The shoddy, sporadic coverage of the Sunday Ticket trial took a sharp turn toward thorough and comprehensive on June 18.
That’s the day Judge Philip Gutierrez aired out his frustrations about the case as presented by the plaintiffs.
In fact, the only unsolicited communication we’ve received from the NFL regarding the case came that day, when the league office alerted us to one specific tweet from Joe Flint of the Wall Street Journal.
“You really have nothing,” Gutierrez told the plaintiffs’ lawyers in open court, via Flint. “It’s a total disconnect.”
Later that day, Joe Reedy of the Associated Press authored an item highlighting the judge’s concerns.
“The way you have tried this case is far from simple,” Gutierrez said, via Reedy. “This case has turned into 25 hours of depositions and gobbledygook. . . . This case has gone in a direction it shouldn’t have gone.”
While neither account is inaccurate, both are incomplete. Review of the full transcript shows that, after Judge Gutierrez aired his grievances, something important occurred.
Initially, Gutierrez complained about various aspects of the plaintiffs’ case. Most importantly, he expressed regret that he hadn’t barred both of the plaintiffs’ damages experts — Dr. Daniel Rascher and Dr. John Zona — under the so-called Daubert standard, which requires presiding judges to serve as the gatekeepers for expert testimony.
“This case is out of control.,” Gutierrez said. “I — frankly, you know, I’m struggling in my own mind -- I think there’s a viable chance for a Rule 50 [judgment as a matter of law for the NFL] in this case because I think -- I think I probably should -- may have -- should have granted the Daubert motions as to Zona and Rascher. But we’ll face -- we’ll cross that when we come to it, but I think -- I’m struggling with plaintiffs’ case right now.
“And I’m not sure if I’m struggling because, to me, when you’re taking depositions and playing gobbledygook with an economic expert, you really have nothing.
“So I’ll think about it. I’m -- you’re right, I -- I totally agree with you that, again, we wasted time yesterday. . . .
“Because [Rascher] had his -- he gave us his best shot, and I don’t think much of his best shot. And I don’t think much of Zona’s best shot. And I’m just here regretting not granting the Daubert motions maybe. Because what you do is you reconsider the -- the Daubert motions and then, once you grant the Dauberts, there’s nothing left.”
It sounds bad for the plaintiffs. Especially since the judge has the power to take away the entire verdict, if he decides that the testimony of the expert witnesses should have been barred under the Daubert standard.
The reporting from that specific day, however, ignored what happened next. Marc Seltzer, one of the lawyers representing the plaintiffs, seemed to walk Gutierrez back from the brink of throwing the case out of court.
It happened after Gutierrez explained that he has a “real problem with the but-for world” that the plaintiffs’ experts created, an alternative universe in which there had been no antitrust violations.
“This whole thing that pro football, the but-for world is [the] college [football television model], it doesn’t make any sense to me because the but-for world doesn’t -- is not based in reality because it doesn’t -- during the class period, you want to just pretend that live streaming was a real option, and it wasn’t,” Gutierrez said. “I don’t know what this would look like under a college model.”
That’s when Seltzer might have saved the case.
“Obviously,” he said, “no one could ever know what the but-for world would have been. . . . It’s always a hypothetical construct. . . . And the issue in the case is whether or not that restriction on the number of telecasts that can be seen is anticompetitive. It’s a restriction on output. And that restriction, in turn, has led to the higher prices that are charged for Sunday Ticket, which is a deliberate part of the overall broadcasting system as has been described to you by the witnesses.
“So the reason why college football is such a good benchmark, it shows you what happens before and after once the restraints are lifted. After the restraints were lifted [in the 1980s], it took a matter of just a few weeks for college football to reconfigure and to have individual conferences and teams make contracts that they wish to make. And then the number of telecasts multiplied dramatically, the prices went down in terms of the licensing fees that can be charged because it wasn’t centralized, it wasn’t controlled. And that was a vivid demonstration of what happens once the restraints are relaxed.”
That’s when Gutierrez called the case a “total disconnect.” He explained that, as a Notre Dame fan, he wouldn’t pay to watch certain games that weren’t on basic cable.
