Anne Bucher  |  June 20, 2013

Category: Legal News

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Time Warner CableA class action lawsuit has been filed against Time Warner Cable (TWC) by plaintiffs who allege that the $11 billion that the company spent on Lakers and Dodgers rights will be unlawfully passed on to consumers.

On Tuesday, June 18, Sherry Fischer, Stewart Graham, Todd Crow and Gavin McKiernan filed the class action lawsuit in Los Angeles Superior Court. The Lakers and Dodgers are also listed as defendants.

The class action lawsuit targets two deals made by TWC. In 2011, the cable company agreed to a $3 million, 20-year deal to broadcast Lakers games. In January, TWC agreed to an $8 billion, 25-year deal to televise Dodgers games.

Plaintiffs allege that the costs of these agreements will be passed on to their consumers. According to the class action lawsuit, the programming is bundled into “enhanced” basic cable service. They allege that TWC will recoup its expenses from Southern Californians, many of whom do not wish to pay to watch Lakers or Dodgers games on television. These consumers, “if given the option to do so, would opt out of such telecasts.”

TWC will broadcast the Lakers games on TWC SportsNet and DWC Deportes, stations owned by the Lakers team. The Dodgers games are broadcast on the SportsNet LA network, which is owned by the team. TWC sold the rights to televise these channels to other multichannel video programming distributors, requiring these companies to include the Lakers and Dodgers channels on their enhanced basic cable packages without providing an opportunity for subscribers to opt out. The plaintiffs allege that TWC’s bundling practice is an unfair method of competition. By filing this class action lawsuit, the plaintiffs are seeking an injunction against unlawful and unfair business practices under the California Business and Professions Code.

In their class action lawsuit, the plaintiffs state that these bundling practices are “invidious” because they require subscribers to pay for channels they do not want and they prevent fair competition between the distributors. According to the plaintiffs: “There is no legitimate business, legal, technological, or economic reason why TWC cannot offer these Lakers and Dodgers games on a standalone channel basis so that only those subscribers who want and are willing to pay for them would do so and those who did not want these channels could ‘opt out.’”

This class action lawsuit is another in the line of attacks on the practice of bundling cable channels. In May, Senator John McCain (R-Arizona) introduced a bill in Congress that would encourage cable providers to unbundle channels, giving more options for subscribers to subscribe only to the channels they want. The cable industry fears that unbundling channels would adversely affect a large number of smaller, less recognized channels.

The Time Warner Cable Lakers, Dodgers Deal Class Action Lawsuit case is Sherry Fischer, et al. v. Time Warner Cable Inc., et al., Case No. BC521159, Superior Court of the State of California, County of Los Angeles.

The plaintiffs are represented by Maxwell Blecher and Courtney Palko of Blecher, Collins, Pepperman & Joye.

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