NFL ordered to pay billions in Sunday ticket lawsuit
The NFL must pay nearly $5 billion in damages for artificially inflating the price of Sunday Ticket, a subscription service offered by DirecTV that shows out-of-market games, a federal jury in Los Angeles decided Thursday.
The verdict, which ended a month-long class action lawsuit and nearly a decade of legal wrangling, includes about $96 million in damages for the bars and restaurants that subscribed to the service, and more than $4.6 billion for approximately 2.4 million private subscribers. Damages in antitrust cases like this are tripled by law, meaning the league could have to pay more than $14 billion.
The jury’s damages amounted to most of what the plaintiff’s attorneys had sought. “It’s a great day for consumers everywhere,” said Bill Carmody, one of the plaintiffs’ attorneys.
The NFL is expected to appeal the ruling.
“We are disappointed with the jury’s verdict today in the NFL Sunday Ticket class action lawsuit,” league spokesman Brian McCarthy said in a statement. “We will certainly appeal this decision, as we believe the class action claims in this case are without merit and without merit.”
Judge Philip Gutierrez, who publicly admonished plaintiffs’ lawyers during the trial in U.S. District Court, will hear post-trial motions next month. He could theoretically conclude that the jury reached an improper verdict. An appeals court could also change the amount of damages.
Still, the ruling poses a major risk for the league, which generates a turnover of $20 billion through its media deals.
“Juries are inherently unpredictable, but any time a ruling is made against a sports organization it matters because leagues rarely take these types of cases to trial,” said Gabriel Feldman, director of the sports law program at Tulane University .
The civil case struck at the heart of the league’s media distribution strategy, which for more than half a century has been based on negotiating contracts with networks on behalf of all teams. More than 90 percent of NFL games are shown on free over-the-air television in the teams’ markets in the games, and many other games are shown in prime time on national networks. The league’s contracts with CBS, Fox, NBC and other broadcasters generate more than $10 billion a year.
Sunday Ticket was a unique product in that it packaged out-of-market games already shown by CBS and Fox and resold them to fans for about $300 per season. The plaintiffs alleged that the price was intentionally raised to limit the number of subscribers. The plaintiffs’ attorneys pointed to an email to NFL executives from ESPN that said the cable sports network was willing to offer Sunday Ticket for as little as $70 and sell single-team packages.
The league rejected the offer and stayed with DirecTV until 2022, when a new deal was struck with YouTube TV.
During the trial, the league acknowledged that CBS and Fox would be hurt if Sunday Ticket attracted too many subscribers. Commissioner Roger Goodell, testifying last week, said the service was priced as a premium product.
The jury — and many fans — argued that the league could and should offer its games at a lower price and with more flexible options, such as team-only packages. Feldman, the Tulane professor, said the NFL would likely repeat its position on appeal that while it negotiated contracts collectively, it was pro-consumer because it offered so many games for free over the air.
The NFL will argue that “we’re not like Coke and Pepsi — we’re more like Coke and Coke Zero,” Feldman said. “We’re part of the same company and share the same goals.”
