Judge Expresses Frustration Over NFL 'Sunday Ticket' Lawsuit
LOS ANGELES -- The federal judge overseeing the class-action lawsuit filed by "Sunday Ticket" subscribers against the NFL voiced his frustrations Tuesday about how the plaintiffs' attorneys are managing their side of the case.
A Straightforward Case Turned Complex
Before Dallas Cowboys owner Jerry Jones took the stand for his second day of testimony, U.S. District Judge Philip Gutierrez emphasized the straightforward nature of the case. He highlighted the frustration of a Seattle Seahawks fan living in Los Angeles, who cannot view their favorite team without subscribing to the entire package of Sunday afternoon out-of-market games.
The class-action lawsuit encompasses 2.4 million residential subscribers and 48,000 businesses that paid for the package of out-of-market games from the 2011 through 2022 seasons. The lawsuit claims that the NFL broke antitrust laws by selling its package of Sunday games aired on CBS and Fox at an inflated price. Additionally, subscribers argue that the league restricted competition by offering "Sunday Ticket" exclusively through a satellite provider.
Antitrust Exemption and Potential Damages
The NFL firmly 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 and not pay-TV. Should the NFL be found liable, a jury could award up to $7 billion in damages, which could balloon to $21 billion due to the triple damages provision often applicable in antitrust cases.
Tuesday's session was not the first instance Judge Gutierrez expressed his disappointment with the plaintiffs' attorneys. On Monday, he chastised them for repeatedly describing past testimony, considering it a waste of time.
Contentious Points and Key Witnesses
Before Jones resumed his testimony, Judge Gutierrez expressed skepticism about the plaintiffs' attorneys citing Jerry Jones' 1995 lawsuit against the NFL, which challenged the league's licensing and sponsorship procedures. Both sides eventually settled out of court. Jones filed the 1994 lawsuit, asserting that while he supported the league's model for negotiating television contracts and revenue-sharing agreements, he contested its licensing and sponsorship procedures.
When asked Tuesday whether teams should be able to sell their out-of-market television rights, Jones replied that they should not, as it "would undermine the free TV model we have now."
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 has in local markets. CBS and Fox both requested during negotiations that "Sunday Ticket" be sold as a premium package.
Pricing and Contract Clauses
DirecTV, not the NFL, set the prices during the class-action period. The league's television contracts with CBS and Fox stipulated 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." Additional language prohibits selling individual games on a pay-per-view basis.
From 1994 through 2022, the NFL received a rights fee from DirecTV for the package. Starting last year, Google's YouTube TV acquired "Sunday Ticket" rights for seven seasons. During a deposition, DirecTV marketing official Jamie Dyckes stated 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.
Future Proceedings and Possible Outcomes
Testimony will continue Thursday, with closing statements scheduled for early next week. Judge Gutierrez mentioned he would consider invoking a rule allowing the court to find that a jury lacks sufficient evidence to rule for a party in a case.
Judge's Remarks and Implications
Gutierrez candidly admitted, "I'm struggling with the plaintiffs' case." His comments throughout the proceedings reflect his mounting 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," adding, "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.