Sunday Ticket trial revolves around battle of economic pundits

Criminal trials come down to one question: Did the defendant do it? Civil trials have two big issues. Did the defendant do this, and if so, what was the financial loss?

The NFL’s last major antitrust trial, which took place 38 years ago, resulted in the conclusion that the NFL violated the law regarding the USFL, but that the USFL was unable to prove any financial harm. In the ongoing Sunday Ticket trial, testimony focused on testimony from competing economic experts regarding losses to consumers resulting from the NFL’s alleged antitrust violations.

Financial damages assume even greater importance in antitrust cases, as by law the amount triples after the verdict is handed down.

This is where we press pause to make an overall assessment. This is a major trial that could result in a billion-dollar verdict against the NFL and that could force the league to revolutionize the way games are distributed to consumers. And almost no one is covering it. We had to constantly search for any snippets we could find, and we often found them on unconventional news sites.

Via Craig Clough of Law360.com, Thursday’s Testimony it featured the last witness in the plaintiff’s case in chief and the first witness in the defendant’s case in chief. Both are economic experts who have wrestled over the impact of the alleged effort to keep the price of the Sunday Ticket high — and to keep subscriber numbers low.

This is almost always the case in cases where losses require careful analysis and calculation. The plaintiff has high numbers and the defendant fails the calculation and/or presents lower numbers.

Earlier this week, Daniel A. Rascher (director of academic programs and professor in the sports management master’s program at the University of San Francisco) testified that the damage exceeds $7 billion. On Thursday, John Douglas Zona, who has a Ph.D. in economics from the State University of New York at Stony Brook, testified that the Sunday Ticket price was 24.6% higher than the “sweet spot” where profits would have been maximized.

He described the difference as an “NFL tax” since the league allegedly required DirecTV to use a higher price than DirecTV wanted to charge.

In cross-examination, Zona acknowledged that his calculations showed that the average price actually paid by consumers for the Sunday Ticket was US$102.74. (As someone who paid WAY more than that for 27 years, it would have been nice to know there was a much cheaper way to do this other than piracy.)

The story continues

The plaintiffs apparently rested after Zona’s testimony, because on Thursday afternoon the NFL called Ali Yurukoglu, an economist at Stanford University. His testimony focused exclusively on attacking Zona’s work. He will testify again when the trial resumes on Monday.

Typically, the jury is surprised during this type of testimony. The challenge for lawyers representing plaintiffs will be to provide the jury with the right numbers (as supported by trial evidence) during closing arguments. If the jury believes the NFL violated the law, the jury will need to attach a number to it. This number needs to be supported by evidence.

The NFL, in addition to arguing that it did nothing wrong, will try to show that the plaintiffs’ numbers are unreliable. This way, the NFL has a chance to do what it did in 1986.

Lose the battle of liability, but win the war of damages.