The NFL may have scored a come-from-behind win last month when a federal judge wiped out a multibillion dollar class action jury victory for NFL Sunday Ticket subscribers who contend they have been illegally overcharged, but the U.S. Court of Appeals for the Ninth Circuit—which five years ago sided against the NFL in this litigation—could reverse that win.
As expected, attorneys for the subscribers have appealed U.S District Judge Philip S. Gutierrez’s decision to grant the NFL a judgment as a matter of law in the In Re: NFL’s “Sunday Ticket” Antitrust Litigation. Gutierrez found that a Los Angeles jury, which over a three-week trial heard from 27 witnesses and saw 82 admitted exhibits, did what “no reasonable jury” could have done in this case: find class-wide injury and damages against the NFL.
The jury reasoned that the NFL and its 32 teams, which as competing businesses are supposed to compete under antitrust law, violated antitrust law by pooling broadcasting rights for out-of-town fans. While local fans of NFL teams can watch their team’s games freely and over-the-air–unlike local fans of NBA, NHL or MLB teams, which require their local fans to pay to watch games on regional sports networks via cable or satellite–out-of-town fans need to buy the Sunday Ticket. The Ticket gives fans access to all games for all teams and for the 2024 season costs $479 via YouTube TV (the price is much lower for college students—$199—and can be lower through various other discounts/packages, though bars and restaurants pay more to offer it to customers).
As the plaintiffs tell it, if NFL teams individually sold their out-of-town broadcasting rights, their games would be watchable for less than the cost of the Sunday Ticket. Imagine, for example, a New York Giants fan living in Los Angeles. The Giants could arrange to broadcast their games on a LA television station and the Giants fan would then not have to pay or at least pay less than the cost of the Sunday Ticket to watch the games the fan cares about.
The NFL bluntly rejects this hypothesis, noting that without the pooling of games, fans in some locations won’t be able to watch their favorite team (think of a New Orleans Saints fan living in Vermont) or if they can watch the game, it could be pricey. The league has also warned that the economics of broadcasting freely to local fans would be reconsidered without the Sunday Ticket.
The jury was more persuaded by the plaintiffs’ attorneys, who represent more than 2.4 million residential subscribers and more than 48,000 restaurants, bars and other commercial establishments that purchased Sunday Ticket anytime between 2011 to 2023. The jury awarded $4.6 billion and $97 million to the residential subscribers and commercial establishments, respectively, and with antitrust law damages eligible for trebling, the NFL and owners faced the prospect of paying a judgment as high as $14.1 billion.
But Gutierrez agreed with the NFL that the jurors were bewildered and misled during the trial. Jurors apparently confused the term “overcharge” with a “discount,” in that they appeared to punish the NFL for the difference in price between the list price and the (lower) price actually paid by subscribers after discounts. Gutierrez also concluded jurors were bamboozled by plaintiffs’ expert testimony that, to determine market prices, incorporated hypothetical scenarios. For instance, jurors were told to imagine if broadcasts to NFL games were distributed like broadcasts to college football games, with the basic conclusion that more NFL games would be made available to out-of-town fans who don’t subscribe to the Sunday Ticket. Gutierrez reasoned this testimony was misleading since it doesn’t sufficiently establish that NFL teams would make games available to cable and satellite customers. Sportico recently found that it costs $788 to watch every NFL game on TV without cable.
The litigation began in 2015, and in 2019 a divided three-judge panel on the Ninth Circuit reversed a trial court’s dismissal of the case. An opinion authored by Judge Sandra Segal Ikuta reasoned that a league-wide agreement to prevent individual teams from selling out-of-town broadcast rights appears to unduly interfere with teams’ autonomy and reduce viewing options for fans. She stressed that in NCAA v. Board of Regents, the U.S. Supreme Court found an (arguably) analogous restraint by the NCAA on individual colleges selling broadcast rights to violate antitrust law. The NCAA’s restraint prevented college teams, including those that fans wanted to watch, from negotiating their own TV deals.
Attorneys for Sunday Ticket subscribers hope the Ninth Circuit will side with them once again and revive the case by reversing Gutierrez. But they’ll have to wait a while. Ninth Circuit appeals are usually slow-moving, with parties often waiting a couple of years from the filing of an appeal to a decision. It’s always possible the parties could negotiate a settlement at some point, though after nearly a decade in court, it’s telling there’s been no settlement.
There’s a chance the Ninth Circuit won’t have the final word on the litigation, either. In 2020, the NFL denied the league’s petition for certiorari for review of the Ninth Circuit’s ruling. However, Justice Brett Kavanaugh added a comment that suggested he and other justices were interested in the underlying antitrust questions.
Kavanaugh reasoned that while teams in pro leagues are competing businesses, they should be accorded some discretion in coordinating their activities and pooling their resources—such as broadcasting rights—to advance the league’s overarching interests. Should the Ninth Circuit side against the NFL again, the league might find hope in Kavanaugh writing “antitrust law likely does not require that the NFL and its member teams compete against each other with respect to television rights.”
