In a decision that should delight sports junkies, a judge in Manhattan has rejected an early bid to squash a proposed antitrust class action over how professional baseball and hockey games are televised.
Southern District Judge Shira Scheindlin (See Profile), in a 53-page ruling released on Dec. 5, refused to dismiss claims that the National Hockey League and Major League Baseball stifle competition by blacking out games in certain geographic regions. The judge did, however, toss some claims against codefendants Comcast Corporation and DirecTV.
The case is being closely watched by disgruntled sports fans and has already attracted an armada of top law firms on both sides.
Televised sports enthusiasts have been complaining for years about MLB and NHL’s arrangements with TV stations. If you root for a regional team and own a TV, you can typically watch the team’s games on a regional sports network (RSN) on basic cable. Things get more complicated if you root for a team in a faraway part of the country. You can watch games on Internet services like MLB.TV and NHL GameCenter, but it’ll cost you. They don’t let you pick and choose which games you can pay to watch. Instead, subscribers pay more than $100 a year and get access to every game across the country every night.
Satellite TV providers like DirecTV similarly refuse to let you pick and choose the games you want to watch. And if the faraway team you root for comes to town, the game may be blacked out online and on DirecTV to divert viewership to RSNs.
On any given night, MLB.TV will black out as much as 40 percent of its coverage to subscribers in Iowa. That’s because all six Midwestern teams say Iowa is within their regional market, and all six teams have deals to show games in Iowa through RSNs.
Some MLB and NHL execs want to reform the blackout system. They say it’s alienating customers, particularly younger ones. Six years ago, MBL commissioner Bud Selig said “we have to do something about it.” But for whatever reason, nothing’s changed.
Yahoo! columnist Jeff Bassan blames “greed and gluttony,” noting that “television-based revenue has become baseball’s lifeblood, bringing in far more than ticket sales, merchandising, concessions, and sponsorships.”
With that backdrop, earlier this year plaintiffs firms filed two separate suits against MLB and NHL on behalf of a putative nationwide class of consumers. Their related complaints also pointed the finger at Comcast, DirecTV, a dozen sports franchises including the Chicago Blackhawks and the New York Yankees, and a handful of RSNs.
The four named plaintiffs included an aggrieved Yankees fan living in Mississippi and a woman in Oakland, Calif., who thinks she’s paying supra-competitive rates to watch Oakland Athletics games through Comcast.
Proskauer Rose represents MLB and some of its member-franchises. Skadden, Arps, Slate, Meagher & Flom represents the NHL and related defendants. Other defense firms include Alston & Bird (for DirecTV); Davis Polk & Wardwell (for Comcast); Quinn Emanuel Urquhart & Sullivan (for the New York Rangers); and Boies, Schiller & Flexner (for the New York Yankees). Six different firms represent the plaintiffs, including Cohen Milstein Sellers & Toll; Pomerantz Grossman Hufford Dahlstrom & Gross; and Langer Grogan & Driver.
The plaintiffs lawyers survived their first key test with the Dec. 5 decision. Scheindlin ruled that the plaintiffs had sufficiently alleged that all the defendants violated §1 of the Sherman Antitrust Act. With regard to claims under §2 of the act, however, the judge dismissed Comcast, DirecTV, and RSNs from the case. She also rejected claims by two of the named plaintiffs on standing grounds.
The cases are Laumann v. National Hockey League, 12 Civ. 1817, and Garber v. Office of the Commission of Baseball, 12 Civ. 3074.
@|Jan Wolfe is a reporter for the AmLaw Daily, a Law Journal affilliate. She can be contacted at firstname.lastname@example.org.