NFL Heads to the Supreme Court in TV Rights Case

Packinatl

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This is worth watching …..

US Supreme Court is being asked to take a hard look at the agreement by the NFL’s 32 teams to pool TV rights as well the nature of its intellectual property.

In August, the 9th Circuit Court of Appeals hinted at potential upheaval. In reviving a class-action lawsuit concerning DirecTV’s Sunday Ticket — the federal appeals court ruled it was plausible that the “horizontal” agreement among the NFL’s 32 teams to pool TV rights along with the league’s “vertical” agreement with a satellite distributor amounted to an illegal restraint of competition under the Sherman Antitrust Act

Congress passed the Sports Broadcast Act of 1961, which basically gave an exemption to antitrust laws by allowing members of a professional sports league to sell rights in a cooperative fashion. Nowadays, NFL teams are beholden to Article X of league bylaws, which gives ultimate authority over the league's TV contracts to Commissioner Roger Goodell and restricts teams from telecasting a game into the home market of another club



And there is precedent In 1984, in NCAA v. Board of Regents, the Supreme Court held that the NCAA's TV rights system violated antitrust law, which is one of the big reasons why conferences such as the SEC, the Big Ten and the Pac-12 are now each able to make their own licensing deals
 

HowardK4

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So, who asked the Supreme Court to take a look at the agreement? The federal appeals court? Who actually started the investigation - i.e. who first filed the class action lawsuit against DirecTV? I'm guessing it's other "providers" who want a cut of the huge pie.
I'm not saying their wrong - when we moved away from WI the NFL Direct Ticket was the only way to ensure that we could see every Packers game, and it's still the only option. But it seems that the NFL was well within their rights doing it, based on the Sports Broadcast Act of 1961 which applies to professional sports leagues (not the NCAA which is still qualified as an amateur league).
My fear with all of this is that this will have an even more exponential increase on the cost of attending and watching NFL games.
 

Packinatl

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So, who asked the Supreme Court to take a look at the agreement? The federal appeals court? Who actually started the investigation - i.e. who first filed the class action lawsuit against DirecTV? I'm guessing it's other "providers" who want a cut of the huge pie.
I'm not saying their wrong - when we moved away from WI the NFL Direct Ticket was the only way to ensure that we could see every Packers game, and it's still the only option. But it seems that the NFL was well within their rights doing it, based on the Sports Broadcast Act of 1961 which applies to professional sports leagues (not the NCAA which is still qualified as an amateur league).
My fear with all of this is that this will have an even more exponential increase on the cost of attending and watching NFL games.
to answer your question Howard

The Ninth Circuit relied in part on this 1984 decision along with another high court opinion (2010’s American Needle case) in reviving the Sunday Ticket class action. In doing so, the court rejected the NFL’s contention that telecasts could only be created through cooperation between competitors. As the opinion put it, “Just as the University of Oklahoma was forbidden from increasing the number of telecasts made of its games, so too are the Seattle Seahawks forbidden from selling their telecast rights independently from the NFL.”

NFL: “Unlike the NCAA, the NFL is a highly integrated joint venture that produces an entertainment product — the on-the-field competition of NFL Football — which the NFL then distributes to consumers through broadcast television and other means.”

In other words, the high court is being asked to take a hard look at the agreement by the NFL’s 32 teams to pool TV rights as well the nature of its intellectual property. The league states that the arrangement is “integral to the creation of the [NFL’s] product,” setting up the argument that the 9th Circuit has misconstrued legal precedent and that game telecasts are nothing like the kind of licensed apparel that the Supreme Court focused on in American Needle.
 

HowardK4

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but who asked the courts to start looking at this? They just didn't decide on their own, someone must have complained or filed the original lawsuit. I'm just curious.
 

Packinatl

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but who asked the courts to start looking at this? They just didn't decide on their own, someone must have complained or filed the original lawsuit. I'm just curious.
I believe it originally was a Class Action suit from Direc TV subscribers

 

HowardK4

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Thanks Pack. I'm still unsure as to why DirecTV subscribers would file an antitrust lawsuit - having 32 separate team broadcast groups would certainly not reduce the cost. What makes more sense to me is that the plaintiff "Ninth Inning Inc." is a group that wants the chance to broadcast NFL games, claiming that DirecTV has an unfair monopoly (hence the original reference to the Sherman Antitrust Act).
 

Packinatl

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Thanks Pack. I'm still unsure as to why DirecTV subscribers would file an antitrust lawsuit - having 32 separate team broadcast groups would certainly not reduce the cost. What makes more sense to me is that the plaintiff "Ninth Inning Inc." is a group that wants the chance to broadcast NFL games, claiming that DirecTV has an unfair monopoly (hence the original reference to the Sherman Antitrust Act).
Howard I think the real play here, or should I say the end game is streaming. No chance this group could get funding to beat any network, cable or broadcast for a national package or even local TV packages. Not just cost but issues with retransmission fees even local. They could make the case that satellite services are not "over the air" and not subject to FCC rules. Streaming / online is like the Wild West now
 

HowardK4

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Pack I would agree that it's most likely the streaming services that are trying to break up the monopoly - again, they want their slice of the big pie. And as I said I'm not against the breakup - if they can provide the same content, with all the necessary bandwidth, at a lower price than the NFL Direct Ticket (btw the price of the NFL package is now unreasonably high). Disney+ is already having problems with bandwidth, and if you think about the Millions that would be streaming games, all at the same time . . . .
 

Packinatl

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Pack I would agree that it's most likely the streaming services that are trying to break up the monopoly - again, they want their slice of the big pie. And as I said I'm not against the breakup - if they can provide the same content, with all the necessary bandwidth, at a lower price than the NFL Direct Ticket (btw the price of the NFL package is now unreasonably high). Disney+ is already having problems with bandwidth, and if you think about the Millions that would be streaming games, all at the same time . . . .
agree with you 100%. its a combo of bandwidth and also how you monetize ad revenue. it sounds simple but its damn complicated
 
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