The NFL Has Been Ordered To Pay Its Fans $4.7 Billion (Here's What It Means)

Today's newsletter breaks down the NFL's Sunday Ticket lawsuit, including why they lost, who will get paid, how much they will get paid, and what it means for the NFL's future.

In 2015, a small sports bar in San Francisco, California, filed a lawsuit against the National Football League (NFL). The bar, called Mucky Duck, alleged that the NFL broke antitrust laws by selling its package of Sunday games at an inflated price and that competition was restricted by only offering the package on a satellite provider.

This wasn’t necessarily a surprise. Commercial buyers of the NFL’s Sunday Ticket package (think: bars and restaurants) have to pay between $6,000 and $78,000 annually for the service, depending on the size of the venue. And bar owners have long talked about how the package of games makes it difficult for small businesses to turn a profit.

Still, this felt like the longest shot of all long shots. For context, the NFL’s 32 franchises are collectively worth over $165 billion, while Mucky Duck is a small neighborhood sports bar that sells $6 drinks and only offers a bag of $1 chips for food.

The truth is that no one expected this case to go anywhere. The NFL kicked the can down the road, delaying and postponing it several times. The case was dismissed by a California judge in 2017, only to be reinstated by the Ninth Circuit two years later. The judge then ruled that it could proceed as a class action lawsuit. And now, nearly ten years after the lawsuit was initially filed, a verdict was handed down yesterday.

The federal jury of five men and three women found the NFL liable and ordered it to pay $4.7 billion in damages. Most of that money ($4.6 billion) will go to residential Sunday Ticket subscribers (i.e., households), while the remaining $100 million will go to commercial users, like Mucky Duck and other restaurant owners.

That’s obviously a lot of money, and the NFL has already said they will appeal. But the craziest part is that U.S. antitrust laws permit plaintiffs to recover three times the damages, meaning the NFL will actually be required to pay more than $14 billion.

Here’s how the math shakes out: The lawsuit covers roughly 2.4 million residential Sunday Ticket subscribers and 48,000 businesses who paid for the package. Lawyers will take their cut, which typically comes out somewhere between 25% and 35% for class action lawsuits (because they often don’t get paid unless they win the case).