U.S. District Court Judge David Doty late yesterday overturned a decision that would have allowed the NFL to use $4B in media fees during a potential lockout later this year. He said he planned to hold hearings to set damages. Doty's decision comes as the NFL and NFLPA are engaged in federally overseen mediation, which re-commences near DC this morning. NFL owners also are set to meet today to decide whether to lock the players out with the CBA set to expire at the end of the day Thursday.
In his 28-page decision, Doty paints a picture of television network execs who are unwilling to agree to guarantee payments during a lockout, and an NFL that demanded it. "[Y]ou know you've reached the absolute limits of your power as a major network," Doty wrote one network exec testified, "[when] the commissioner of the National Football League calls you ... and says ... [w]e're done, pay this or move on. ... [The NFL has] market power like no one else, and at a certain point in time, they'll tell you to pack it up or pay the piper."
While Doty consistently wrote the NFL had not maximized revenue when it renegotiated its TV deals, as required by the CBA, he never addressed one of the league's core contentions: that the recession limited how much revenue the league could generate when it renegotiated the deals. He also never addressed the NFL's contention that it had maximized revenues by stripping out digital and in-game rights to create Red Zone, which was packaged with NFL Network, thus creating more revenue.
For more on the NFL's labor situation, including the impact of Doty's ruling and the possibility of decertification, see today's issue of THE DAILY.
