LOS ANGELES – The NFL was found guilty of violating antitrust laws by distributing out-of-market games on Sunday afternoons on the premium subscription service “Sunday Ticket.”
Although a jury of five men and three women in U.S. District Court awarded nearly $4.8 billion in damages Thursday to residential and commercial “Sunday Ticket” subscribers, don’t expect any settlement checks or the ending the service so soon.
The league violated antitrust laws by selling “Sunday Ticket” only on DirecTV and at an inflated price. By offering the service through only one distributor and at a high price, it limited the subscriber base and satisfied CBS and Fox’s concerns about preserving local ratings, while the NFL received a lot of money for its broadcast rights.
Three weeks. It began with opening statements on June 6 and featured 10 days of testimony before closing arguments on Wednesday. The jury deliberated for nearly five hours on Wednesday and Thursday before reaching a decision.
The NFL brought commissioner Roger Goodell and Dallas Cowboys owner Jerry Jones to testify, but they were unhelpful. The plaintiffs primarily used economists and videos of pretrial depositions.
The class action applies to more than 2.4 million residential subscribers and 48,000 businesses, primarily bars and restaurants, who purchased the “NFL Sunday Ticket” from June 17, 2011 to February 7, 2023.
The jury awarded $4.7 billion to residential subscribers and $96 million to businesses. Because damages are tripled under federal antitrust laws, the NFL could end up being responsible for $14.39 billion unless it reaches a settlement or is reduced
The residential damages were slightly less than the $5.6 billion offered in the plaintiffs’ college football model, but more than a model in which the “Sunday Ticket” would have multiple operators and a 49.7% reduction in subscription cost ($2.81 billion).
The commercial damages were much lower than those presented by the plaintiffs in any of the three models. The lowest value was $332 million in what was called the “NFL Tax” model.
It would be distributed equally among the 32 teams. That means each could pay up to $449.6 million.
Changes to the “Sunday Ticket” package and/or the way the NFL conducts its Sunday afternoon games would be suspended until all appeals are completed. However, if the league was smart, it would start offering team-by-team or week-by-week packages, in addition to reducing the price.
ESPN proposed offering “Sunday Ticket” for $70 per season with team-by-team packages in 2022, but was rejected by the NFL before it was launched on YouTube TV.
If the NFL offered team-by-team packages all the time, one of the key members of the class probably wouldn’t have been part of the process.
Rob Lippincott – a New Orleans native who moved to California – bought the “Sunday Ticket” just for Saints games.
“He just wanted the Saints. If he had the option to purchase a single-team package and watch Saints games, he absolutely would have done so,” said plaintiffs’ attorney Amanda Bonn during her opening statement on June 6.
The landmark 1984 college football TV case was ruled by the U.S. Supreme Court. This occurred at the US District Court level.
The NFL said it would appeal the verdict. That appeal would go to the 9th Circuit Court of Appeals and possibly the Supreme Court.
It wouldn’t be the first time the 9th Circuit has seen this case.
The lawsuit was originally filed in 2015 by the Mucky Duck sports bar in San Francisco. On June 30, 2017, U.S. District Judge Beverly Reid O’Connell dismissed the lawsuit and ruled for the NFL. Two years later, the 9th Circuit Court of Appeals reinstated the case.
During his closing remarks, lead attorney Bill Carmody showed an NFL memo from April 2017 that showed the league was exploring a world without “Sunday Ticket” in 2017, where cable channels aired out-of-market games on Sunday afternoons not shown on Fox or CBS.
Judge Philip S. Gutierrez expressed his frustration with the plaintiffs’ lawyers midway through the trial, but Carmody’s closing argument was clear and easy to understand.
The NFL may be the king of American sports and one of the most powerful leagues in the world, but it often loses in court, especially in Los Angeles. It was in a Los Angeles federal court in 1982 that a jury ruled that the league violated antitrust rules by not allowing Al Davis to move the Raiders from Oakland to Los Angeles.
All eyes turn to July 31, when Gutierrez is scheduled to hear post-trial motions. This will include the NFL’s request that he rule in the league’s favor because the judge ruled that the plaintiffs did not prove their case.
All major leagues offer out-of-market packages and are watching this case because individual teams selling their broadcast rights out-of-market, especially in baseball, would further separate the haves from the have-nots.
One big difference, though, is that MLB, NBA and NHL sell their packages off-market at multiple distributors and share revenue per subscriber rather than receiving a direct fee for the rights.
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This story originally appeared on ABCNews.go.com read the full story
