NFL Ordered to Pay $4.7 Billion in Sunday Ticket Case
A federal jury in California ruled that the league violated antitrust laws with its out-of-market broadcasts, a verdict that delivers a sweeping blow to the business model of America’s richest sport
A federal jury in California dealt a sweeping blow to the media rights model of America’s richest sport on Thursday, siding with plaintiffs in a class-action antitrust lawsuit against the NFL over its out-of-market broadcasts and awarding $4.7 billion of damages to consumers of the league’s “Sunday Ticket” telecast package.
The league said it was disappointed with the verdict and plans to appeal.
After a trial that included testimony from the likes of commissioner Roger Goodell and Dallas Cowboys owner Jerry Jones, the jury awarded damages of about $4.6 billion to residential subscribers and just under $100 million to commercial users, sums that will be tripled to more than $14 billion under antitrust law if the judgment is upheld.
The number represents nearly two-thirds of what the NFL pulls in annually, with significant implications for antitrust law in sports going forward.
“Justice has been done,” said Bill Carmody, the lead lawyer for the plaintiffs. “The jury spoke loud and clear to protect consumers.”
The NFL said in a statement that the league’s media distribution strategy was “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 verdict is the latest twist in a saga that dates all the way back to 2015, when a San Francisco pub named the Mucky Duck filed a lawsuit that accused the NFL of violating antitrust law and harming consumers through the sale of “Sunday Ticket.” Others quickly followed and the action has been crawling through the legal system for nearly a decade.
For a league that earns more than $20 billion annually, the verdict poses an enormous threat given its potential to upend the NFL’s business model, in which media deals are the lion’s share of its income.
The case essentially pitted the NFL against its own fans. The plaintiffs argued that the way teams pool together and collectively sell their media rights with the Sunday Ticket package is anticompetitive because it forces consumers to pay hundreds of dollars for a product that also includes games they didn’t want, and whose price might be inflated.
On Sunday afternoons, CBS and Fox air games regionally, while out-of-market games are available for purchase as a package through Sunday Ticket. That means that Cowboys games air locally on television in Dallas, but Kansas City Chiefs fans who live in Texas have to subscribe to Sunday Ticket in order to watch Patrick Mahomes every weekend. The product was sold through DirecTV until last season when it became a YouTubeTV offering.
The NFL countered that it is one of the few leagues that airs most of its games—and all local ones—on broadcast television. On the stand last week, Goodell called Sunday Ticket a “supplemental package” for the most ardent fans and acknowledged there has been concern from CBS and Fox about it undercutting the value of their deals.
Jones testified that while the Cowboys would make more money if they could sell their own TV rights, owing to their popularity, such a dynamic would ultimately hurt the league overall.