What you should know about the class action lawsuit filed by Sunday Ticket subscribers against the NFL

LOS ANGELES (AP) — A federal court could decide how the NFL can distribute its package of out-of-market games as part of a class action lawsuit.

Subscribers to the NFL’s “Sunday Ticket” package claim the league violated antitrust laws by selling its package of out-of-market Sunday afternoon games broadcast on CBS and Fox at an inflated price, the lawsuit says. Subscribers also claim the league restricted competition by offering “Sunday Ticket” only through a satellite provider.

The NFL claims it has the right to sell Sunday Ticket under its broadcast antitrust exemption. Plaintiffs say that applies only to over-the-air broadcasts, not pay TV.

The trial began on June 6 in Los Angeles. Closing arguments are expected next week.

How did this case come to court?

The lawsuit was originally filed in 2015 by San Francisco sports bar Mucky Duck. On June 30, 2017, U.S. District Judge Beverly Reid O’Connell dismissed the suit, ruling in favor of the NFL, saying Sunday Ticket had not reduced its broadcast of NFL games and that while DirecTV may have charged excessive prices, that “alone does not constitute an anticompetitive measure” because the company must negotiate with the NFL to carry the package. Two years later, the 9th Circuit Court of Appeals, which covers California and eight other states, reopened the case. On February 7, 2023, U.S. District Judge Philip Gutierrez ruled that the case could proceed as a class action lawsuit. Gutierrez rejected a final attempt by the NFL to dismiss the case on January 12.

Who are the plaintiffs?

The class action lawsuit affects more than 2.4 million private customers and 48,000 businesses, primarily bars and restaurants, that purchased NFL Sunday Ticket from June 17, 2011, to February 7, 2023. Last season, Google’s YouTube TV became the Sunday Ticket provider.

What are the NFL’s odds of winning?

The NFL may be the queen of American sports and one of the most powerful leagues in the world, but it often loses in court, especially in Los Angeles. In 1982, a federal court in Los Angeles ruled that the league had violated antitrust laws by not allowing Al Davis to move the Raiders from Oakland to Los Angeles.

This is one of the rare instances in which a high-profile case involving league financial affairs has gone to trial without the NFL first reaching a settlement. In 2021, the league settled with St. Louis, St. Louis County and the St. Louis Regional Convention and Sports Complex Authority for $790 million in connection with the Rams’ move to Los Angeles.

Why the NFL could lose

Memos from the plaintiffs’ attorneys show that Fox and CBS have always wanted the league to charge higher prices for Sunday Ticket so that local ratings would not suffer – because the more subscribers there are to Sunday Ticket, the greater the risk to local viewership.

In her opening statements, attorney Amanda Bonn showed a 2020 Fox Sports term sheet that requires the NFL to ensure the price of Sunday Ticket is above $293.96 per season.

When the 2022 Sunday Ticket contract came up for bid, ESPN wanted to offer the package on its streaming service for $70 per season and also offer a team-by-team product, according to an email provided by Bonn. That was rejected by the NFL.

Why the NFL could win

The subscribers’ lawyers made the case more complicated than it should be, the judge said. Instead of calling some of the fans or Jason Baker, the owner of the Mucky Duck, they relied on economists who gave complicated testimony.

Gutierrez expressed his frustration about the case, telling the plaintiffs’ attorneys: “The way you have brought this case to trial is anything but simple. This case has turned into 25 hours of testimony and gibberish.”

Who has testified so far?

NFL Commissioner Roger Goodell took the witness stand on June 17 for the first time since taking office in 2006. Dallas Cowboys owner Jerry Jones, retired CBS Sports chairman Sean McManus and Fox Sports executive vice president Larry Jones also testified.

Daniel Rascher, a sports economist at the University of San Francisco, was called as an expert witness by the subscribers’ lawyers.

How much could this cost the NFL?

If the NFL is found liable, a jury could award $7 billion in damages. However, that amount could rise to $21 billion because damages in antitrust cases can triple.

But when would the league have to pay out the money to the subscribers?

Not anytime soon, as the NFL will appeal to the 9th Circuit and possibly the Supreme Court.

In what other ways can “Sunday Ticket” subscribers find cheaper prices?

The NFL could offer packages for each team, as Major League Baseball and the NBA do for their out-of-market packages, and actively market a weekly package if fans don’t like the way the games are broadcast in their area.

Could this have an impact on other sports?

Since all major leagues offer out-of-market packages, they are keeping an eye on this case, as selling the out-of-market streaming rights of individual teams, especially in baseball, would further increase the divide between rich and poor.

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