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If given the choice between seeing live professional sports or having a lighter cable bill, surveys show that most consumers would prefer the latter. But it will probably take an act of Congress to do anything for these budget-minded TV viewers.
On Tuesday, L.A. Superior Court Judge Amy Hogue shot down a lawsuit filed last June against Time Warner Cable and two Los Angeles sports teams.
In the class action, the plaintiffs objected to being forced to pay about $4-$5 in additional cable fees per month. The lawsuit came after TWC spent $3 billion for Los Angeles Lakers telecast rights and $8 billion for Los Angeles Dodgers telecast rights. Afterward, the cost was allegedly passed along to cable subscribers.
“A very large segment of the consuming public is not sufficiently interested in Dodgers games to pay $50-$60 per year, but they have no way of unsubscribing from either the Lakers or Dodgers telecast, which together will add (or will if unrestrained) about $100 per year to the subscriber’s TWC bill,” stated the complaint.
The billions of dollars thrown toward the Lakers and Dodgers impacts cable and satellite subscribers across the country.
TWC sublicenses Lakers TV rights to other television distributors, including Cox, DirecTV, AT&T U-Verse and Verizon FiOS. In doing so, TWC requires that distributors offer the Lakers channels on their enhanced basic cable tiers.
In reaction to the class-action lawsuit, TWC pointed to the Cable Communications Act of 1984, which expressly authorizes cable companies to offer programming in bundled “tiers of service.”
That’s enough to get Judge Hogue to acknowledge that federal law forbids the application of a state law like California’s Unfair Competition Law that would undermine a cable operator’s authority to add or delete channels in its “enhanced basic service” tier.
“It may be that any number of consumers would reasonably consider the practice of adding a new cable channel to an existing tier of service (rather than offering it as a separate channel) and charging more for the service is somehow “unfair,” wrote Judge Hogue. “But the fact remains that federal law expressly allows it and expressly forbids states from invoking their own consumer protection laws to interfere with the deregulated structure imposed by Congress.”
The judge dismissed the lawsuit against all the defendants. She did so without leave to amend, meaning that it’s over, notwithstanding any appeal.
The Los Angeles Lakers are 16-30 so far this season. That, at least, is their record on the basketball court.
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