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SCOTUS Low Approval & NFL Antitrust Exemption | Bloomberg Law

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793 segments

0:02

This is Bloomberg Law with June Graasso

0:05

from Bloomberg Radio.

0:08

In recent years, the Supreme Court has

0:11

gotten what you might call bad grades

0:13

from the public, and it's gotten worse

0:16

since the last term. Americans are now

0:19

more displeased with the court than at

0:21

any time in the last 26 years. According

0:24

to the latest Gallup poll, only 33% of

0:28

the public approves of the job the

0:30

Supreme Court is doing, a record low.

0:33

Joining me is Bloomberg Supreme Court

0:35

reporter Greg Store. Greg, tell us about

0:38

the latest polls.

0:40

>> There were several new polls that came

0:42

out after the court's term ended, and by

0:44

far the worst of them was the Gallup

0:46

poll that showed the Supreme Court's

0:48

approval rating plummeting to 33%. That

0:52

is easily the lowest since Gallup

0:54

started surveying about the court in

0:57

2001. The number went down 9 percentage

1:01

points from 42% when they took it in

1:04

September. So really a big decline

1:07

there. The other polls were not as

1:09

stark, but for example, a Marquette Law

1:12

School poll showed the court down two

1:14

percentage points from a year earlier.

1:17

So, it's consistent with the notion that

1:19

at best the Supreme Court is treading

1:21

water.

1:21

>> In the Gallup poll, was it a slide among

1:25

Republicans that brought that number

1:27

down?

1:28

>> It was a slide mostly among Republicans.

1:31

The court's approval ratings were

1:33

already really low among Democrats and

1:36

independents. But among Republicans,

1:39

support dropped 21 percentage points

1:41

since September. It was 79% in

1:43

September, fell to 58%. With a plus or

1:46

minus margin of error of four percentage

1:48

points, that's definitely a big big

1:50

drop.

1:50

>> A huge drop. And you would think that

1:52

the way the Supreme Court ruled this

1:55

term on Republican priorities like

1:59

narrowing agency power, enhancing gun

2:03

rights, eliminating campaign spending

2:06

restrictions. The Republicans would be

2:08

happy with the court. Well, one big

2:10

reason sure seems to be Donald Trump and

2:13

the way he's reacted. The court, of

2:15

course, ruled against him on a couple

2:16

big issues, including tariffs and his

2:18

ability to fire Lisa Cook and his

2:20

birthright citizenship restrictions. And

2:23

Donald Trump was extremely aggressive,

2:26

lashing out at even those justices he

2:29

appointed like Amy Coney Barrett and

2:30

Neil Gorsuch. If you recall, after the

2:32

tariff decision, he said, among other

2:35

things, that they are an embarrassment

2:36

to their families. So, Republicans of

2:39

course do respond very strongly across

2:42

the board to things Donald Trump says

2:43

and sure seems like his criticisms of

2:47

the Supreme Court drag the court down

2:49

with Republicans.

2:51

>> Tell us about some of the factors that

2:53

have made this Supreme Court so

2:57

unpopular with Democrats and

3:00

independents.

3:01

>> There have been a lot of forces over the

3:03

years that have been dragging the court

3:05

down. This is not just a one-year thing.

3:07

This has been happening over the course

3:08

of a couple of decades. And of course,

3:10

we're seeing institutions in general

3:12

have their approval ratings falling. But

3:14

you have a combination of a court that

3:16

seems more partisan, and indeed they are

3:18

more partisan in the sense that it's the

3:20

Republican justices who are now the most

3:22

conservative and the Democratic justices

3:24

who are the most liberal. You have

3:26

things like the ethical controversies

3:27

that we had a few years ago that were

3:29

very much in the news. Clarence Thomas

3:31

accepting trips uh paid for by a

3:33

Republican mega donor. You have the way

3:37

the court acquired this conservative

3:40

supermajority with Republicans holding

3:42

one seat open after Antinine Scalia died

3:44

and then rushing to fill another one

3:46

when Ruth Bader Ginsburg died. So

3:48

there's kind of a perfect storm. Oh, I

3:50

haven't even mentioned overturning Roie

3:52

Wade, which obviously was a decision

3:54

that was highprofile and among many

3:56

people extremely unpopular. So a

3:59

combination of factors have kind of

4:01

gotten us to this point. So there were

4:03

two decisions where the Supreme Court

4:05

went against President Trump on the

4:07

tariffs and birthright citizenship

4:10

in the sea of decisions where they, you

4:13

know, helped move forward his agenda on

4:16

the regular docket and on the shadow

4:18

docket. Some people are pointing to

4:20

that, even Justice Kagan are pointing to

4:22

those two as well. We're holding the

4:23

line here. Well, I did think that

4:25

Justice Kagan's remarks this summer were

4:28

very interesting because after the

4:31

ruling that overturned Roie Wade three

4:33

years ago, she pretty much called into

4:36

question the court's legitimacy in a

4:37

couple public appearances, saying that

4:39

when the court is overturning cases

4:41

isn't being consistent, that it can call

4:44

into question its own legitimacy. So,

4:46

the fact that she was in at least in

4:48

some sense standing up for the court

4:51

this summer, I did think was notable.

