The kickoff for the NFL’s Super Bowl in 2024.
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The National Football League has been hit with a roughly $4.7 billion verdict after a jury found that its broadcast model violates antitrust laws.
A Los Angeles jury on Thursday agreed with fans who claimed they overpaid for NFL Sunday Ticket. The decision, which was reached after less than a full day of deliberations, could force the league to change its broadcast model that’s made it the most popular sports league in the country.
The eight-year-old legal battle centered on allegations that the league and its 32 teams conspired in violation of antitrust laws to allow the NFL to reach exclusive deals with broadcast partners for the right to air out-of-market games.
In a statement, an NFL spokesperson said the verdict will be appealed. “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,” the statement continued.
Damages can be tripled following a judgment over violations of antitrust law, meaning the NFL could be on the hook for nearly $15 billion. The league is expected to move to set aside the verdict. It the judge upholds the decision, the court will consider structural changes to Sunday Ticket. Appeals to the U.S. 9th Circuit Court of Appeals will follow.
NFL fans in 2015 brought the class action. They highlighted a major difference in how the NFL approaches broadcasts compared to the other four professional sports leagues: Viewers who want to watch games that aren’t broadcast locally must purchase the Sunday Ticket premium offering. This means that Kansas City Chiefs fans living in Los Angeles must pay hundreds of dollars per year at allegedly inflated prices to watch their favorite team play. There’s no offering that allows them to just watch Chiefs games.
The NFL’s defense was multipronged. During opening statements, Beth Wilkinson, a lawyer for the NFL, stressed the league’s immense popularity, arguing that viewers are more than satisfied with its offerings, which she said includes NFL RedZone and NFL+.
“The NFL tries to provide as much football as they can to as many fans as possible. Why?” Wilkinson asked. “Because that builds a big fanbase. That’s why America’s favorite sport is football. They want to offer it to as many people as possible for the lowest possible cost.”
The league also pointed to other so-called procompetitive effects justifying the pooling of its teams’ broadcast rights, including the ability of CBS and Fox to air local games for free. Other leagues, the NFL argued, don’t do this to the detriment of their fans.
Under the league’s deal with CBS and Fox, there’s a single telecast for every Sunday afternoon NFL game, with the networks in turn being granted the exclusive right to broadcast a limited number of games through free, over the air TV in local markets. No more than two games can be broadcast at the same time in any given local market. This effectively provides the networks exclusive rights to certain games.
Consumers pressed arguments that the NFL engaged in a price-fixing scheme with DirecTV. In a 2012 email from Robert Stecklow, former director of sports strategy for DirecTV, wrote to an NFL executive, “Let’s make a decision in the room” and that the league “100% [has] agreed on pricing every year in a meeting just like yesterday.” Amanda Bonn, a lawyer for the consumers, said the correspondence indicates that the NFL annually secured advance notice of DirecTV’s prices for Sunday Ticket. “That’s price-fixing,” she said during opening statements. “That is illegal.”
In another message from Alex Kaplan, DirecTV’s director of revenue and product management, to a AT&T executive when the two companies were contemplating a merger that threatened the league’s ability to control prices, the executive wrote, “I have wanted to drop the price” of Sunday Ticket but the NFL rejected the request because the league “deem[ed] their product as a premium offering” and that “dropping the price would send a message that their product needs help.”
DirectTV wasn’t a defendant in the trial, with a judge in 2021 sending claims against the company to arbitration.
Lawyers for the consumers sought nearly $7 billion in damages. The NFL denied any wrongdoing.
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