## Facts

- Consumers who purchased out-of-market professional hockey and baseball telecasts sued the leagues, clubs, regional sports networks (RSNs), and distributors, alleging anticompetitive broadcast restraints.
- Individual clubs held rights to televise games within exclusive “home” territories and licensed local rights to RSNs, which distributed those telecasts only within the team’s territory.
- The leagues reserved out-of-market rights and sold them through league-controlled subscription packages that bundled most or all out-of-market games.
- League blackout rules prevented subscribers from watching “in-market” games through the out-of-market packages, directing consumers to local RSNs and distributors for local games.
- Plaintiffs alleged agreements among clubs and affiliated entities to divide territories, restrict output and distribution, and channel out-of-market viewing into bundled packages, raising prices and limiting consumer choice.
- Plaintiffs brought Sherman Act § 1 claims (and related state-law claims addressed in other rulings), contending that absent the restraints, clubs and RSNs would compete to sell team-specific or game-specific telecasts, including via internet streaming.
- At this stage, the court resolved cross-motions for summary judgment on the core antitrust claims; earlier motions to dismiss had allowed the central § 1 theories to proceed.

## Issues

1. Whether the territorial broadcast restrictions, bundling practices, and blackout rules could constitute an unreasonable restraint of trade under Sherman Act § 1 under the rule of reason.
2. Whether defendants were entitled to summary judgment based on asserted procompetitive justifications and challenges to market definition, anticompetitive effects, and antitrust injury.
3. Whether particular RSN and distributor defendants were entitled to summary judgment due to a purportedly vertical role or insufficient evidence tying them to the challenged restraints.

## Decision

- The court applied rule-of-reason analysis to the challenged sports-broadcast restraints rather than per se illegality.
- The court largely denied defendants’ motions for summary judgment on the central § 1 claims, holding that genuine disputes of material fact existed as to unreasonable restraint, anticompetitive effects, justifications, and less restrictive alternatives.
- The court denied plaintiffs’ request for a determination of illegality as a matter of law, concluding that reasonableness required factfinding by a jury.
- The court granted summary judgment in part for certain defendants and/or on limited theories where the evidentiary record did not sufficiently connect them to the alleged unlawful agreements.

## Legal Principles

- Horizontal restraints in professional sports broadcasting are generally evaluated under the rule of reason because league cooperation is necessary to produce games, but that necessity does not immunize all cooperative restrictions.
- Under the rule of reason, plaintiffs may survive summary judgment by producing evidence of (i) a relevant market, (ii) anticompetitive effects, and (iii) antitrust injury; defendants may respond with procompetitive justifications, which plaintiffs may counter with evidence of less restrictive alternatives.
- Territorial exclusivity and blackout rules may present triable antitrust questions when evidence supports a finding that clubs and affiliated entities agreed to foreclose competition for live-game telecasts and to force consumers into bundled out-of-market products.
- Procompetitive justifications (e.g., protecting RSN investments, preserving a viable distribution model, avoiding free riding) do not warrant summary judgment where a reasonable jury could find the restraints not reasonably necessary or could be replaced with substantially less restrictive means.
- Consumer harm alleged as supracompetitive prices and reduced output/choice can constitute antitrust injury sufficient to proceed past summary judgment when supported by record evidence and expert testimony.

## Conclusion

The court held that a jury could reasonably find that league territorial broadcast restraints and blackout rules unreasonably restrained trade under Sherman Act § 1, denying summary judgment on the core claims while granting limited defendant- and theory-specific relief where proof was lacking.


Laumann v. Nat'l Hockey League, 56 F. Supp. 3d 280 (S.D.N.Y. 2014)