DirecTV and NFL hit with another class-action suit over 'Sunday Ticket'

DirecTV (NASDAQ: DTV) and the NFL have been hit with the second class-action antitrust lawsuit in less than a month over their NFL Sunday Ticket games package.

This latest complaint, also filed in a California federal court, alleges that the NFL and its pay-TV partner are colluding to over-charge bar and restaurant owners for the right to show out-of-market football games to customers.

Eleven months ago, DirecTV signed an exclusive, multi-year $12 billion deal with the NFL to re-up the Sunday Ticket package. The deal, which runs through 2022, increases DirecTV's licensing fees from $1 billion a season to $1.4 billion. Depending on their size, businesses pay between $2,314 and $120,000 a season to purchase Sunday Ticket access, the suit says.

The Sunday Ticket package allows subscribers to watch every game that's being played out of their local market on each Sunday of the NFL regular season. 

The complaint contends that Sunday Ticket should not be offered to DirecTV exclusively and should be opened to other pay-TV operators to increase competition and lower the price. The plaintiffs say the package currently violates two sections of the Sherman Antitrust Act. 

Antitrust lawyer Michael Hausfeld and his Hausfeld LLP firm filed the suit Monday in California's Central District Court. Previously, Hausfeld successfully sued the NCAA to get college athletes paid when their likeness is used in video games. The lead plaintiff is San Francisco pub the Mucky Duck.

"DirecTV's arrangement with the NFL allows the defendants to restrict the output of, and raise the prices for, the live broadcast of NFL Sunday afternoon out of market games," says the complaint. "Every NFL member team owns the initial rights to the broadcast of that team's games. However, the teams have chosen to collude with each other, and to grant the NFL the exclusive right to market those games outside each team's home market. But for the NFL teams' agreement in which DirecTV has joined, teams would compete against each other in the market for NFL football programming, which would likely induce more competitive pricing."

Separately, DirecTV and the NFL were sued in June, in a class action that claims the league and the satellite provider violate antitrust law by making consumers subscribe to the entire Sunday Ticket package to see just one game. 

Meanwhile, as it tries to close a $49 billion merger deal with AT&T (NYSE: T), DirecTV also moved this week to have a six-months-old racial-discrimination complaint thrown out. In December, the National Association of African-American Owned Media and entertainer Byron Allen sued DirecTV and AT&T for $10 billion, alleging they are biased against blacked-owned media companies. 

For more:
- read this lawsuit (PDF)
- read this Deadline Hollywood story
- read this Variety story
- read this New York Post story
- read this Deadline Hollywood story

Related links:
DirecTV ups NFL Sunday Ticket base price 5%
DirecTV, NFL face class-action suit over Sunday Ticket bundling
NFL plans to stream Jaguars-Bills game over the top this fall
DirecTV to pay around $1.4B to renew NFL Sunday Ticket, report says
DirecTV, NFL face class-action suit over Sunday Ticket bundling

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