July 13, 2024

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When jurors tagged the NFL with a $4.7 billion verdict—tripled under antitrust law—for allegedly colluding to keep Sunday Ticket prices high and limit consumer choice, many started doing the math to deduce how much it would cost per team. At treble damages, that’s $440 million per club. But the NFL is confident teams will never have to pay that much, if at all. Many legal experts agree. They contend the jury award rests on a faulty premise, and the league has other solid arguments, some of which are already embraced by a Supreme Court justice.

— Daniel Kaplan [[link removed]]

The NFL Is Confident It Can Overturn the Sunday Ticket Verdict

Commissioner Roger Goodell (Jasen Vinlove-USA TODAY Sports)

Ambush. Fiasco. Pile of dung. Nonsense.

These are some of the words and phrases to describe the $4.7 billion jury verdict against the NFL in the Sunday Ticket case [[link removed]]—parlance used by not just the NFL but also sports law experts interviewed by Front Office Sports. Earlier this month, jurors agreed with the plaintiffs that the league broke antitrust law by colluding to keep the out-of-market package priced artificially high and with a take-every-game-or-none approach.

Several of these legal experts believe the league has a decent chance to get the verdict overturned, a new trial ordered, or damages reduced by the presiding judge—even before the case arrives at the appellate court level. The judge scheduled a July 31 hearing to consider the NFL’s motion for him to change the verdict.

“It does sound like there was a fiasco that went on in this courtroom that the judge allowed. There are all sorts of mistakes and things that happened that don’t seem O.K.,” says Mark Levinstein, a sports antitrust attorney with Washington, D.C.–based firm Williams & Connolly, tells FOS. He cites the significant procedural errors the NFL alleges occurred during the trial as well as the league’s assertion that the jury’s damages award is based on a misunderstanding of the evidence. “The judge isn’t going to want this to go to the court of appeals with a jury verdict that clearly was nonsense.”

Chris Deubert, a sports attorney with Constangy, Brooks, Smith & Prophete, believes “the NFL was right to say the jury’s award has to be reasonably connected to the evidence. And it [isn’t]. They have a pretty strong argument that that’s not the case here. That they, the jury, sort of made something up.” This is among the arguments the NFL made in its post-verdict motion July 3, which asks the judge to overturn the decision or order a new trial.

As judges typically respect jury verdicts, the league’s full slate of contentions about legal errors and jury mistakes must be significant. The process of the losing side asking for the judge to alter the decision is often just a formality to check off before the case can be legally appealed. That may not be what’s happening here.

As part of its everything-but-the-kitchen-sink approach in its first post-verdict motion earlier this month, the NFL argued there were numerous errors in legal procedure, to even the seating of a juror who should have been rejected because he paid for a family member’s Sunday Ticket subscription. The league also argued that the plaintiffs violated legal protocol by waiting until the trial to raise the issue of price-fixing, timing the league says was an “ambush.”

But the argument the NFL has about the damages calculations is what has really caught the attention of legal experts. Many predict the judge, whom during the trial criticized the plaintiffs’ handling of the case [[link removed]], may act after the July 31 hearing before the case gets to an appeals court.

The plaintiffs had asked for $7 billion in damages, but the jurors rejected that calculation and came up with their own. While no juror has said how they got to $4.7 billion—a figure that would be tripled under antitrust law—the NFL makes what Levinstein calls a very “compelling” argument that it was based on a faulty conclusion.

The average list price for Sunday Ticket the jury had to work with was $294, and testimony during the trial pegged the actual average price paid was $102.74 (DirecTV was well known for heavily discounting Sunday Ticket and giving it away for free to lure subscribers). The NFL alleges that the jury took this $192 difference and multiplied it by the number of both residential- and commercial-class subscribers. “The results replicate the jury’s damages awards perfectly for the residential class, and within two cents for the commercial class,” the NFL said in its motion.

The plaintiffs have not yet filed a response to the NFL, and its lead lawyer did not reply to FOS’s request for comment, so it’s unclear of their take on how the jury arrived at the damages. But if the NFL is right, the jury may have confused the $102.74 figure for what consumers should have paid instead of the $294 listed price. The amount also would not apply to restaurants and bars, which pay far more for Sunday Ticket, though the jury seems to have used the same calculation here as well.

Kirby Lee-USA TODAY Sports

“The NFL, I think, quite compellingly explains that doesn’t really make sense, because it’s not an overcharge,” Deubert says of the jury purportedly using the $192 figure—the difference between the listed price and the far lower average real price consumers paid—to calculate damages. “There would have had to have been evidence that shows that the class members should have only been charged, you know, $50 or $65 and were actually paying $294. But that does not seem to be the evidence.”

There in fact was some evidence of this because plaintiffs’ attorneys introduced at trial an NFL email showing ESPN in 2018 wanted to bid on the package and charge only $70 a month. Still, the plaintiffs’ $7 billion damages model was not based on that offer, but on a scenario in which teams distributed their own out-of-market games. According to the NFL’s motion, the plaintiffs’ expert report concluded this paradigm “​​results in Sunday Ticket being free to all class members during the class period.”

The main thrust of the plaintiffs’ argument is first that the antitrust exemption conferred on the NFL’s CBS and Fox deals by the Sports Broadcasting Act of 1961 does not extend to Sunday Ticket. And to please those two networks, which viewed Sunday Ticket as a competitor, the NFL worked to keep the price of the out-of-market package high while limiting the subscriber base, while the 32 teams colluded by agreeing not to sell their own out-of-market TV rights.

So, while the NFL will surely hammer at the calculation behind the jury damages figure, the league has these other broader issues it will raise on appeal when the case gets to the 9th Circuit, and possibly the Supreme Court. When the high court declined to hear the NFL’s petition in 2020 to throw out the litigation, Justice Brett Kavanaugh wrote in a side opinion that “the NFL and its member teams operate as a joint venture. Antitrust law likely does not require that the NFL and its member teams compete against each other with respect to television rights.”

He also wrote that the plaintiffs may not have standing because they bought Sunday Ticket from DirecTV, not the NFL.

The league doesn’t want to win by procedural and jury mistakes, Levinstein says. “They want to win on the Kavanaugh method.”

Could the NFL settle?

Irwin Kishner, a sports attorney with New York–based firm Herrick Feinstein, says he is surprised the NFL did not settle before trial and expects the league ultimately will. He disagrees with Levinstein and Deubert that the judge in the case would alter the verdict, calling such instances rare (though he still describes the damages as “staggering”).

Levinstein, however, says, “I don’t know what the judge thinks. But the judge also has to understand this is going to the court of appeals and might go to the Supreme Court. So he may not want to send them a pile of dung.”

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