Legal Battle Over NFL's "Sunday Ticket" Continues
LOS ANGELES -- The federal judge overseeing the class-action lawsuit filed by "Sunday Ticket" subscribers against the NFL expressed frustration on Tuesday over how the plaintiffs' attorneys are handling their case.
Judge's Frustration
Before Dallas Cowboys owner Jerry Jones took the stand for a second day of testimony, U.S. District Judge Philip Gutierrez emphasized that the case's premise was straightforward. The judge acknowledged the frustrations of a Seattle Seahawks fan living in Los Angeles who cannot watch their favorite team without purchasing a subscription for all the Sunday afternoon out-of-market games.
The lawsuit covers 2.4 million residential subscribers and 48,000 businesses who paid for the package of out-of-market games from the 2011 through 2022 seasons. The plaintiffs claim that the NFL violated antitrust laws by selling its package of Sunday games aired on CBS and Fox at an inflated price. Additionally, the subscribers argue that the league restricted competition by offering "Sunday Ticket" only through a satellite provider.
The NFL maintains that it has the right to sell "Sunday Ticket" under its antitrust exemption for broadcasting. However, the plaintiffs counter that this exemption only applies to over-the-air broadcasts, not pay TV. If the NFL is found liable, a jury could award up to $7 billion in damages, a figure that could triple to $21 billion due to the nature of antitrust cases.
Previous Tensions
This week was not the first time Judge Gutierrez expressed his frustrations with the plaintiffs' side. On Monday, he chastised their attorneys for repeatedly describing past testimony, which he considered a waste of time. Before Jones resumed his testimony, Gutierrez expressed doubts about the plaintiffs' attorneys citing Jerry Jones' 1995 lawsuit against the NFL, which challenged the league's licensing and sponsorship procedures. That lawsuit was eventually settled out of court.
Jerry Jones filed the 1994 lawsuit against the NFL while supporting the league's model for negotiating television contracts and the revenue-sharing agreements in place. However, he contested its licensing and sponsorship procedures. When asked if teams should be able to sell their out-of-market television rights, Jones responded that they should not, as it "would undermine the free TV model we have now."
Testimonies from NFL and Broadcasting Executives
Retired CBS Sports chairman Sean McManus also took the stand, reiterating his long-standing opposition to "Sunday Ticket" and the NFL's Red Zone channel. McManus believes that "Sunday Ticket" infringes on the exclusivity CBS holds in local markets. Both CBS and Fox requested during negotiations that "Sunday Ticket" be sold as a premium package. DirecTV, not the NFL, set the prices during the class-action period.
The league's contracts with CBS and Fox specify that the "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." The contracts also prohibit selling individual games on a pay-per-view basis. From 1994 through 2022, the NFL received a rights fee from DirecTV for the package. Last year, Google’s YouTube TV acquired "Sunday Ticket" rights for seven seasons.
During a deposition, DirecTV marketing official Jamie Dyckes noted that MLB, the NBA, and the NHL had a suggested retail price for their out-of-market packages. Dyckes added that there was revenue sharing between the leagues and the carriers, as their packages were distributed across multiple platforms.
Proceedings and Future Outlook
Testimony will continue Thursday, with closing statements scheduled for early next week. Judge Gutierrez has hinted at the possibility of invoking a rule that allows the court to determine that a jury lacks sufficient evidence to rule for a party in a case.
Quotes Reflecting Frustration
Gutierrez candidly admitted, "I'm struggling with the plaintiffs' case." Throughout the proceedings, his comments have reflected his growing frustrations, stating, "The way you have tried this case is far from simple." He also remarked, "This case has turned into 25 hours of depositions and gobbledygook," and added, "This case has gone in a direction it shouldn't have gone."
As the case progresses, all eyes will remain on the courtroom, anticipating whether the plaintiffs' attorneys can present a compelling argument that aligns with the straightforward premise Judge Gutierrez initially outlined.