The NFL Faces a Major Legal Defeat with $4.8 Billion in Damages
The National Football League experienced a substantial setback in the court system on Thursday as a federal judge ruled against the league, ordering it to pay $4.7 billion in residential class damages. In addition to this hefty sum, the judge mandated an extra $96 million to be paid in commercial class damages. This monumental decision stems from a class-action lawsuit lingering in the courts for nearly a decade.
The NFL expressed immediate dissatisfaction with the jury's verdict, releasing a statement that read, "We are disappointed with the jury's verdict today in the NFL Sunday Ticket class action lawsuit. We continue to believe that our media distribution strategy...is by far the most fan-friendly distribution model in all of sports and entertainment. We will certainly contest this decision as we believe that the class action claims in this case are baseless and without merit." The league further thanked the jury for their time and service and acknowledged Judge Gutierrez's oversight throughout the trial.
This class-action lawsuit originally filed in 2015 revolves around the NFL's "Sunday Ticket" package, questioning whether the league violated antitrust laws by offering this exclusive package to consumers. "Sunday Ticket" launched in 1994 as a unique option for out-of-market fans eager to watch their home teams. The lawsuit scrutinizes this setup, scrutinizing all residential and commercial subscribers who used the service between 2012 and 2022, totaling nearly 2.5 million customers.
Plaintiffs had initially aimed to secure $7 billion in damages, and while the awarded amount fell short, it remains a significant blow to the NFL. Legal experts observe that pending an appeal to the 9th Circuit, this may lead to more scrutiny over exclusive sports broadcasting packages.
Amanda Bonn, representing the plaintiffs, lambasted the partnerships involved, stating, "NFL, Fox, and DirecTV agreed to make an expensive toll road that very few people would be able to afford." She continued by saying, "Every single competitor in this scheme benefited." This pointed criticism highlights the ongoing concern over competitive practices within the league's media distribution strategies.
Defending the NFL, attorney Beth Wilkinson responded, emphasizing consumer choice, "The case is about choice. This is a valuable, premium product. Think about all the choices available to fans. We want as many people as possible to watch the free broadcasts." This sentiment was echoed by Steve Bornstein, a former NFL executive, who noted, "The NFL always wanted 'Sunday Ticket' to be an additional package. That is how it was designed since its inception."
DirecTV, which held the "Sunday Ticket" rights from its inception in 1994 through 2022, transferred these rights to YouTube TV last season. These transitions add another layer to the ongoing debate about how sports broadcasting rights should be handled to ensure fair competition and accessibility for fans.
In a similar prior instance in 2021, the NFL settled with the city of St. Louis and several other entities for $790 million over the relocation of the Rams, demonstrating the league's ongoing legal battles over organizational decisions and their broader impacts.
As the NFL gears up for a hearing on July 31 for post-trial motions, including one to potentially overturn this hefty verdict, it becomes clear that the league's media strategy will remain under intense legal and public scrutiny. The case serves as a stark reminder of the complex interplay between lucrative media rights, fan accessibility, and legal compliance in professional sports.