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Sunday Ticket trial, Day Two: Opening statements

As cinematic trials go, the all-time best opening statement was delivered by Vincent LaGuardia Gambini, who responded to the prosecutor’s initial remarks to the jury by declaring, “Everything that guy just said is bullshit. Thank you.”

Based on a review of the transcript from the second day of trial in the Sunday Ticket class action against the NFL, the opening statements delivered by Amanda Bonn for the plaintiffs and Beth Wilkinson for the NFL weren’t nearly as entertaining, or profane. But it’s possible that Bonn’s remarks went a long way toward getting the jurors to do what they’re technically not supposed to do until all the evidence is heard — make up their minds as to who should win.

We previously addressed some of the comments made by Wilkinson, based on the limited reporting from the courtroom. Now that we have the full transcript, the openings can be fully scrutinized and understood. Bonn, I believe, went a long way toward persuading jurors as to the antitrust violation they eventually found.

Bonn went right into the case from the moment she stood up, addressing DirecTV’s decision on April 20, 2012, to reduce the price of Sunday Ticket by 30 percent — and by explaining the league’s reaction to it. She said that Steve Bornstein (who ran NFL Media at the time) told Brian Rolapp (who runs it now) that Bornstein wished he’d known about it, so that he could have briefed Commissioner Roger Goodell and Patriots owner Robert Kraft, the chairman of the NFL’s broadcasting committee.

She argued that they wouldn’t have been happy about the plan, because the NFL wanted Sunday Ticket to be priced at a level that would deter many from purchasing it, steering them toward the games available in their local markets.

“DirecTV should have been free to run the business in order to maximize their profits, and if they believed that meant they should lower the price of Sunday Ticket so more customers could afford it, so that they could grow the base of NFL fans who could actually watch football, why would the NFL have anything to say about that?” Bonn said. “They were getting paid the same amount of money regardless. We will find out the answer together. And it’s simple. Corporate greed. Because you will hear that this wasn’t just an ordinary business relationship between DirecTV and the NFL. Instead, you will hear that all 32 NFL teams, the NFL itself, DirecTV, and two other parties -- broadcast networks Fox and CBS -- were part of an anticompetitive scheme to put profits over people, to line the pockets of the owners of these teams so they could continue making billions and billions of dollars by exploiting the very people who made them who they are, their own fans.”

Bonn was careful to explain that she wasn’t attacking the “things we love about the NFL . . . players, fun, being with our family.”

“This case is about a different side of the NFL,” she said. “It’s about the business side of the NFL. . . . This case is about decisions that were made by senior executives at the NFL’s corporate headquarters who work on behalf of [the] owners to maximize their profits. And we also want to be clear that this case is not an attack on businesses making money. And it’s not an attack on businesses engaging in clever strategies within the bounds of the law, within a free market economy where firms compete against each other. That is the American way, and nothing in this case is an attack about that.

“What this case is about is about a different side of the NFL, a dark side, what happens behind the shield when they believe no one will ever see the decisions they are making, the documents they are writing, the deals they are cutting. That is what this case is about.”

She framed the issue of competition by using the example of two coffee shops in a small town, Mel’s and Joe’s. (I would have gone with Mocha Joe’s and Latte Larry’s, but tomato, tomahto.)

"[A]s long as they’re actually competing with each other, guess what’s going to happen?” she said. “If Mel’s orders terrible beans, burns their coffee, and overcharges, they know that customers can just walk right across the street to Joe’s, and vice versa.”

But there’s another way that Mel and Joe can go.

“What if instead of competing and we each keep making our coffee better and lowering our prices, what if I just go walk across the street and talk to the owner of Mel’s Coffee?” she said. “And what if we reach agreements not to compete with each other? What if we reach agreements on price? That is called price fixing. And you will hear that is the supreme evil that the antitrust laws were meant to prevent.”

Bonn then used snippets of testimony and documents to prove her point that the NFL’s 32 teams, as independent businesses, were coming together to fix the price of Sunday Ticket, in order to protect the local-market ratings of CBS and Fox.

For example, she quoted deposition testimony from Kraft, who said that offering Sunday Ticket at a less-than-premium price “would devalue our over-the-air partners’ packages, and then they wouldn’t be [incentivized] to continue and pay us the way they pay us.”

She quoted from a 1998 presentation to the league’s broadcast committee regarding the DirecTV deal, which included this statement: “‘The agreement gives the league two critical advantages. It enables us to maximize our revenue and income from the subscription business while at the same time protecting the value of our broadcasting agreements through limited distribution to non-broadcast viewers.’”

“They said we’re keeping these games away from you,” Bonn said. “All of these other games being played you can’t watch unless you pay the toll. And they knew what the result was: Most people couldn’t afford it, wouldn’t buy it, would be priced out.”

