“Sunday Ticket” subscribers sued the NFL in a class action lawsuit, but a federal judge on Thursday reversed the jury’s $4.7 billion decision and gave the league judgment.
U.S. District Judge Philip Gutierrez determined that two witnesses for the subscribers provided inaccurate evidence and should have been omitted.
According to Gutierrez, the testimony of Drs. Daniel Rascher and John Zona were crucial in reaching the conclusion that there was class-wide harm or damage. This conclusion was reached after a 16-page order.
On June 27, a jury awarded $4.7 billion in damages to residential and business subscribers, ruling that the NFL violated antitrust rules by delivering out-of-market Sunday afternoon games via a premium subscription service.
The case encompassed 2.4 million residential users and 48,000 companies in the United States who paid for DirecTV’s out-of-market game package from 2011 to 2022.
“We are grateful for today’s ruling in the Sunday Ticket class action lawsuit,” the NFL stated in a statement. “We feel that the NFL’s media distribution model gives our fans a variety of ways to watch the game they love, including local broadcasts of every game on free over-the-air television. We appreciate Judge Gutierrez’s work and attention to this issue and look forward to a great 2024 NFL season.”
The lawyers who are representing the “Sunday Ticket” subscribers did not reply any of our calls or emails.
The verdict was $4,610,331,671.74 for the residential class (home subscribers) and $96,928,272.90 for the commercial class (business subscribers) handed out by a jury of five male and three female jurors.
Because damages may be quadrupled under federal antitrust rules, the NFL might have been held accountable for $14,121,779,833.92.
Gutierrez said in his conclusion that if he had not ruled for the NFL as a matter of law, he would have overturned the jury’s damages finding and conditionally awarded a new trial “based on the jury’s irrational damages award.”
A college football model served as the basis for Rascher’s models. Rascher, an economist from the University of San Francisco, said during his evidence that “they figured it out in college sports, [so] they would certainly figure it out in the NFL.”
Gutierrez said that Rascher’s evidence “was not the product of sound economic methodology” and that Rascher should clarify how out-of-market broadcasts might have been accessible on satellite and cable without the requirement for an extra subscription.
Gutierrez also discovered flaws in Zona’s “multiple distributor” models, which predicted that consumers would have paid more if another service besides DirecTV offered “Sunday Ticket” and made an unsupported assumption that another distributor — either cable, satellite, or streaming — would have been available.
“Without knowing what ‘direct-to-consumer’ meant, it is impossible to determine if it would have been economically rational for consumers to purchase ‘Sunday Ticket’ from an alternative distributor at a higher price,” said Gutierrez. “And that definition was required to determine whether a viable alternative distributor existed during the class period.” Without such knowledge, the Court is unable to evaluate whether the but-for worlds without exclusivity were accurately represented.”
The jury’s number also did not match Rascher’s ($7.01 billion) or Zona’s ($3.48 billion) models, who were expert witnesses in the case.
Instead, the jury used the 2021 list price of $293.96 and removed $102.74, which was the average price paid by residential “Sunday Ticket” subscribers. To calculate the damages amount, the jury multiplied $191.26, which it termed the “overcharge,” by the number of subscribers.
Gutierrez claimed that the jury ignored his directions and “instead relied on inputs not tied to the record to create its own ‘overcharge.'” It is not the first time the NFL has obtained a legal ruling in this lawsuit, which has been ongoing since 2015.
In 2017, U.S. District Judge Beverly Reid O’Connell dismissed the lawsuit and ruled in favor of the NFL, stating that “Sunday Ticket” did not reduce NFL game output and that, while DirecTV may have charged inflated prices, this did not “on its own, constitute harm to competition” because it had to negotiate with the NFL to carry the package.
Two years later, the 9th Circuit Court of Appeals restored the case. The plaintiffs will most certainly file an appeal with the 9th Circuit once again.
