The NFL faced a significant legal defeat on Thursday as a federal judge ruled against the league in a class-action lawsuit related to its "Sunday Ticket" package. The court's decision mandates the NFL to pay $4.7 billion in residential class damages and an additional $96 million in commercial class damages. This ruling marks a substantial financial hit for the league and could have far-reaching implications on the structure of exclusive sports broadcasting packages.
The class-action lawsuit, which has been winding its way through the court system for nearly a decade, was originally filed in 2015. At the heart of the lawsuit is the NFL's "Sunday Ticket" package, a service that launched in 1994 to cater to out-of-market fans eager to watch their favorite teams. The lawsuit alleges that the NFL violated antitrust laws through the manner it bundled and sold the "Sunday Ticket" package.
Amanda Bonn, representing the plaintiffs, stated, "NFL, Fox, and DirecTV agreed to make an expensive toll road that very few people would be able to afford. Every single competitor in this scheme benefited." The plaintiffs accused the NFL of restricting consumer choice by forcing fans to buy the "Sunday Ticket" package through exclusive channels, thereby inflating prices.
The lawsuit covered residential and commercial subscribers to the "Sunday Ticket" service from 2012 to 2022, encompassing nearly 2.5 million customers. Initially, the plaintiffs sought $7 billion in damages, a sum significantly higher than the almost $5 billion awarded by the court.
In response to the ruling, the NFL expressed its disappointment through an official statement: "We are disappointed with the jury's verdict today in the NFL Sunday Ticket class action lawsuit. We continue to believe that our media distribution strategy... is by far the most fan-friendly distribution model in all of sports and entertainment. We will certainly contest this decision as we believe that the class action claims in this case are baseless and without merit."
During the trial, an attorney for the NFL, Beth Wilkinson, argued that the "Sunday Ticket" package provided numerous options for fans to watch games, countering allegations that it limited consumer choice: "The case is about choice. This is a valuable, premium product. Think about all the choices available to fans. We want as many people as possible to watch the free broadcasts."
Another angle presented by the NFL's defense highlighted the historical context and intended purpose of the "Sunday Ticket" package. Steve Bornstein, former head of NFL Network, mentioned, "The NFL always wanted 'Sunday Ticket' to be an additional package. That is how it was designed since its inception."
DirecTV held the rights to the "Sunday Ticket" package from its inception in 1994 until 2022, after which the rights were transferred to YouTube TV last season. This transfer indicates the evolving landscape of sports broadcasting and digital streaming, factors that could weigh heavily on the NFL's appeal to the 9th Circuit. Should the appeal proceed, it may lead to increased scrutiny over similar exclusive packages in sports and other entertainment sectors.
This legal setback for the NFL follows its $790 million settlement with the city of St. Louis and other entities over the relocation of the Rams in 2021, suggesting a period of significant financial and legal challenges for the league. The ramifications of the recent judgment could influence how sports franchises and broadcasters negotiate their partnerships and distribution rights in the future.
A hearing for post-trial motions is set for July 31, which will include discussions on potentially overturning the current verdict. As the NFL navigates through this legal quagmire, the ongoing developments and ultimate resolution of the appeal will be closely watched by stakeholders and fans alike.