Class-Action Lawsuit Against NFL's 'Sunday Ticket': A Battle Over Antitrust Laws
LOS ANGELES -- The federal judge presiding over the class-action lawsuit filed by "Sunday Ticket" subscribers against the NFL voiced his frustrations Tuesday with how the plaintiffs' attorneys are handling their side of the case. Before Dallas Cowboys owner Jerry Jones took the stand for a second day of testimony, U.S. District Judge Philip Gutierrez made it clear that the case's premise was straightforward.
Subscriber Frustrations and Legal Claims
Judge Gutierrez emphasized the common frustration faced by fans, such as a Seattle Seahawks supporter living in Los Angeles, who cannot watch their favorite team without purchasing a subscription for all the Sunday afternoon out-of-market games. The class-action lawsuit affects 2.4 million residential subscribers and 48,000 businesses that paid for the package of out-of-market games from the 2011 through 2022 seasons.
The lawsuit alleges that the NFL violated antitrust laws by selling its package of Sunday games aired on CBS and Fox at an inflated price. Furthermore, subscribers argue that the league restricted competition by offering "Sunday Ticket" exclusively through a satellite provider. The NFL, however, firmly maintains that it has the right to sell "Sunday Ticket" under its antitrust exemption for broadcasting. Plaintiffs contend that this exemption only applies to over-the-air broadcasts and not pay TV.
Potential Billions in Damages
If the NFL is found liable, a jury could award up to $7 billion in damages. This figure could escalate to $21 billion because antitrust cases can result in triple damages. Judge Gutierrez's frustrations with the plaintiffs' side are not new; on Monday, he admonished their attorneys for repeatedly describing past testimony, which he deemed a waste of time.
Jerry Jones' Past Legal Battles
Before Jerry Jones resumed his testimony, Judge Gutierrez expressed doubts about the plaintiffs' attorneys citing Jones' lawsuit against the NFL in 1995. The lawsuit challenged the league's licensing and sponsorship procedures and was eventually settled out of court.
In his 1994 lawsuit against the NFL, Jones asserted that while he supported the league's model for negotiating television contracts and the revenue-sharing agreements in place, he opposed its licensing and sponsorship procedures. When asked Tuesday if teams should be able to sell their out-of-market television rights, Jones replied that they should not, as it "would undermine the free TV model we have now."
Network Opposition and DirecTV Pricing
Retired CBS Sports chairman Sean McManus also took the stand, reiterating his longstanding opposition to "Sunday Ticket" and the NFL's Red Zone channel. McManus believes that "Sunday Ticket" infringes on the exclusivity CBS has in local markets. During negotiations, both CBS and Fox requested that "Sunday Ticket" be sold as a premium package. DirecTV, not the NFL, set the prices during the class-action period.
The league has language in its television contracts with CBS and Fox that stipulates the resale packages ("Sunday Ticket") are to be marketed as premium products for avid league fans that satisfy complementary demand to the offering of in-market games. Additional language prohibits selling individual games on a pay-per-view basis. From 1994 through 2022, the NFL received a rights fee from DirecTV for the package. Starting last year, Google's YouTube TV acquired "Sunday Ticket" rights for seven seasons.
Industry Comparisons and Continuing Testimonies
During a deposition, DirecTV marketing official Jamie Dyckes stated that MLB, the NBA, and the NHL had a suggested retail price for their out-of-market packages. Dyckes added that there was revenue sharing between the leagues and the carriers, as their packages were distributed across multiple platforms. Testimony will continue Thursday, with closing statements scheduled for early next week.
Judge's Consideration of Case Complexity
Judge Gutierrez mentioned he would consider invoking a rule allowing the court to find that a jury lacks sufficient evidence to rule for a party in a case. Summarizing his frustrations, Gutierrez candidly admitted, "I'm struggling with the plaintiffs' case." Throughout the proceedings, his comments have reflected his mounting frustrations, stating, "The way you have tried this case is far from simple." He also remarked, "This case has turned into 25 hours of depositions and gobbledygook," adding, "This case has gone in a direction it shouldn't have gone."
As the case progresses, all eyes will remain on the courtroom, anticipating whether the plaintiffs' attorneys can present a compelling argument that aligns with the straightforward premise Judge Gutierrez initially outlined.