On Thursday, the NFL suffered a significant loss in a long-standing class-action lawsuit filed by "Sunday Ticket" subscribers, who challenged the NFL over alleged antitrust violations and the costs associated with the DirecTV "Sunday Ticket" broadcast package. The verdict, delivered in the U.S. District Court for the Central District of California, mandates the NFL to pay $96 million to commercial subscribers and $4.7 billion to residential subscribers.
As reported by USA Today, the class-action lawsuit was initiated by NFL fans in 2015, who accused the league of violating antitrust laws by limiting the distribution of "Sunday Ticket" exclusively to satellite provider DirecTV and thereby enabling inflated pricing. Originally, the case was dismissed but later revived by the 9th Circuit Court of Appeals in 2019. The plaintiffs argued that the NFL's approach restricted competition and forced consumers to pay high prices to watch out-of-market games. This setup contrasts with other professional sports leagues, where viewers have more flexible options to watch their preferred teams.
The plaintiffs sought damages amounting to $7.01 billion, highlighting the extensive impact on consumers over the years. However, damages can be tripled under antitrust law violations, potentially raising the NFL's liability to nearly $15 billion.
The NFL's defense emphasized the popularity and breadth of their media distribution strategy, which includes free over-the-air broadcasts, RedZone, Sunday Ticket, and NFL+. The league maintained that this approach is the most fan-friendly in sports and entertainment, offering extensive access at minimal cost. The NFL argued that the pooling of broadcast rights with CBS and Fox allowed local games to be aired for free, benefiting fans.
However, the plaintiffs presented evidence suggesting a price-fixing scheme between the NFL and DirecTV. Email correspondence indicated that the NFL had advance knowledge of DirecTV's pricing for Sunday Ticket, with league executives allegedly participating in decisions about pricing. This coordination, according to the plaintiffs, constituted illegal price-fixing.
The trial began on June 6 in Los Angeles, with jury deliberations commencing on Wednesday. Notable testimonies included those of NFL commissioner Roger Goodell and Dallas Cowboys owner Jerry Jones. Despite the jury's decision, the NFL has expressed its intention to appeal, asserting the class action claims are baseless and without merit.
Meanwhile, DirecTV's exclusive contract with the NFL ended after the 2022 season, with Google, the parent company of YouTube TV, securing a seven-year deal for Sunday Ticket starting with the 2023 season. Notably, neither Google nor YouTube TV were defendants in this trial.
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