Judge appears unlikely to uphold $4.7B NFL verdict

A $4.7 billion jury verdict against the National Football League for antitrust violations related to its Sunday Ticket package is in jeopardy as the presiding Los Angeles federal judge told the parties Wednesday that jurors failed to follow his instructions and irrationally concocted a damages model that was inconsistent with the case's evidence.

U.S. District Judge Philip S. Gutierrez did not issue a ruling during the nearly three-hour judgement hearing and took the matter under submission. However, he did not seem persuaded by the plaintiffs' lead attorney, Susman Godfrey LLP partner Marc M. Seltzer, who argued for almost two hours that the jurors' calculations were fair, and it was not the court's place to speculate on their mental processes.

The June 27 verdict came just a day after the close of a month-long trial. An eight-person jury found the league violated sections 1 and 2 of the Sherman Act with its licensing of out-of-market Sunday afternoon football games on DirecTV from 2011 to 2023. The league was found to have conspired with DirecTV by selling the package at an artificially high price to stifle competition with local television networks such as FOX and CBS. Due to the treble damages remedy in the federal antitrust statute, the league could face a penalty of up to $14 billion if the verdict is upheld.

However, the lawsuit - based on analyses from two of the plaintiffs' sports economy experts - called for damages of $7 billion from calculations of a but-for world where the NFL provided Sunday Ticket to fans absent of DirecTV during the class period. In re: National Football League's Sunday Ticket Antitrust Litigation, 2:15-ml-02668 (C.D. Cal., filed Dec. 10, 2015).

Dr. Daniel Rascher concluded damages would be worth $7.01 billion if the NFL had mirrored the NCAA's Saturday College Football model, where each broadcast package is sold separately by conference or team. Alternatively, Dr. J. Douglas Zona concluded damages would be around $3.48 billion under a model where Sunday Ticket was offered directly to the consumer via online streaming.

Wilkinson Stekloff LLP partner Brian L. Stekloff for the NFL argued the jurors' "nonsensical" calculations were indefensible and showed the plaintiffs failed to prove how the league enacted classwide antitrust harm because their verdict was not consistent with either model.

"The jury clearly found that they did not believe in the college football model. ... I think the verdict demonstrates both [Rascher's and Zona's] unreliability and a failure of the plaintiffs to prove classwide anticompetitive effects, injury and damages, as they were required to do based on the models," Stekloff said.

Gutierrez seemed to agree. In explaining his instruction to the jury, the judge said he told them the averaged or estimated overcharges the class members paid, "must be based on evidence and reasonable inferences and not guesswork or speculation. That's not what they did."

Rather than using the economists' models, jurors used the 2021 list price of Sunday Ticket, $293.96, and subtracted the average annual price paid by residential subscribers, $102.74, the NFL theorized. They then used the difference as the overcharge and multiplied that number by the number of subscribers during the class period to come up with the damages amount.

"We're not speculating what the jurors did. ... There's no doubt about what they did exactly," Gutierrez said. "To the pennies, that's what they did."

While acknowledging the jurors took a precise percentage that wasn't part of the presented models, Seltzer said they had the discretion to do so.

"The jury has the ability to make an agreement among themselves when they're trying to come to a verdict to effectively negotiate what they think a fair result is," Seltzer said. "The mission was whether it fell within the range supported by the evidence, and here, it falls within that range. They may not have to accept Dr. Rascher's testimony 100-percent to award damages in this case, they can award less damages ... and they can do it by means that tests outsiders as transparent, in terms of the map they use. That's not a basis to set aside a verdict."

Gutierrez did not seem moved and reiterated his point that because the math was precisely calculated, there was little doubt as to how the jury reached its verdict.

However, Seltzer said there was no way to know for sure unless all eight jurors were brought back for cross examination.

"To argue that they made that finding impliedly is actually delving into the mental processes of the jury to figure out why they did what they did, which is not permissible," Seltzer said.