Senators Threaten to Strip NFL Legal Perks Over Blackouts

December 5, 2014 Posted by admin

The NFL’s policy of blacking out certain games on television could cost it legal benefits worth billions of dollars.

During a Senate Judiciary Committee hearing Tuesday, Sen. Richard Blumenthal, a Connecticut Democrat, urged the NFL to scrap the policy, which keeps fans from watching their favorite teams. If the league doesn’t take action, he warned, Congress should strip the teams of their special exemptions from antitrust laws that allow them to coordinate and fix prices for multi-billion dollar TV contracts.

“The country affords these teams their special status because of their special role in American culture,” Blumenthal said. “But that doesn’t give them the right to abuse this privilege, and the government certainly shouldn’t endorse abusive behavior.”

The NFL blacks out games on local TV if the home team fails to sell at least 85 percent of the seats in the stadium. The league argues the policy helps ensure full stadiums and boosts local economies.

Sen. John McCain of Arizona, who is not on the Judiciary Committee, testified at the hearing to join Blumenthal in pressuring the NFL to end its blackout policy. Last year, McCain and Blumenthal introduced the FANS Act, which would end the antitrust exemption during TV negotiations for any sports league that enforces a blackout policy.

“The simple fact is that the rules as they are today only serve to benefit sports leagues and their member teams at the expense of the hardworking fans who support them so loyally through their money, time, and passion,” McCain said.

In September, the Federal Communications Commission unanimously repealed its regulations that supported the NFL’s blackout policy. The rules, first adopted in 1975, prohibited cable and satellite TV providers from showing a sports event in an area if the game was blacked out on broadcast television stations.

But the FCC vote didn’t necessarily end all NFL blackouts. The league can still use contractual provisions to force its games off of broadcast TV.

Gerard Waldron, an attorney at the firm Covington Burling who represents the NFL, noted that TV blackouts have become relatively uncommon for the league, with only two happening last season. He argued that the blackout policy helps ensure “full stadiums, excited crowds, and competitive games” and that the boost in attendance “helps to support local jobs, businesses, and taxes.”

But Blumenthal suggested that if the league is worried about filling its stadiums, it should just lower its ticket prices.

“That’s the way the market normally works,” Blumenthal said. “Why be greedy about it? The antitrust exemptions are the keys to the kingdom. They are the gold mine for you.”

Blumenthal acknowledged that his FANS Act won’t get enacted this Congress, but he vowed to renew the fight next year. Sen. Chuck Grassley, an Iowa Republican who is in line to become chairman of the Judiciary Committee, said Congress should “tread carefully” in determining which provisions private groups can include in contracts, but he promised to give the bill consideration.

This article appears in the December 5, 2014 edition of NJ Daily.

Article source: http://www.nationaljournal.com/tech/senators-threaten-to-yank-nfl-legal-perks-over-blackouts-20141204

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