Closing Arguments in NFL "Sunday Ticket" Class-Action Lawsuit
The jury in the high-stakes class-action lawsuit filed by "Sunday Ticket" subscribers against the NFL is expected to begin deliberations on Wednesday after both sides wrapped up their cases on Monday. The lawsuit, representing 2.4 million residential subscribers and 48,000 businesses, alleges that the NFL violated antitrust laws by selling its package of Sunday games aired on CBS and Fox at inflated prices while limiting competition by exclusively offering "Sunday Ticket" through a satellite provider.
Final Preparations and Legal Maneuvers
U.S. District Judge Philip Gutierrez is scheduled to hold a conference with attorneys for both sides on Tuesday morning to finalize the jury instructions. In addition, Gutierrez might hear a motion from the NFL on Tuesday afternoon to grant judgment as a matter of law to the league, arguing that the plaintiffs failed to provide sufficient evidence.
On Wednesday morning, Gutierrez will present the final instructions to the jury, composed of five men and three women, before the final arguments commence. Both sides will receive 1 hour and 10 minutes to make their closing statements, with the plaintiffs having an additional 20 minutes reserved for rebuttal.
Expert Testimony and Key Arguments
The NFL's final witness, Stanford economics professor B. Douglas Bernheim, concluded his testimony on Monday morning. Bernheim reiterated the NFL's stance that selling out-of-market Sunday afternoon games on Fox and CBS to DirecTV from 1994 to 2022, and subsequently to Google YouTube TV, benefits fans and ensures competitive balance on the playing field. According to Bernheim, this relationship helps fuel competitive parity in the league, ensuring smaller-market teams remain financially viable.
Countering Bernheim's testimony, Harvard professor Einer Elhauge, the plaintiffs' rebuttal witness, argued that no significant links exist between the league's constraints to make "Sunday Ticket" a premium package and fostering competitive balance. Elhauge testified that the roughly $62.5 million each team receives annually from "Sunday Ticket" wouldn't dramatically impact the league’s salary cap or individual teams' operating budgets.
Dallas Cowboys owner Jerry Jones also testified last week, stating he wouldn’t support a salary cap if he could sell his out-of-market rights independently. This comment underscores the plaintiffs' argument that the NFL's exclusive arrangement with DirecTV limited the potential revenue streams for individual teams.
The Crux of the Case
The lawsuit claims that the NFL broke antitrust laws by selling its package of Sunday games at inflated prices, limiting competition by offering "Sunday Ticket" exclusively through a satellite provider. The plaintiffs contend that this arrangement hurt consumers, who had to pay high prices for access to out-of-market games. Additionally, they argue that it restricted other potential distributors from entering the market.
The NFL, on the other hand, argues that it retains the right to sell "Sunday Ticket" under its antitrust exemption for broadcasting. They assert that this exemption, granted by Congress, allows the league to centralize its broadcasting rights and sell them as a package, which they claim has historically benefited the fans and the league's competitive balance.
However, the plaintiffs argue that this exemption only applies to over-the-air broadcasts, not pay TV, and thus does not cover the "Sunday Ticket" package sold through DirecTV and subsequently YouTube TV.
Potential Implications and Future Legal Battles
If the jury finds the NFL liable, the financial implications could be monumental. The jury could award damages of $7 billion, a figure that could be tripled to $21 billion due to the antitrust nature of the case. This potential outcome underscores the significance of the case, not just for the NFL but for the broader sports broadcasting landscape.
Originally filed in 2015 by the Mucky Duck sports bar in San Francisco, the lawsuit faced initial dismissal in 2017. However, the 9th Circuit Court of Appeals, which has jurisdiction over California and eight other states, reinstated the case two years later. Judge Gutierrez sanctioned the proceeding as a class action last year, allowing it to represent the millions of "Sunday Ticket" subscribers.
Regardless of the decision, the losing side is anticipated to appeal, potentially escalating the case to the 9th Circuit and possibly even the Supreme Court. This prolonged legal battle could have far-reaching implications for how sports leagues package and sell their broadcasting rights and may reshape the landscape of televised sports.
As the jury prepares to deliberate, all eyes remain focused on the courtroom. The upcoming verdict promises to be a critical juncture in a long-standing legal battle, casting the future of sports broadcasting and the legality of exclusive distribution deals into question.