June 14, 2012 9:00am PT by Eriq Gardner
NFL Head-Trauma Lawsuit: What It Means for TV's $50 Billion Business
This story first appeared in the June 22 issue of The Hollywood Reporter magazine.
As a business, professional football has never been stronger. After resolving last year's labor impasse, the NFL signed new TV deals that will reap the league about $50 billion by 2022. NBC's Sunday Night Football edged American Idol as the top-rated broadcast of the just-concluded TV season, and advertisers salivate over the DVR-proof nature of America's most popular sport.
But all that could be at risk now that 2,000 former players consolidated about 80 lawsuits into one "mega" action June 7 in Pennsylvania federal court. The violence of the game is well known, but lawyers for such players as Hall of Famers Eric Dickerson and the late Reggie White contend that the NFL's response to an epidemic of brain injuries has been "a campaign of deceit and deception, actively concealing the risks players faced from repetitive impacts." Players are threatening to obtain internal league documents that could show health risks were deliberately hidden or ignored.
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Many legal observers believe the allegations by former players are most analogous to claims brought by smokers against Big Tobacco in the 1990s. Success came in those cases when secret memos showed that tobacco executives purposely downplayed the adverse health effects of cigarettes. "It's reasonable to assume that players knew of some risks of playing, but the question is whether there's any knowledge particular to the NFL that they were withholding," says Marc Edelman, a sports law professor at Fordham University.
But even if the players manage to track down evidence that the NFL's Mild Traumatic Brain Injury Committee, set up in 1994 to study the impact of concussions, knew something it didn't share, that doesn't necessarily mean players will be dancing in the end zone.
"The issue of causation will be huge," says Michael McCann, a sports law professor at Vermont Law School. "These players suffered hits at young ages, in high school and in college, before getting to the NFL. Much of the damage may have occurred then, so the question will be why the NFL should be held accountable."
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Still, the evidence of damage has mounted in recent years. According to studies, more than 60 percent of NFL players experience a concussion during their career. Former players are three times more likely to suffer from depression than the general population, and their rate of Alzheimer's is about 19 times the norm. When former San Diego Chargers linebacker Junior Seau committed suicide in May, he became the third former NFL star to take his own life within 15 months. (Seau shot himself in the chest, which allowed his brain to be donated for study.) The previous two -- Dave Duerson and Ray Easterling -- were thought to have suffered from chronic traumatic encephalopathy, a degenerative brain condition linked to head trauma.
Paul Anderson, an analyst who has been following day-to-day developments at NFLconcussionlitigation.com, says potential damages could top $1.5 billion, the figure requested at one point by retired players for a medical fund. "Then you include past medical expenses, legal fees and punitive damages, and we could be close to $2 billion," he predicts.
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The NFL's broadcasting partners, which took in about $3 billion in football-related ad revenue in 2011, would likely escape liability, say lawyers. (In an ironic twist, CBS' 60 Minutes and the news divisions of the networks helped expose the risks of playing.) And the NFL certainly could afford to pay out a substantial one-time settlement.
But observers say the issue isn't that simple. Some are even putting forward theories about the possible demise of the sport. Tyler Cowen, an influential economist, suggested recently on ESPN's Grantland website that lawsuits could lead insurers to become skittish about the NFL, advertisers to back away from the negative publicity, and high schools and colleges to decide that the rising costs are no longer worth the rewards of football. The NFL, unlike other U.S. professional sports leagues, has no minor-league system, so killing the game at the high school and college levels would put the professional league at risk.
The demise of NFL football would be disastrous to media companies. Consider that DirecTV's NFL Sunday Ticket made about $1.4 billion in subscription and ad revenue in 2011. Trefis, a stock analysis group, estimates that 11 percent of DirecTV's subscriber base subscribes to NFL Sunday Ticket.
But the dire predictions likely are premature. Even if the case is not dismissed by a judge in a decision expected to come during the next nine months, the league has the money to settle the claims. And McCann suggests a way to prevent legal claims by future participants in America's favorite TV pastime: "Make players sign waivers."