Yesterday, the United States Supreme Court sat with a full bench for the first time since the passing of the long-tenured Justice Ruth Bader Ginsburg. Among other actions on Monday, the Court (Justice Amy Coney Barrett not participating) released an order in the antitrust lawsuit challenging NFL teams’ collective arrangement with DirecTV in which the former permit the latter to be the sole provider of live, out-of-market game telecasts through the NFL Sunday Ticket package.
On its face, the order is good news for those challenging that arrangement, because it allows their lawsuit to continue, letting stand a lower-court order that reversed an even-lower-court order that would have dismissed the challengers’ case.
But while the media coverage of yesterday’s order also noted the portion of the statement included with the order from Justice Brett Kavanaugh that the Supreme Court’s decision “should not necessarily be viewed as agreement with” the lower court’s decision to revive the case, I have not seen any further discussion of the entirety of Justice Kavanaugh’s statement, which goes much farther than what that out-of-context quotation might suggest.
More than a neutral, “we’re not saying one way or the other” comment, Justice Kavanaugh’s statement pours cold water on the hopes of those who saw this lawsuit as a vehicle to break up the NFL’s antiquated, frustrating, and expensive approach to delivering television access to its product. Most fundamentally, the statement suggests the possibility that the challengers may not have a right to bring their lawsuit at all: “This Court’s case law authorizes suits by direct purchasers but bars suits by indirect purchasers. The plaintiffs here did not purchase a product from the NFL or any team, and may therefore be barred from bringing suit against the NFL and its teams.” (Citations and internal quotation marks omitted.) And even if the challengers do have a right to sue, their claims may fail in substance if the NFL and its member teams are organized and operate as a cohesive legal unit:
Under the existing contract, the 32 NFL teams have authorized the NFL to sell the television rights for out-of-market games to a single buyer, DirecTV. The plaintiffs argue, and the Court of Appeals agreed, that antitrust law may require each team to negotiate an individualized contract for televising only its own games. But that conclusion appears to be in substantial tension with antitrust principles and precedents. The NFL and its member teams operate as a joint venture. And antitrust law likely does not require that the NFL and its member teams compete against each other with respect to television rights.
To be sure, these are the preliminary views of one justice on a nine-member court that might never see this case again. If the case does return to the Supreme Court, Justice Kavanaugh’s expressed concerns might not be relevant to the questions at issue for the Court at that time, or, if they are, they might not be shared by a sufficient number of his fellow justices to be consequential.
As the case heads back to the trial court, however, Justice Kavanaugh’s comments could prove influential and find their way into the analysis of a judge who already has shown some disinclination toward the challengers’ claims and, more certainly, the arguments of the league and teams.
DirecTV’s NFL Sunday Ticket package may survive this legal challenge, but the service separately is facing financial difficulties that could render the lawsuit practically moot. Five years after buying it for $49 billion, AT&T has been trying, unsuccessfully, to sell DirecTV as it hemorrhages subscribers, the rate of losses recently slowing only because it’s running out of subscribers to lose. With the NFL’s agreement with DirecTV set to expire in the next year or two, attrition rather than litigation might be the most fruitful course for those seeking more football-viewing options on Sunday afternoons. Stay tuned.