Kensington Antitrust Advisors Group

The Ninth Circuit Court of Appeal has affirmed the dismissal of antitrust claims against television programmers and pay–TV providers who market bundled cable and satellite TV programming.  The proposed class action accused the defendants, who include NBC, Comcast, DirecTV and others, of harming consumers by bundling popular programs with less desirable content, forcing consumers to pay more for the programs that they want.  The three-judge panel, in an opinion authored by Judge Sandra S. Ikuta, found that although the plaintiffs alleged that the programmers imposed a vertical restraint on the distributors that resulted in higher prices and reduced consumer choice, the claims failed to allege a specific injury to competition as required, such that the case was “a consumer protection class action masquerading as an antitrust suit.”  Antitrust law, said the court, did not apply because it “recognizes the ability of businesses to choose the manner in which they do business absent an injury to competition.”  The plaintiffs had previously alleged that the practice foreclosed entry into the programming market, but had dropped that claim after initial discovery.