Yahoo Finance NFL ordered to pay billions in damages for 'overcharged' Sunday Ticket
The NFL suffered a huge setback Thursday and was ordered to pay nearly $4.8 billion in damages for violating antitrust law in a class-action suit over pricing of DirecTV’s “Sunday Ticket” packages.
A Los Angeles jury voted unanimously that the league colluded with DirecTV, along with CBS and Fox, to drive up pricing of the premium product.
The jury deliberated for roughly five hours over two days. If the verdict stands, the jury said the league owes $4.7 billion in damages to the residential class and $96 million in damages to the commercial class.
The NFL could be liable up to $14.1 billion under federal laws that triple the amount won in antitrust cases.
Said a spokesman for the NFL: “We are disappointed with the jury’s verdict today in the NFL Sunday Ticket class action lawsuit. We continue to believe that our media distribution strategy, which features all NFL games broadcast on free over-the-air television in the markets of the participating teams and national distribution of our most popular games, supplemented by many additional choices including RedZone, Sunday Ticket and NFL+, is by far the most fan friendly distribution model in all of sports and entertainment. We will certainly contest this decision as we believe that the class action claims in this case are baseless and without merit. We thank the jury for their time and service and for the guidance and oversight from Judge Gutierrez throughout the trial.”
The lawsuit covered 2.4 million residential subscribers and 48,000 businesses who paid for the package of out-of-market games from the 2011 through 2022 seasons on DirecTV.
The trial lasted three weeks and included testimony from NFL commissioner Roger Goodell and Dallas Cowboys owner Jerry Jones, among others.
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Said Bill Carmody, lead attorney for the plaintiff: “It’s a great verdict for consumers around America that this jury, despite the star power of the defendants, upheld the antitrust laws which are geared to protect consumers from overcharges.
“Justice was served.”
The next likely steps for the dispute will be the filing of post-trial motions, which will be heard by the trial judge on July 31.
If the verdict is not set aside, the judge is likely to be asked to consider possible structural changes in the Sunday Ticket package, as well as plaintiff's lawyers request for an award of legal fees.
Once those issues are resolved, the league will appeal any adverse rulings to the Ninth Circuit. The NFL expects the payment of any damages and imposition of any structural changes to the Sunday Ticket package would be stayed until all appeals have been concluded.
The jury began deliberations Wednesday afternoon in the wake of closing arguments from the sides and jury instructions from U.S. District Judge Philip Gutierrez. Jury deliberations continued Thursday.
It took nearly a decade for the case to wind its way through the legal ecosystem, beginning in 2015 when a San Francisco pub called the Mucky Duck filed a complaint about how the NFL handles its out-of-market broadcasts.
The class action was filed on behalf of more than 2.4 million residential subscribers and more than 48,000 restaurants, bars and other commercial establishments that show the games. It centered on the “Sunday Ticket” package — now sold through YouTube TV — which allows subscribers access to the broadcasts of all out-of-market Sunday games that air on CBS and Fox.
They are not special broadcasts but identical to what people are seeing in those various home markets. By the league’s estimate, a mere 3% of fans subscribe to “Sunday Ticket,” which this season costs $449 absent any discounts or promotions.
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The plaintiffs alleged the NFL colluded with network partners CBS and Fox, along with DirecTV, to ensure the pricing of “Sunday Ticket” remained high, thereby violating antitrust law.
The plaintiffs were seeking $7 billion in damages for the period between 2011 and 2022, and those are tripled in antitrust cases. That $21 billion is enough to buy an entire four-team division.
The NFL argued that it was not in control of “Sunday Ticket” pricing but DirecTV was, and often gave away the premium product for free to attract subscribers. Attorneys representing the league frequently pointed out the NFL is the only major sports league that provides fans 100% of local games on free, over-the-air TV.
“It’s a valuable, premium product, and the prices were reasonable,” Beth Wilkinson, representing the NFL, said in her opening statement. “Fans don’t have to buy Sunday Ticket… The league wants as many people as possible to watch the free broadcasts.”
Wilkinson said that after promotions and giveaways, the average price of Sunday Ticket during the period in question was $102.70 per season.
This story originally appeared in Los Angeles Times.
