patent infringement. Litigation can be expensive and disruptive to normal business operations. Moreover, the results of complex legal proceedings are difficult to predict and the Company’s view of these matters may change in the future as the litigation and events related thereto unfold. When the Company determines that a loss is both probable and reasonably estimable, a liability is recorded and disclosed if the amount is material to the financial statements taken as a whole. When a material loss contingency is only reasonably possible, the Company does not record a liability, but instead discloses the nature and the amount of the claim, and an estimate of the loss or range of loss, if such an estimate can reasonably be made. Legal expenses associated with any contingency are expensed as incurred. The Company is engaged in discussions with certain third parties regarding patent licensing matters. The Company is not able to reasonably estimate whether it will be able to reach an agreement with these parties or the amount of potential licensing fees, if any, it may agree to pay in connection with these discussions, but it is possible that any such amount could be material. Following the dissolution of Fubo Gaming in October 2022, the Company has received communications from several commercial partners of Fubo Gaming, alleging breach by Fubo Gaming of applicable agreements. Additional allegations, or litigation, may arise against Fubo Gaming or the Company in the future related to the dissolution of Fubo Gaming, including potential breach of contract claims by other commercial partners of Fubo Gaming or claims related to guarantees by the Company of Fubo Gaming’s contractual obligations. From time to time, we enter into business arrangements with vendors for technology services in the ordinary course of business. We are currently engaged in discussions with a vendor surrounding the scope of the parties’ relationship and underlying obligations under the terms of their contract. This includes, among other things, the type and range of services to be provided by this vendor to the Company, the corresponding expenditures by the Company payable under the agreement, and the vendor’s compliance with its good faith express and implied obligations under the contract. Accordingly, we are not able to reasonably estimate the amount of the Company’s potential expenditures, if any, under our arrangement with this vendor, but it is possible that the amounts that the Company may pay for services under the contract could be material. Legal Proceedings The Company is and may in the future be involved in various legal proceedings arising from the normal course of business activities. Although the results of litigation and claims cannot be predicted with certainty, currently, the Company believes that the likelihood of any material adverse impact on the Company’s consolidated results of operations, cash flows or our financial position for any such litigation or claims is remote. Regardless of the outcome, litigation can have an adverse impact on the Company because of the costs to defend lawsuits, diversion of management resources and other factors. Said-Ibrahim v. fuboTV Inc., David Gandler , Edgar M. Bronfman Jr., & Simone Nardi , Case No. 21-cv-01412 (S.D.N.Y) & Lee v. fuboTV, Inc., David Gandler, Edgar M. Bronfman Jr., & Simone Nardi, Case No. 21-cv-01641 (S.D.N.Y.) (consolidated as In re fuboTV Inc. Securities Litigation, No. 21-cv-01412 (S.D.N.Y.)) On February 17, 2021, putative shareholders Wafa Said-Ibrahim and Adhid Ibrahim filed a class action lawsuit against the Company, co-founder and CEO David Gandler, Executive Chairman Edgar M. Bronfman Jr., and CFO Simone Nardi (collectively, the “Class Action Defendants”). Plaintiffs allege that Class Action Defendants violated federal securities laws by disseminating false and misleading statements regarding the Company’s financial health and operating condition, including the Company’s ability to grow subscription levels, prospects, future profitability, seasonality factors, cost escalations, ability to generate advertising revenue, valuation, and entering the online sports wagering market. The Plaintiffs allege that Class Action Defendants violated Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 thereunder, as well as Section 20(a) of the Exchange Act, and seek damages and other relief. On February 24, 2021, putative shareholder Steven Lee filed a nearly identical class action lawsuit against the same Defendants. On April 29, 2021, the court consolidated Said-Ibrahim v. fuboTV Inc., David Gandler, Edgar M. Bronfman Jr., & Simone Nardi, Case No. 21-cv-01412 (S.D.N.Y) and Lee v. fuboTV, Inc., David Gandler, Edgar M. Bronfman Jr., & Simone Nardi, Case No. 21-cv-01641 (S.D.N.Y.) under In re FuboTV Inc. Securities Litigation, No. 1:21-cv-01412 (S.D.N.Y.). The court also appointed putative shareholder Nordine Aamchoune as lead plaintiff. On July 12, 2021, Lead Plaintiff filed an Amended Class Action Complaint. Lead Plaintiff seeks to pursue this claim on behalf of himself as well as all other persons who purchased or otherwise acquired Company securities publicly traded on the New York Stock Exchange (“NYSE”) between March 23, 2020 and January 4, 2021, inclusive, and who were allegedly damaged thereby. The Class Action Defendants filed a motion to dismiss the Amended Class Action Complaint on September 10, 2021. Lead Plaintiff filed an opposition on November 9, 2021. Class Action Defendants’ filed their reply in support of the motion to dismiss on December 9, 2021. The Company believes the claims alleged in both lawsuits are without merit and intends to vigorously defend these litigations. Andrew Kriss and Eric Lerner vs. FaceBank Group, Inc. et. al. (Index No. 605474/20 Supreme Court of the State of New York. On June 8, 2020, Andrew Kriss and Eric Lerner filed a Summons with Notice in the Supreme Court of the State of New York, Nassau County naming as defendants the Company, PEC, John Textor and Frank Patterson, among others. On November 12, 2020, plaintiffs filed a Complaint, which asserts claims for breach of express contract and implied duties, fraud in the inducement, unjust enrichment, conversion, declaratory relief, fraud, and fraudulent conveyance. The claims arise from an alleged relationship between Plaintiffs and defendant PEC. Plaintiffs seek monetary damages in an amount to be proven at trial, but not less than six million dollars ($6,000,000). The Company believes the claims are without merit and intends to vigorously defend this litigation and on January 19, 2021, the Company filed a motion to dismiss all claims asserted against it. A court conference was held on November 15, 2021, and the court confirmed that the motion to dismiss was fully submitted. On August 18, 2022, the Court issued an order dismissing all claims against the Company.

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