“Part of their model said, ‘Oh, I’m going to watch West Virginia and Notre Dame play on the ACC channel,’” Gutierrez said. “I ain’t paying for it. So it’s just, to me, like it’s a total disconnect.”
Enter Seltzer, again.
“I understand, Your Honor,” he said. “But here’s the point. When an economist and a smart business firm makes decisions about what to do, they look not at the choices one individual makes. It’s the choices of the millions of people, and that adds up to consumer demand. And what the record shows in this case very, very strongly is that there is a pent-up demand to see these out-of-market games which this system has not satisfied. In fact, what it did, it squeezed the demand, it squelched what the available sources were.
“It was like taking a hose and constricting the hose so you only have a small dribble of the games, and then you can raise the price because, according to the record, there are 35 million avid fans, 75 million -- or 70 million others who would have chosen to get out-of-market games if the —
“That’s why I raised myself as an example,” the judge interjected. “I mean . . . that’s an assumption, isn’t it?”
“No, no, no,” Seltzer insisted. “The study that the NFL made, the internal documents that are part of their record in this case, show that they knew that there were 35 or 70 million, depending how you count them, million avid NFL fans who would have chosen to see these out-of-market games if they had the chance to do so.
“And the point of the . . . but-for world is that, if you didn’t have these restraints, those games wouldn’t have been available on — not for an additional premium that was charged, not for an additional subscription price; it would have been included in the over-the-air television or basic cable as — as part of the ordinary channels you get without paying extra. That’s the point of the comparison, and that’s exactly what happened when the college football restraint was lifted.”
It apparently worked. Here’s what Gutierrez said next: “I’m glad we’re having this candid discussion, it’s helpful. And I just don’t know what those people are going to do. . . . When this case started -- you know, as I worked for a couple of years on this case, I thought it was a simple case. . . . And the way you talk about it now is simple. But the way this case has been tried, it’s far from simple. And I’m just -- to me, it’s a total disconnect because I can -- what I’m talking to -- you know, among colleagues and they say, What’s this case about? And I can talk — much like you just said, I can say the plaintiffs say -- I can -- just like you just did, in five minutes, I understand your case. . . but this trial hasn’t been played out that way.”
“Well,” Seltzer said, “the trial necessarily comes in as a mosaic. You get bits and pieces of the case from different witnesses and the experts, but that’s really what the case is about.”
“I mean, when I talk to a colleague, ‘What’s this case about?’” Gutierrez said. “I’ll say, ‘Well, you know, if you were a Seattle Seahawk fan and you live in Los Angeles and you wanted to watch the Seahawks, you got to buy and pay for all the games and you’re paying too much money. That’s what this case is about.’ And all of a sudden, this case has turned into 25 hours of deposition and gobbledygook with an expert.”
Gutierrez concluded by acknowledging that, ultimately, it’s up to the jury.
“Those folks are the relevant folks if it gets to them,” Gutierrez said. “But I’m just sitting here struggling with the case because it didn’t play out as -- I really thought this was a simple case. . . . Once you control output, it should be an easy case -- I thought this was an easy case. Again, once you control output -- well, I feel bad for the Seattle Seahawk fan in Los Angeles, you know. So -- but -- and that’s what I thought the jurors would connect to right away. And I thought, you know, going into this, you might have had the edge because, again, that’s an easy story to tell: I’m a poor Seattle Seahawks fan in Los Angeles and I’ve got to pay more.”
We apologize for the lengthy article. However, it’s important to understand the judge’s perspective. He didn’t know how the jury would react to the overly complicated trial and “gobbledygook.” We now know what the jury thought.
That surely will be a factor when the judge takes up the NFL’s motion to throw out the $4.7 billion verdict.
And here’s the reality. The contemporaneous reporting from June 18 painted a bleak picture for the plaintiffs, regardless of the verdict. The full transcript makes it much more of a toss-up, perhaps at worst, for the plaintiffs.
The judge saw the basic appeal of the plaintiffs’ case. It’s hard to imagine the verdict being tossed out on that ground. The real question is whether he’ll allow the massive damages verdict to stand.
But here’s the inescapable reality. With 11 years of a nationwide antitrust violation impacting millions of fans who paid too much for Sunday Ticket, shouldn’t the verdict be massive, if there’s a finding of an antitrust violation?
