Federal judge overturns $4.7 billion jury verdict in ‘Sunday Ticket’ trial, rules in favor of NFL
LOS ANGELES — A federal judge has overturned a jury’s $4.7 billion verdict in the class action lawsuit filed by “Sunday Ticket” subscribers against the NFL and awarded judgment to the NFL.
U.S. District Judge Philip Gutierrez ruled Thursday that testimony from two subscribers’ witnesses had flawed methodologies and should have been excluded.
“Without the testimony of Dr. (Daniel) Rascher and Dr. (John) Zona, no reasonable jury could have found any class-wide harm or damages,” Gutierrez wrote at the end of his 16-page decision.
On June 27, a jury awarded $4.7 billion in damages to residential and commercial subscribers after ruling that the NFL violated antitrust laws by distributing out-of-market Sunday afternoon games on a premium subscription service.
The lawsuit involved 2.4 million residential and 48,000 business subscribers in the United States who paid for DirecTV’s package of out-of-market games from the 2011 through 2022 seasons.
“We are grateful for today’s decision in the Sunday Ticket class action,” the NFL said in a statement. “We believe the NFL’s media distribution model provides our fans with a range of options to follow the game they love, including local broadcasts of every game on free, over-the-air television. We thank Judge Gutierrez for his time and attention to this case and look forward to an exciting 2024 NFL season.”
Calls and emails to lawyers representing Sunday Ticket subscribers went unanswered.
The jury of five men and three women found the NFL liable for $4,610,331,671.74 in damages to the residential class (home subscribers) and $96,928,272.90 in damages to the commercial class (business subscribers).
Since damages can be tripled under federal antitrust laws, the NFL could have been liable for $14,121,779,833.92.
Gutierrez said in his decision that if he had not ruled in favor of the NFL as a matter of law, he would have set aside the jury’s verdict on damages and conditionally granted a new trial “based on the irrational damages awarded by the jury.”
Rascher’s models were variations of a college football model. Rascher, an economist at the University of San Francisco, testified that they “figured it out in college sports, (so) they’d certainly figure it out in the NFL.”
Gutierrez said Rascher’s testimony “was not the product of a sound economic methodology” and that he needed to explain how out-of-market programming would have been available on cable and satellite without additional subscriptions.
Gutierrez also found flaws in Zona’s “multiple distributor” models, as it predicted that consumers would have paid more if another service in addition to DirecTV had offered “Sunday Ticket” and there was an unfounded assumption that another distributor – cable, satellite or streaming – would have been available.
“Without knowing what ‘direct to consumer’ means, it is impossible to determine whether it would have been economically rational for consumers to purchase ‘Sunday Ticket’ from another distributor at a higher price,” Gutierrez said. “And that definition was necessary to determine whether another viable distributor existed even during the Class Period. Without that information, the Court cannot determine whether the non-exclusive worlds were reliably modeled.”
The amount proposed by the jury was also not consistent with Daniel Rascher’s model ($7.01 billion), nor with the model ($3.48 billion) of Zona, who was an expert witness in the case.
The jury instead used the 2021 list price of $293.96, from which it subtracted $102.74, the average price actually paid by residential Sunday Ticket subscribers. The jury then used $191.26, which it considered the “overcharge,” and multiplied it by the number of subscribers to arrive at the damages amount.
Gutierrez said the jury failed to follow his instructions and “instead relied on evidence unrelated to the case to create its own ‘super-indictment.'”
This is not the first time the NFL has won a legal judgment in the case, 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 because she said “Sunday Ticket” did not reduce the NFL’s production of games and that while DirecTV may have charged inflated prices, it did not constitute “in itself harm to competition” because it had to negotiate with the NFL to distribute the package.
Two years later, the 9th Circuit Court of Appeals reinstated the case.
The plaintiffs are likely to appeal again to the 9th Court of Appeals.
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