The NFL must pay nearly $5 billion in damages for artificially inflating the price of Sunday Ticket, a subscription service offered by DirecTV that showed out-of-market games, a federal jury in Los Angeles ruled Thursday.
The verdict, which capped a months-long class-action lawsuit and nearly a decade of legal wrangling, includes about $96 million in damages for bars and restaurants that signed up for the service and more than $4.6 billion for about 2.4 million households subscribers. Damages in cases like this are tripled by law, meaning the league could have to pay more than $14 billion.
Jury damages were the bulk of what the plaintiffs were seeking. “This is a great day for consumers everywhere,” said Bill Carmody, one of the plaintiffs’ attorneys.
The NFL is expected to appeal the verdict.
“We are disappointed with today’s jury verdict in the NFL Sunday Ticket class action lawsuit,” Brian McCarthy, a spokesman for the league, said in a statement. “We will certainly challenge this decision as we believe the class action claims in this case are meritless and without merit.”
Judge Philip Gutierrez, who openly admonished the plaintiffs’ lawyers during the trial in US District Court, will hear the post-trial motions next month. It could, in theory, decide that the jury reached an improper verdict. An appeals court could also change the amount of damages.
But the verdict carries significant risk for the league, which is a $20 billion juggernaut in large part because of its media deals.
“Juries are inherently unpredictable, but any time there’s a ruling against a sports entity, it’s significant because the leagues rarely take these cases to trial,” said Gabriel Feldman, director of the sports law program at Tulane University.
The political case is at the heart of the league’s media distribution strategy, which for more than half a century has relied on negotiating contracts with the networks on behalf of all teams. More than 90 percent of NFL games are shown on free-to-air television in the markets of participating teams, and many other games are shown in prime time on national networks. The league’s contracts with CBS, Fox, NBC and other broadcasters bring in more than $10 billion annually.
Sunday Ticket was a unique product because it packaged out-of-market games already on CBS and Fox and resold them to fans for about $300 a season. The plaintiffs argued that the price was deliberately inflated to limit the number of subscribers. Attorneys for the plaintiffs pointed to an email to NFL executives from ESPN that said the cable sports network was willing to offer Sunday Ticket for just $70 and sell single-team packages.
The league rejected the offer and stayed with DirecTV until 2022, when it struck a new deal with YouTube TV.
During the trial, the league acknowledged that CBS and Fox would be hurt if the Sunday Ticket attracted too many subscribers. Commissioner Roger Goodell, who testified last week, said the service was billed as a premium product.
The jury — and many fans — argued that the league could and should offer its games at a lower price and with more flexible options, such as team-only packages. Feldman, the Tulane professor, said the NFL will likely restate after an appeal its case that while it negotiated the contracts collectively, it was pro-consumer by offering so many games on the air for free.
The NFL will argue that “we’re not like Coca-Cola and Pepsi — we’re more like Coke and Coke Zero,” Feldman said. “We are part of the same company and part of the same goals.”
