NFL criticizes jury’s basis for $4.7 billion verdict

The NFL has been trying (with some success at times) to convince the courts that the Sunday Ticket class action lawsuit should be dismissed. The league’s most recent filings focus on the way a Los Angeles federal court jury reached its $4.7 billion verdict.

In the NFL’s renewed motion for judgment as a question of law, which PFT has obtained and reviewed, the league focuses heavily on the jury’s failure to adopt the financial methodology suggested by the plaintiffs’ experts and, in turn, the jury’s decision to make its own calculation of the damages incurred by the two groups in the litigation – more than 500,000 commercial establishments and more than 2.4 million residential customers.

In any civil case, the plaintiff must first prove the defendant’s liability. Then the plaintiff must show the extent to which the defendant’s conduct caused economic harm. Thirty-eight years ago this month, a jury found that the NFL had violated antitrust laws, but the USFL had failed to prove any harm. The verdict at the time was one dollar.

Coincidentally (or not), on page II of its most recent brief in the Sunday Ticket case, the NFL specifically requests that the court “reduce the irrational and unjustified damages award to a symbolic amount of $1.”

In that case, plaintiffs presented two possible models for determining the financial losses resulting from the NFL overcharging DirecTV for Sunday Ticket. The NFL argues that the jury ignored those formulas and instead developed their own.

The NFL claims the jury took the list price for the basic Sunday Ticket package in 2018 and 2019 ($294) and subtracted $102.74, which the NFL says was the average price that retail customers actually paid during the class period. The jury then multiplied the $191.26 difference by the number of commercial and retail subscribers in the class, according to the NFL’s argument.

For the residential class, the calculation works out to the exact cent ($191.26 x 24,105,049 equals $4,610,331,671.74) and is only two cents less than the amount awarded to the commercial class ($191.26 x 506,788 equals $96,928,272.88).

“The jury instead did exactly what the court had raised concerns about during deliberations – they ‘worked with (their) telephone calculators and created (a) model,'” the NFL explains. “Although the jury did not detail the basis for its calculations, its very specific damage figures leave no doubt as to what it did.”

So, in essence, the jury ignored the evidence presented by the plaintiffs and invented its own damages. The NFL argues that this requires the court to reject the verdict.

Although plaintiffs will have an opportunity to respond to the NFL’s latest lawsuit, it appears to be (at least for now) the strongest argument the league can make.

Of course, that doesn’t stop lawyers (especially those paid by the hour) from trying to cram as many arguments into the case as possible. The NFL packed a lot of arguments into its 25-page brief.

First, the NFL argues that the plaintiffs constructed a last-minute theory based on price fixing, whereas the case previously involved the concepts of pooling and exclusivity.

Second, the NFL claims that various key documents were introduced through improper application of Rule 806 of the Federal Rules of Evidence. (At the risk of becoming a legal geek, Rule 806 allows hearsay to be used as evidence to challenge the credibility of admitted hearsay evidence and/or evidence excluded from the definition of hearsay.)

“In total, 22 documents were admitted under Rule 806 and formed the core of Plaintiffs’ alleged evidence of ‘price fixing,'” the NFL explains on page 15 of its complaint. “Plaintiffs also relied heavily on these documents, not for their indictment, but for their substance. In fact, the Court twice allowed objections to Plaintiffs’ substantive use of these documents in the closing arguments…”

Third, the NFL claims that the so-called “rule of reason” of antitrust law was misapplied. It gets complicated and opaque, but the argument boils down to the fact that the court failed to include a key word – “substantially” – in one of its instructions to the jury. The NFL believes that the jury should have been instructed to find that the harm to competition “substantially” outweighed the competitive benefits, and that the plaintiffs exploited that error by arguing during closing arguments that they only needed to show a “50.00000001 percent” outweighing of the competitive benefits to prevail.

Fourth, the NFL requests a retrial on several technical grounds: (1) the court allegedly failed to instruct the jury regarding plaintiffs’ burden of proving harm to the entire class; (2) counter-testimony from a plaintiffs’ witness was inadmissible; (3) the court permitted plaintiffs to introduce evidence of prior litigation against the NFL; (4) the verdict contradicts the clear evidence—with eight different arguments made in support of this one point; and (5) the jury foreman is improperly biased because that juror paid for a household member’s 2023 Sunday Ticket subscription outside of the class’s eligibility period.

On the one hand, the paucity of arguments beyond the attack on the damages calculation weakens the impact of the brief. On the other hand, the NFL’s lawyers (and their liability insurers) would like to leave no stone unturned when it comes to preserving arguments for the appeal.

This ruling, with more than $14 billion at stake, will also be heard in the nation’s highest court. The court of first instance will now hear the largest civil judgment ever imposed by an American sports league.

Next, the plaintiffs will file their written briefs, which will surely contradict the NFL’s briefs on all counts. After that, the league will file a response.

Finally, in three weeks’ time, the court will hear an oral hearing on whether the sentence should be overturned or drastically reduced.