Wednesday July 15th, 2015

The NFL and DirecTV are facing a class-action antitrust lawsuit over their NFL Sunday Ticket package.

On Monday, a complaint was filed in federal court in California by prominent antitrust attorney Michael Hausfeld and Hausfeld LLP seeking to represent a class of “commercial subscribers” to DirecTV’s Sunday Ticket, according to The Hollywood Reporter. The plaintiffs in the case would be bars and restaurants nationwide, led by San Francisco pub The Mucky Duck, which believes its fees for Sunday Ticket, allowing the bar to show out-of-market football games, are uncompetitive and exorbitantly priced.

According to the lawsuit, bars with occupancy of up to 100 patrons will pay $2,314 for the package in 2015. Larger establishments, such as Las Vegas hotels, will be charged upward of $120,000. To show the games, bars are forced to use DirecTV, the sole provider of Sunday Ticket.

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The NFL’s deal with DirecTV is an exclusive one worth $12 billion, according to Deadline.com. The lawsuit explains why the deal should be recognized as a violation of the Sherman Antitrust Act. The complaint notes the NFL is the only one of the four major American professional sports leagues with an exclusive out-of-market broadcasting agreement. Because other leagues’ packages—such as NBA League Pass and MLB Extra Innings—can be viewed across multiple network distributors such as Dish, Comcast and Time Warner, prices are competitive and remain lower.

“DirecTV’s arrangement with the NFL allows the Defendants to restrict the output of, and raise the prices for, the live broadcast of NFL Sunday afternoon out of market games,” says the complaint. “Every NFL member team owns the initial rights to the broadcast of that team’s games. However, the teams have chosen to collude with each other, and to grant the NFL the exclusive right to market those games outside each team’s home market. But for the NFL teams’ agreement in which DirecTV has joined, teams would compete against each other in the market for NFL football programming, which would likely induce more competitive pricing.”

Plaintiffs seek the recovery of damages for the premium pricing DirecTV has charged, as well as an injunction on its deal with the NFL that was renewed last year.

Jeremy Woo

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