NFL On Trial In $21B Antitrust Class Action

The NFL is currently embroiled in a high-stakes antitrust battle over media rights. 

Here are the key details:

Case Overview: According to Front Office Sports the trial, which began in Los Angeles, involves a class-action antitrust case that has been nearly a decade in development. The plaintiffs consist of more than 2.4 million residential and 48,000 commercial subscribers to NFL Sunday Ticket on DirecTV1. They are seeking to hold the league liable and claim damages of up to $7 billion. Under federal rules, this figure could potentially triple, resulting in a total bill of $21 billion for the NFL.

Allegations: The plaintiffs argue that the current structure of NFL Sunday Ticket artificially drives up prices. Residential packages now start at $349 per year, and the plaintiffs contend that this pricing model is unfair.

Potential Impact: If the plaintiffs prevail, NFL teams could gain the freedom to negotiate their own individual and market-specific out-of-market rights deals. Consumers might also have the ability to purchase individual games or team-specific packages. On the other hand, the league is likely to present NFL Sunday Ticket as a premium-level product that expands consumers’ access to games.

Key Figures: The trial could lead to key figures such as NFL Commissioner Roger Goodell, Cowboys owner Jerry Jones, Patriots owner Robert Kraft, and former CBS Sports chairman Sean McManus being called to testify. This could provide rare insights into how the league develops crucial business contracts.

Unique Approach: Unlike some other major leagues, the NFL has not allowed team-specific options for out-of-market game packages. Even as the residential portion of NFL Sunday Ticket has moved to YouTube (worth $14 billion over seven years), the streamer is not a defendant in the lawsuit.

Courthouse News reports the NFL will try to persuade the jury that its football game telecasts are "a high-quality and popular entertainment product" based on the combined efforts of the league and its broadcast partners, and that Sunday Ticket "expands output by providing avid fans with a high-quality option to ensure access to live telecasts of all Sunday afternoon NFL games."

The league will also seek to introduce evidence through an expert witness that, contrary to what the plaintiffs claim, its way of showing games provides consumers with more benefits than other professional sports leagues, such as MLB and the NBA, including by showing more free, over-the-air games.

The plaintiffs, represented by veteran litigator Marc Seltzer and Bill Carmody of Susman Godfrey among a bevy of other attorneys, also seek an injunction to stop the allegedly anticompetitive arrangement, which could upend the NFL's exclusive deal with Google. Any such injunction won't be handed down by the jury but will have to come from the judge.