The NFL could be on the hook for a substantial $6.1 billion payout if a class-action antitrust lawsuit against the league gains traction.
A federal judge in California recently dismissed the NFL’s attempt to have the lawsuit thrown out, stating that there is a plausible argument regarding whether the league violated the federal Sherman Anti-Trust Act in its dealings with DirecTV for “NFL Sunday Ticket,” as reported by Deadline.
“NFL Sunday Ticket” enables viewers to pay for access to games outside their local television markets, and the Sherman Anti-Trust Act of 1890 is in place to curb monopolistic practices by companies. The lawsuit, initiated in 2015, represents around 2.4 million residential class subscribers and nearly 50,000 establishments in the commercial class who were Sunday Ticket subscribers. The crux of the case revolves around the claim that these subscribers were compelled to pay inflated prices to the NFL to watch out-of-market games on DirecTV’s Sunday Ticket package.
In 2022, the NFL entered into a deal with YouTube to carry “Sunday Ticket” instead of DirecTV, which held the rights from 2011 to 2022. The cost for the 2023 regular season on YouTube was $399 for those without a YouTube TV subscription.
U.S. District Judge Philip Gutierrez, after reviewing arguments from both the plaintiffs and the league, ruled that the question of whether an illegal monopoly exists must proceed to a jury trial. The judge determined that DirecTV, based on agreements with the NFL, was able to charge “supracompetitive prices for Sunday Ticket because fans unwilling to pay for Sunday Ticket cannot, for example, purchase out-of-market games individually or by team.”
Gutierrez pointed out that a team like the Los Angeles Rams could individually stream its games to out-of-market viewers, but due to the NFL’s pooling of all teams’ rights and exclusive coverage agreements with DirecTV and now YouTube, such options are restricted.
The judge also addressed an antitrust law exemption related to broadcast rights that the NFL successfully lobbied Congress to pass in 1961. While the exemption pertained to free over-the-air telecasts, Gutierrez emphasized that it did not cover “paid telecasts” through streaming, a concept that did not exist in 1961.