4:53

Having said that, she was very strongly

4:56

in descent from a number of the

4:57

decisions you mentioned where the

4:58

conservative majority uh moved the law

5:01

in a particular direction in a way that

5:03

conservatives have been hoping for for

5:05

quite a long time.

5:06

>> Is anybody else buying that argument

5:08

that, you know, oh well, we held the

5:11

line on these two cases where if they

5:13

hadn't held the line, it would have been

5:16

shocking.

5:17

You know, Jude, I I hate to say this as

5:19

somebody who covers the Supreme Court,

5:21

spends all my waking hours or at least

5:23

my work hours thinking about how to

5:24

communicate what the Supreme Court is

5:26

doing. But the truth is, a lot of

5:28

Americans don't pay attention to what

5:30

the Supreme Court is doing unless it's

5:32

one of these mega cases like overturning

5:34

Roie Wade or deciding a presidential

5:36

election or something like that. So, you

5:39

know, people often have impressions of

5:42

the court. They've heard a little bit.

5:44

If you look at these polls, it's kind of

5:45

remarkable how little people have heard

5:48

about some cases that I think

5:49

everybody's heard about, first rate,

5:51

citizenship, tariffs, things that you

5:52

you mentioned. Uh so, you know, what

5:56

people think of the court may be in a

5:58

lot of cases more impressionistic than

6:00

something that is really tied to

6:02

particular decisions that that came out.

6:05

>> And in your story, you write that the

6:07

justices have said in public that they

6:10

don't consider polls.

6:12

>> Yeah. They've said that over and over in

6:14

a variety of different contexts. So, one

6:16

thing I mentioned in the story was in

6:18

the Dobs ruling which overturned Roie

6:20

Wade. Uh, Justice Alo mentioned that

6:23

the, as he put it, the judicial branch

6:25

derives its legitimacy not from

6:27

following public opinion, but from

6:29

deciding by its best lives whether

6:31

legislative enactments of the popular

6:33

branches of government comport with the

6:35

Constitution. Other justices have said

6:37

similar things. On the other hand, we

6:39

discussed Justice Kagan talking about

6:41

the court's legitimacy. The court and I

6:44

would venture to say all the justices

6:46

understand that their legitimacy is

6:49

really important as a country, as a

6:52

republic. We need people, both average

6:55

people and other members of the

6:57

government to accept Supreme Court

6:58

decisions even if they don't agree with

7:00

them. We need people to be like Al Gore

7:03

who can say after the Bush v.Gore your

7:05

decision. I disagree strongly, but I

7:07

accept it. Otherwise, you know, we run

7:10

the risk of chaos where despite what the

7:13

Supreme Court says, people say we are

7:16

going to go off in our own direction,

7:18

interpret the Constitution our own way.

7:21

>> I know they say that they don't care

7:22

about the polls in public, but I have

7:24

this feeling like some of them must be a

7:27

little bit upset about the fact that

7:28

they're at record lows and that, you

7:30

know, the public is seeing them as

7:32

politicians in robes. I mean they come

7:34

out and defend themselves and you see

7:36

you know Justice Roberts trying to

7:38

emphasize the number of unanimous

7:41

decisions and also talk about we don't

7:44

overturn president as much as some past

7:46

justices. I mean it seems like they're

7:48

doing a lot of explaining. It is

7:51

certainly the case that if you went to

7:52

any of the nine of them and said you're

7:54

acting like a politician, they would uh

7:57

tell you in very strongly worded terms

7:59

why they don't think they're a

8:00

politician, why they are just

8:02

interpreting statutes and interpreting

8:04

the Constitution the way they think they

8:05

should be interpreted.

8:07

>> I am puzzled by one of the polls that

8:10

found that a majority approved of the

8:12

decisions the court made while not

8:14

approving of the court itself. One thing

8:17

that to me is fascinating about these

8:19

polls is that even as the court is

8:23

becoming less popular, its decisions at

8:26

least in this last term were actually

8:28

quite popular. So if you look at the

8:30

Marquette poll, they asked about 13

8:32

recent Supreme Court decisions and a

8:35

majority of people said the justices had

8:37

made the right decision in 11 of those

8:39

cases. So there is when you ask people

8:42

about the particular issues the Supreme

8:44

Court is deciding there is some support

8:46

for what the Supreme Court is doing even

8:48

as the court as a whole as an

8:49

institution goes down in the public

8:52

mind.

8:53

>> There have been calls for a long time

8:55

from liberal groups to either add

8:58

members to the court packing the court

9:00

or set term limits. Do you think that

9:03

come 2028 in the presidential election,

9:07

we're going to be hearing more about

9:09

making changes to the court in some way?