She presented a document from 2001 or 2002, when DirecTV was considering a merger with Dish Network. “They said, well, what if we keep doing our deal with DirecTV and then they merge with Dish?” Bonn said. “Does that mean that Sunday Ticket would be available to more fans? Does that mean more people might stop watching Fox and CBS and watch Sunday Ticket over here? Would that upset the apple cart? Would that disrupt this whole scheme and make Fox and CBS want to pay us less money? What can we do to stop that from happening? . . . At a minimum, the NFL must ensure that it maintains complete control over the pricing and packaging of Sunday Ticket and any future program offerings.”

In another document Bonn showed to the jury regarding the terms of a potential NFL renewal with DirecTV, someone wrote the word “antitrust” next to language regarding potential restrictions on DirecTV’s ability to conduct Sunday Ticket promotions. (That document was apparently excluded from evidence, but good luck scraping that toothpaste back into the tube.)

In a 2018 email Bonn showed to the jury, one NFL executive cautioned another to “be careful how we talk about pricing” with Sunday Ticket.

Bonn showed the jury that, at one point, Fox specifically asked for Sunday Ticket to be no less than $293.96 per season. That wasn’t part of the official agreement between the NFL and Fox; the plaintiffs contend it was part of a secret side deal.

So how can the plaintiffs prove that the NFL had secret side deals with CBS and/or Fox regarding the pricing of Sunday Ticket? Bonn used an example from the 1991 film Thelma & Louise.

"[T]oward the end of the movie,” Bonn said, “Thelma and Louise are on the run, and the authorities have finally caught up to them at the edge of the Grand Canyon. Now, what happens? Geena Davis turns to Susan Sarandon and says, Let’s just keep going. Let’s not get caught. And Susan Sarandon seems to know what she means. She doesn’t mean let’s reverse our car and keep driving to Mexico and hope that we escape the police. What she means is let’s just drive over the edge of this cliff together instead of getting caught. Geena Davis doesn’t say that. She doesn’t use those exact words, but Susan Sarandon understands. And how do we know that’s the understanding they reach? Because as they drive over the cliff, they’re holding hands together. That is circumstantial evidence that they reached an agreement, an understanding, to go over that cliff even though it’s not written down anywhere, even though it’s not even the words that they used.”

The point is that agreements are made all the time without specific words being uttered. Smart, seasoned business executives know what needs to be done. They know where the legal land mines are, and they know how to avoid them.

That’s why circumstantial evidence becomes important in cases like this. The defendant’s witnesses will testify that there was no side deal. The plaintiffs will then use circumstantial evidence to persuade a jury that there was.

It’s no different than what happens in employment cases. The company’s witnesses claim the decision, for example, to fire an employee was not tainted by illegal factors, like discrimination or retaliation for engaging in protected activities. The circumstantial evidence will potentially suggest otherwise, by showing that other employees did the same thing without being fired or simply by attacking the overall believability of the reason(s) given for firing the employee.

In the NFL’s opening statement, Wilkinson pushed back on the themes of greed, conspiracy, and secret documents.

"[There is nothing secret in this case,” Wilkinson said. “We will show you for years how the NFL did its broadcasts, has been public and well-known. . . .”

The primary argument is that the NFL provides fans with many choices.

"[W]hat the NFL does is focus on the fans,” Wilkinson said. “They give fans all kinds of choices. What this case is really about is choice. It’s about the choices provided to the fans, it’s about the choices that CBS and Fox make, the choices that the NFL makes, and the balance to provide as much to fans as they can, and then additional complimentary supplemental services for those avid fans.”

She focused on the fact that the average actual price paid during the class period for Sunday Ticket was $102.70. She said that it works out to 68 cents per game. (Of course, it’s impossible to watch every game live.)

The overriding question is whether the decisions made by and among the NFL’s teams are reasonable.

“Are these agreements, all of them together -- the judge will tell you, you have to look at them holistically -- are they reasonable?” Wilkinson said. “Is it reasonable to let CBS and Fox broadcast these for free and then for the more avid customers allow them to subscribe and contract with DirecTV? That’s the question in the case.”

And the theme, again, was choice.

“I told you the case is about choice,” Wilkinson said near the end of her opening statement. “People had a choice. They had a choice to pay $102.70 on average. They had a choice to pay nothing, to watch all those free games. They had a choice to have the other options. This was their choice as an avid fan, and we love them for it.”

Still, they didn’t love them enough to allow for affordable choice when it comes to games not televised on “free” TV in each local market. That’s the core issue. Did the choice come at a cost that was rigged to get people to settle for the games on their local Fox and/or CBS affiliates and not to: (1) get a satellite dish; (2) install a satellite dish with an obstructed view to the right spot of the sky (I once had to cut down a tree to make that happen); (3) pay for whatever package was required before buying Sunday Ticket; and (4) pay for Sunday Ticket?

It could have been easier, and cheaper. The jury’s verdict, regardless of what happens with it later, becomes a fairly clear sign that it should have been easier, and cheaper.

And it still could be cheaper. The biggest question going forward is whether the pricing of Sunday Ticket will change in response to the verdict, or whether the NFL will stay the course and hope for an eventual victory, at some level of the federal court system.