Antitrust blitz: NFL ruling on Sunday tickets could have broad implications for all professional sports

On June 27, a jury in the U.S. District Court for the Central District of California issued a multi-billion dollar verdict in favor of restaurant/bar owners and consumers and against the National Football League (NFL) in connection with the NFL’s Sunday Ticket. Sunday Ticket is a product offered by the NFL since 1994 and distributed exclusively through broadcast partner DirectTV, in which a bundle of games is offered nationwide to out-of-market fans interested in watching their home teams’ games and to restaurants/bars that want to offer this option to local fans. As the plaintiffs in the lawsuit allege, the bundle of games “can be sold nationwide, enabling the NFL and its teams to offer a single, captive product containing a variety of products they would otherwise sell separately.”

Before we get into what the NFL Sunday Ticket decision means if it survives the slew of post-trial motions and appeals that are expected to follow, let’s take a look at how the NFL got to this point. Professional sports leagues have been under scrutiny for their actions under Sections 1 and 2 of the Sherman Antitrust Act for more than a century. The first major sport to address the issue was baseball, with the U.S. Supreme Court unanimously ruling that Major League Baseball (MLB) was exempt from the Sherman Act more than a century ago. Interestingly, when it came to baseball, affectionately and historically called “America’s Pastime,” the court found that there was no interstate commerce and therefore no violation of the Sherman Act, despite the court acknowledging in the same decision that:

“Each club in the league makes a profit not only by its ability to attract its own team at home, but also by the ability of the teams of the clubs which its team visits in the various cities of the league. … The continuous interstate operation of each club is essential to all the others. The clubs of each league constitute a business unit extending territorially over several different states.”