Transcript
MICHEL MARTIN, HOST:
The NFL just got sacked for a very big loss. A federal jury in California has ordered the league to pay $4.7 billion in damages in a class action lawsuit, and if the verdict is upheld, that penalty could triple. The lawsuit alleges that the league violated antitrust law by selling its exclusive Sunday Ticket package for out-of-market games. Wall Street Journal reporter Andrew Beaton covers the NFL and has been following this story, and he's with us now to tell us more about it. Good morning.
ANDREW BEATON: Thanks so much for having me.
MARTIN: So help me with this argument. The argument is that the Sunday Ticket package is anticompetitive. Tell us more about it.
BEATON: Yeah, so sports leagues can tend to be a very strange animal. And the contention here is that the 32 teams that compete with each other on the field every Sunday to win NFL games were anticompetitive by packaging their rights in one package together instead of selling all of their television rights individually - that they pooled them together and sold these out-of-market games and that violated antitrust law.
And while we're used to watching, you know, games on Fox and CBS every Sunday afternoon, the Sunday Ticket package is the one that if you are a Dallas Cowboys fan, every Dallas Cowboys game is available for you on free TV in Dallas on Fox or on CBS on Sundays. But if you are a Kansas City Chiefs fan living in Dallas, you won't necessarily have every Chiefs game on TV in Dallas. So you'd have to subscribe to the Sunday Ticket package, which previously had been held through DirectTV, is now held through YouTube TV. And you'd have to fork over hundreds of dollars every season to pay for that package. And the contention was that all the teams pooling their rights through this package was anticompetitive, and a jury found that argument seemingly compelling.
MARTIN: So who are the plaintiffs here, who are the complainants? I guess the question is, if the verdict is upheld, who gets the money?
BEATON: So the people who'd get the money would be people who for a long time subscribed to this package. One small part of it was there were bars and restaurants who pay an additional fee to air it to multiple viewers. One of the original plaintiffs in this was a San Francisco bar called the Mucky Duck. But then the general people who would benefit from this payout are the people who had to pay what could be considered an exorbitant price for this package over the years. And that would be just everyday people who would want to pay for this package living at their homes.
MARTIN: Is this a lot of money to the NFL? I mean, look, it's a lot of money to me and presumably to you. But to the NFL - I mean, you know, football is the most watched sport in the United States. So will the league feel the hit?
BEATON: So the league would absolutely feel the hit if it has to pay this. And we're still a long way from there. The NFL could appeal. A judge could have a different feeling than how the jury calculated the damages. But even for the richest sports league in America, this would be an enormous hit. When we're talking about $4.7 billion in damages and those damages potentially getting tripled, we're talking over $14 billion. That is two-thirds of what the NFL makes in a given year. And even to billionaires, $14 billion is a lot of money. Even if that's split between 32 teams, that's still hundreds of millions of dollars per team. And this would be a massive, massive blow to not just their wallets but to the media model that makes America the richest league around.
MARTIN: All right. That is Andrew Beaton with The Wall Street Journal. Andrew, thanks so much for explaining all this to us.
BEATON: Absolutely.
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