NFL Ordered to Pay $4.8 Billion in Damages Over Antitrust Violations
In a landmark ruling, a Los Angeles federal jury has ordered the National Football League (NFL) to pay nearly $4.8 billion in damages for antitrust violations related to its “Sunday Ticket” programming. The verdict was delivered on June 27 in the U.S. District Court in the Central District of California after just one day of deliberations.
The lawsuit, filed in 2015 by the Mucky Duck sports bar in San Francisco, accused the NFL of conspiring with distributor DirecTV to raise prices for the “Sunday Ticket” package. This package allows viewers to watch out-of-market games but requires them to purchase access to a bundle of games. The plaintiffs argued that this arrangement resulted in the blackout or unavailability of out-of-market games unless consumers paid inflated prices for the “Sunday Ticket” package.
The jury awarded approximately $4.7 billion in damages to residential subscribers and $96 million to commercial subscribers such as restaurants and bars. Under federal antitrust laws, damages can be tripled, potentially making the NFL liable for $14.39 billion.
The ruling highlights the issue of monopolistic practices in professional sports broadcasting. The plaintiffs argued that the NFL’s elimination of competition in the broadcasting of its games allows the league and DirecTV to charge supracompetitive monopoly prices. They contended that this arrangement violates antitrust laws and results in substantial injury to competition.
The NFL, however, had sought to dismiss the lawsuit by invoking the Sports Broadcasting Act of 1961. This act allowed the league to sell its TV rights as a group, despite it consisting of 32 team owners who collectively own all the big TV rights. The league argued that the “Sunday Ticket” program was exempt from antitrust scrutiny under this act.
The NFL expressed disappointment with the verdict and reiterated its belief in its media distribution strategy. The league stated that its current distribution model, which includes broadcasting games on free over-the-air television in the markets of participating teams and national distribution of popular games, along with additional choices like RedZone, Sunday Ticket, and NFL+, is the most fan-friendly distribution model in all of sports and entertainment.
The NFL plans to appeal the ruling, which would take the case to the Ninth Circuit Court of Appeals and potentially to the Supreme Court. The league maintains that the class action claims in this case are baseless and without merit.
This ruling serves as a reminder of the ongoing challenges regarding the broadcasting rights and pricing structures in professional sports. It raises questions about the extent to which monopolies can be formed and maintained in the sports industry. As this case progresses, it will be interesting to see how the courts address these issues and what implications the ruling may have for future antitrust cases in the sports broadcasting arena.
