Class-Action Lawsuit Against NFL Sparks Judge's Frustration
LOS ANGELES -- In the ongoing class-action lawsuit filed by "Sunday Ticket" subscribers against the NFL, U.S. District Judge Philip Gutierrez has made no secret of his frustrations with how the plaintiffs' attorneys are conducting their case. The suit, brought by a wide base of football fans, asserts that the NFL broke antitrust laws by selling its package of Sunday games aired on CBS and Fox at an inflated price and unfairly restricting competition by offering "Sunday Ticket" only through a satellite provider.
A Straightforward Premise
Before Dallas Cowboys owner Jerry Jones took the stand for a second day of testimony, Judge Gutierrez expressed that the fundamental premise of the case was clear-cut. He highlighted the ordeal of a Seattle Seahawks fan living in Los Angeles, unable to watch their favorite team unless they purchased a subscription covering all Sunday afternoon out-of-market games. The class-action lawsuit represents 2.4 million residential subscribers and 48,000 businesses who paid for the out-of-market games package from the 2011 through 2022 seasons.
Should the NFL be found liable, potential damages could reach up to $7 billion, which might escalate to $21 billion due to the triple damages stipulation in antitrust cases. Yet, the judge's confidence in the plaintiffs' approach seems to be waning.
Judge Gutierrez's Critique
This week has seen Judge Gutierrez vocally critique the plaintiffs' attorneys. On Monday, he admonished them for repeatedly recapping past testimonies, calling it a waste of time. By Tuesday, as Jerry Jones resumed his testimony, Gutierrez expressed skepticism about referencing Jones' 1995 lawsuit against the NFL, which challenged the league's licensing and sponsorship procedures.
The 1994 lawsuit filed by Jones argued for the right of teams to negotiate television contracts and sponsorship agreements independently of the league. Both parties eventually settled out of court. However, when questioned on Tuesday about teams selling their out-of-market television rights independently, Jones maintained that they should not, as it "would undermine the free TV model we have now."
Broadcast and Pricing Disputes
Retired CBS Sports chairman Sean McManus also testified, reiterating his longstanding opposition to "Sunday Ticket" and the NFL's Red Zone channel. According to McManus, "Sunday Ticket" infringes on the exclusivity CBS holds in local markets. Both CBS and Fox had requested during negotiations that "Sunday Ticket" be marketed as a premium package. Notably, DirecTV, and not the NFL, set the prices during the class-action period.
The language in the NFL’s television contracts with CBS and Fox supports this approach, stipulating that "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." Additionally, the contracts prohibit selling individual games on a pay-per-view basis.
From 1994 through 2022, DirecTV paid a rights fee to the NFL for the package. Starting last year, Google’s YouTube TV acquired "Sunday Ticket" rights for a seven-season period. DirecTV marketing official Jamie Dyckes provided insight during a deposition, noting that MLB, the NBA, and the NHL all had suggested retail prices for their out-of-market packages, with revenue sharing between the leagues and the carriers since their packages were distributed across various platforms.
Uncertain Conclusion
Judge Gutierrez mentioned the possibility of invoking a rule that would allow the court to determine that a jury lacks sufficient evidence to rule in favor of a party, signaling his continued doubts about the plaintiffs' case. As testimony proceeds with closing statements slated for early next week, the courtroom remains on edge, anticipating whether the plaintiffs' attorneys can deliver a compelling argument aligned with the straightforward premise Gutierrez had initially emphasized.
Judge's Stark Commentary
Judge Gutierrez has been candid throughout the proceedings, stating, "I'm struggling with the plaintiffs' case" and noting how the case has strayed from its straightforward essence. His frustration culminated in the remark, "This case has turned into 25 hours of depositions and gobbledygook," expressing that "This case has gone in a direction it shouldn't have gone."
As the trial progresses, all eyes remain on how the plaintiffs' side adjusts their tactics to meet the judge's expectations. The outcome could have far-reaching implications not just for the NFL and its broadcasting rights but also for how professional sports leagues negotiate and price their television packages.