Class action to proceed against DirecTV/NFL
August 16, 2019
A class action lawsuit has been revived by the US Ninth Circuit Appeals Court against the National Football League (NFL), its 32 member teams and DirecTV (now renamed ‘Now TV’) and its ‘Sunday Ticket’ package.
Class actions rarely succeed in any meaningful way, and this particular attempt has already been thrown out once by a lower court, but in granting this appeal the court has certainly given the action significant legs, and potentially a huge decision if it is victorius.
The lawsuit argues that the current live broadcasting – on DirecTV – of the NFL games on a Sunday is a violation of the Sherman Antitrust Act.
As Judge Sandra Ikuta ruled in her judgement: “Every Sunday during the football season, millions of National Football League (NFL) fans tune in to watch their team play. If they live in the same area as their favuorite team – such as Los Angeles Rams fans who live in Los Angeles – they can tune into their local Fox or CBS station to enjoy their team’s game on free, over-the-air television. But if NFL fans happen to live far away from their favourite team – such as Seattle Seahawks fans residing in Los Angeles – they can watch every Seahawks game only if they purchase DirecTV’s NFL Sunday Ticket, a bundled package of a 11 NFL games available exclusively to subscribers of DirecTV’s satellite television service.”
“[…] Fans who do not subscribe to Sunday Ticket have access to, at most, two to three local games each Sunday afternoon, in any given geographic area. This means, for example, that Los Angeles fans would be able to use over-the-air cable to watch the Rams play the Chargers at 1:00PM E.T. on Fox, the Vikings play the Patriots at 1:00PM E.T. on CBS, and the Dolphins play the Cowboys at 4:00PM E.T. on CBS. But there is no option for NFL fans to watch any of the other 7 to 10 games played each Sunday afternoon which are not available on free, over-the-air television,” Ikuta continued.
The judge said it was impossible to buy viewing access to a single game. Viewers had to subscribe for a complete season ($251.94 back in 2015 when this action started, but now $293.94), and if it is a commercial premises, such as a sports bar, its fees for a season could be anything between $2314 to $120,000 dependent on the number of seats in its establishment.
Two judges out the three-person panel agreed with Judge Ikuta, and one judge “partially dissented”.
The judgement continued: “[The] Plaintiffs have adequately alleged injury to competition, and have adequately alleged that defendants have market power in the market for professional football telecasts. Moreover, the complaint adequately alleges that the interlocking NFL-Team and NFL-DirecTV agreements were designed to maintain market power, which is sufficient to allege defendants’ specific intent. Accordingly, we conclude that the complaint adequately alleges a Section 2 violation.”
DirecTV pays $1.5 billion annually for TV rights to the NFL games.
This action will likely run and run.