Ninth Circuit skeptical of NFL's win in Sunday Ticket trial

(CN) — A Ninth Circuit panel appeared skeptical at a hearing Monday about how the NFL had prevailed at an antitrust trial brought by subscribers to its Sunday Ticket package.

While the three judges didn’t tip their hand how they might rule on the subscribers’ appeal, they expressed several concerns regarding the trial judge’s exclusion of the testimony from two of the plaintiffs’ expert witnesses as well as his decision to scrap the jury’s $4.7 billion damages award.

“As a trial judge, there have been many times that I can point to where the jury came to result that, as long as the instructions were valid and correct, we accept the jury’s verdict,” said Senior U.S. District Judge Joan Lefkow, a Bill Clinton appointee from the Northern District of Illinois who sat on the panel by designation. “This judge, remarkably very soon after the verdict, decides to take it away from the jury.”

After a three-week trial in June 2024, a Los Angeles jury took less than a day to return a verdict in favor of the Sunday Ticket subscribers who claimed the NFL conspired with DirecTV to charge inflated prices for the bundle that provides access to all games played on Sunday mornings and afternoons. The $4.7 billion in damages would have been tripled under U.S. antitrust law had it survived.

However, U.S. District Judge Philip Gutierrez, a George W. Bush appointee who retired from the bench shortly after the trial, agreed with the NFL after the verdict was returned that the jurors had concocted their own damages model, in violation of his instructions, based on “guesswork and speculation.”

Moreover, the judge granted the NFL’s posttrial motion for judgment as a matter of law because, he said, the plaintiffs’ economic experts failed to provide an adequate scenario — or a so-called “but-for world” — how the subscribers would have paid less for Sunday Ticket without the purported anticompetitive conduct by the NFL.

Amanda Bonn, an attorney for the subscribers, argued at Monday’s hearing that Gutierrez had abused his discretion by excluding the trial testimony of Daniel Rascher, a sports economist who used the nationwide availability of college football games for no additional charge on basic cable TV as a “yardstick” to determine the damages sustained by Sunday Ticket subscribers.

“All that is required for a reliable yardstick in the first instance is reasonable economic similarity,” Bonn told the panel. “There can be really no debate that there is reasonable economic similarity between NFL football and top tier college games.”

In response, the NFL’s attorney Paul Clement argued that every time during the trial that Rascher was asked to explain how to get from his but-for world comparisons to an outcome where NFL games would be free with basic cable, his response was “the sophisticated parties will work it out.”

However, U.S. Circuit Judge Holly Thomas and U.S. Circuit Judge Anthony Johnstone, both Joe Biden appointees, didn’t seem persuaded that comparing the way college football games are distributed on television with the NFL was somehow inappropriate.

“If that’s not a yardstick, what is?” Johnstone wondered.

CBS and Fox broadcast the NFL’s Sunday afternoon games through their local affiliates. They typically show the games by local teams in these teams’ markets. Avid fans who want to watch games by teams outside their local market have to get a Sunday Ticket package now offered by YouTube TV for about $480 for returning subscribers.

The subscribers claim the NFL inflates the prices of the package in order to minimize competition with the popular CBS and Fox broadcasts for which the networks pay the league billions of dollars a year. The subscribers argued at trial that, if the out-of-market games were available for free, viewership of the CBS and Fox broadcasts would drop along with their advertising revenue.

As a result, the networks would be unwilling to pay the league the same steep prices for the broadcast rights.

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