There are 4.8 billion reasons why other leagues are watching the fallout from the Sunday Ticket case

LOS ANGELES (AP) — Professional sports leagues have 4.8 billion reasons to overhaul how they distribute out-of-market broadcasts following Thursday’s ruling against the NFL in a “Sunday Ticket” case in U.S. District Court.

“It’s going to require other leagues to take a hard look at their model and make sure that the means by which they’re providing consumers with choice are really providing real choice,” said Christine Bartholomew, associate dean and professor at the University at Buffalo Law School. “What happened here, at least in the jury’s opinion, was that the NFL really limited consumer choice. They not only pushed consumers into satellite TV, but they also pushed them into buying the whole package.”

A jury of five men and three women ruled that the NFL violated antitrust laws by distributing Sunday afternoon games, which were not broadcast locally on Fox or CBS, on a premium subscription service that had only one distributor. This kept the cost of the package high and limited the number of people who could sign up so as not to impact local ratings.

The class action lawsuit covers 2.4 million individual subscribers and 48,000 businesses in the United States that paid for a bundle of out-of-market games from the 2011-2022 seasons on DirecTV.

The jury awarded $4.7 billion in damages to the residential class and $96 million in damages to the commercial class. Because damages can be tripled under federal antitrust laws, the NFL could ultimately face liability of $14.39 billion.

Major League Baseball, the National Basketball Association and the National Hockey League also offer out-of-market packages, but they are structured differently than the NFL. All three are offered by cable and satellite TV, as well as streaming providers.

With their digital packages, MLB and NBA offer many options, including a team-by-team package. The NBA also offers a pay-to-play option.

The NHL digital package in the US is included with a subscription to the ESPN+ streaming service.

The MLB, NHL and NBA packages are also offered with a lower subscription fee than “NFL Sunday Ticket”, despite having longer seasons.

Ari Lightman, a professor of digital media and marketing at Carnegie Mellon University, said the NFL will need to become more responsive to consumer needs in the future.

“They need to understand different audiences in terms of where they exist, how fans interact and what they’re looking for,” he said. “They want things that are relevant and personalized to their needs, because everything they’re overpaying for is unwanted, and that’s the whole idea of ​​bundling. … The price that was offered in the ‘Sunday Ticket’ package was just a little bit too high.”

Some were also surprised that the NFL allowed the case to go to trial without a settlement. The league has not done well in antitrust cases, with most of them settling before they went to trial.

In 2010, the Supreme Court ruled in American Needle v. NFL that the league is a collection of 32 teams, not a single entity. The cap maker sued the NFL in 2004 for antitrust violations over its exclusivity agreement with Reebok that began in 2001.

Justice John Paul Stevens wrote in his opinion that “Although the NFL teams share common interests, such as promoting the NFL brand, they are distinct entities driven by the pursuit of profit.”

The NFL and American Needle finally settled the case in 2015.

Judge Philip S. Gutierrez is scheduled to hear post-trial motions on July 31, including the NFL’s request to enter a judgment in the league’s favor because the judge found the plaintiffs failed to prove their case.

The NFL has announced it will appeal the ruling. That appeal will go to the 9th Circuit Court of Appeals and then likely to the Supreme Court.

Payment of compensation and any changes to the Sunday Ticket package and/or the way the NFL broadcasts Sunday afternoon games will be suspended until all appeals are resolved.

During closing arguments, the plaintiffs presented a 2017 memo showing that the NFL was considering airing games not aired on Fox and CBS on cable channels.

There is also the possibility that the NFL will settle this matter sometime in the future. The lawsuit was originally filed in 2015 by San Francisco sports bar Mucky Duck, but was dismissed two years later by a U.S. District Court in Los Angeles. The 9th Circuit Court reopened the case in 2019.

“People were critical of the way the plaintiffs’ case was presented because of the complicated nature of the evidence. It was clearly the right strategy because they won,” said Irwin Kishner, co-chair of the Sports Law Group at the New York law firm Herrick. “And the NFL trying to attract wealthy owners may not have the best strategy. Hindsight is always 20/20.”