In litigation surrounding a class-action lawsuit pertaining to NFL Sunday Ticket, a jury in Los Angeles federal court sided with the plaintiffs in the case and ordered the league to pay approximately $4.7 billion in damages. This lawsuit was filed on behalf of ver 2.4 million residential subscribers and more than 48,000 commercial establishments, stating that the league violated antitrust law through the out-of-market product. Being that this is a case under the jurisprudence of federal antitrust law, the damages would be tripled and equate to more than $14 billion.
The NFL released a statement shortly after the verdict was reached in which it disagreed with the outcome and would appeal the decision. The league also filed a motion earlier in the month where it levied criticism against U.S. District Judge Philip Gutierrez regarding certain aspects of the case. Gutierrez will hold a hearing on July 31 to review the motion that could result in several different outcomes, one of which is classifying the jury verdict as irrational.
Goodell, who testified in the case himself, was asked about the trial during an appearance on CNBC on Thursday morning from the Allen & Company Sun Valley Conference. Julia Boorstin, conducting the interview for Squawk on the Street, wanted to know what he expected would come from the lawsuit and how it would impact the broadcast venture in addition to other deals going forward.
“Well we obviously disagree with the jury verdict, and we are committed, obviously, to following the legal process,” Goodell said. “It’s a long process – we’re aware of that – but we feel very strongly about our position, our policies particularly on media that we make our sport available to the broadest possible audience. Sunday Ticket is just a complimentary product, so we’re committed to following the litigation all the way and making sure that we get this right.”
Skydance Media will merge with Paramount Global in an all-stock transaction that values Skydance at $4.75 billion, it was announced by both companies earlier in the week. The two-step transaction will involve Skydance Investor Group, which consists of the Ellison Family and RedBird Capital Partners, to invest $2.4 billion to acquire National Amusements for cash and then merging Skydance and Paramount Global to form “New Paramount.” The management team of the company will be led by David Ellison, who will serve as the chairman and chief executive officer, and Jeff Shell as its president.
Boorstin explained that there has been discussion whether the National Football League could consider renegotiating its media rights agreement with CBS because of the new parent company. While the NFL is currently in partnership with Skydance Sports, including for the ongoing Hard Knocks documentary series, the league will be sure to look at the deal creating “New Paramount” and determine its impact. The NFL reportedly receives $2.1 billion per year from CBS Sports under its current media rights agreement that runs through 2033. The league reportedly has the right to opt out of its media deals four years ahead of their expiration.
“We know Skydance – we’re partners with Skydance,” Goodell said. “They’ve done a terrific job with our relationship, so we’ll look at the structure of the deal, we’ll see how it impacts us, we’ll see how it impacts our business, and we’ll make the best decision for the NFL at that point.”
CBS Sports was the broadcast home of Super Bowl LVIII this past season, attaining record ratings with an average of 123.7 million viewers watching the contest between the Kansas City Chiefs and San Francisco 49ers. Moreover, Nielsen Media Research and Adobe Analytics data indicates that 202.4 million viewers watched all or at least some part of the game. The league attained strong viewership throughout the preseason, regular season and playoffs, accounting for 93 of the 100 most-watched television broadcasts last year, according to data from Nielsen Media Research.
“We have great relationships with our networks, and a lot of our media is not about the dollars as much as it is, ‘How do we reach more fans?,’” Goodell said. “That’s the primary objective for us. Obviously we want to be paid fairly, but for us, it’s about reaching fans, and being on a free platform like we are allows our fans to see that, and I think that’s what’s led to the great, not only popularity of the league, but obviously the great ratings.”