9:11

>> Yeah, I expect very much we will hear a

9:14

lot about this on the Democratic side.

9:16

We already have Pete Buddhajudge and Kla

9:18

Harris as two prospective candidates who

9:21

are pushing the idea of of adding seats

9:24

to the Supreme Court. Uh others are

9:27

talking about things like term limits

9:30

and you of course right now it's just

9:32

talk because Democrats are not in a

9:34

position to do that but you don't have

9:35

to squint too hard into the future to

9:37

imagine a world where Democrats might

9:39

have control of both Congress and the

9:41

White House. And then the question would

9:43

be will they do something about the

9:45

Supreme Court now that they they have

9:47

that power? And you know we may see a

9:50

dividing line among Democrats some who

9:52

will say we need to do something now.

9:54

this is a thing that will, you know,

9:56

make an instant change adding seats to

9:58

the Supreme Court and others who say,

10:00

"Look, if we do it when we have the the

10:03

power to do it, as soon as Republicans

10:05

get back in power, they're going to do

10:07

it and that's not good for anybody."

10:09

>> You talked to Jesse Wegman of the

10:11

Brennan Center and he said, "This court

10:13

is not going to change its behavior. It

10:16

was instituted precisely for this

10:18

behavior." And the way I think you solve

10:20

this is structurally, which is what

10:22

we've been talking about. I mean, last

10:24

term the conservative majority certainly

10:27

changed the law. Are any cases coming up

10:30

next term that might give them the same

10:32

kind of opportunities?

10:34

>> We don't yet have the boundary pushing

10:36

cases that we had last term. So, I would

10:39

say birthright citizenship, tariffs,

10:42

Lisa Cook, all of those were Donald

10:44

Trump doing something that a couple

10:47

years ago nobody was really thinking a

10:50

president might be able to do. And we

10:52

don't yet have those cases, but we

10:54

might. You know, so many of these uh

10:56

cases at the lower court level get up to

10:59

the Supreme Court through the emergency

11:01

or shadow docket and can present that

11:04

sort of issue. That's what happened with

11:06

with Lisa Cook. So, it is certainly

11:09

possible. You know, for the most part,

11:11

we have seen, the way I think about it

11:13

is we have seen this court do most or

11:17

all of the things that Ronald Reagan

11:19

would have wanted that the kind of

11:21

Reagan revolution, the notion of let's,

11:24

you know, get back to, you know,

11:26

originalist interpretation of the

11:27

Constitution. Let's bolster the power of

11:30

the presidency and, you know, reduce the

11:32

role of race in our in our government.

11:35

all those things that are long-standing

11:37

conservative priorities, the court has

11:39

been willing to do those things. It's

11:40

where Donald Trump has sort of created

11:42

his own priorities that maybe aren't

11:44

things that the Reagan folks would have

11:46

thought of. That's where the court is

11:48

sometimes drawing that line.

11:49

>> Finally, there was a rumor that Justice

11:52

Alo was going to retire last term and he

11:56

has said that he is not retiring this

11:59

term at least.

12:01

>> He did say that. I can only tell you

12:02

what words he used. This was in an

12:04

interview with the editorial features

12:06

editor of the Wall Street Journal. So,

12:07

sort of a friendly audience. Uh, Justice

12:10

Alo told them, obviously, I'm here for

12:13

another term. And the reason that we're

12:15

talking about this now is normally if a

12:18

Supreme Court justice is going to

12:20

retire, he or she does that at the end

12:22

of a term. It's the least disruptive for

12:24

the court. You know, if you leave in the

12:27

middle of the term, then you end up

12:28

with, you know, maybe only an eight

12:30

justice court. And so when Justice Alo

12:32

didn't retire at the end of this this

12:34

last term, normally one would think,

12:36

okay, he's going to stick around for

12:37

another term. But because there is at

12:40

least the prospect that Democrats could

12:42

take over the Senate in the November

12:45

midterm election, there has been some

12:48

talk that if that happened, maybe

12:51

Justice Alo, who's very conservative,

12:53

might say, or at least come under

12:54

pressure to say, "I'm going to retire

12:56

now so that the lame duck Congress with

12:59

the Republican controlled Senate, can

13:01

confirm my successor." These comments

13:04

seem to preclude that. Obviously, things

13:06

can change, but he at least sounded from

13:09

what I can read in this story as

13:11

somebody who's not at all planning on

13:13

leaving in November.

13:15

>> Thanks so much for taking the time,

13:16

Greg. That's Bloomberg Supreme Court

13:18

reporter Greg Store. Coming up next is

13:21

the NFL breaking antitrust law in its

13:24

negotiations with streaming services.

13:27

This is Bloomberg.

13:31

It's a tough time for football fans who

13:34

live outside their favorite team's home

13:36

market. The rise of streaming services

13:39

has ended the era when sports fans could

13:42

easily follow their favorite teams on a

13:45

handful of broadcast and cable channels

13:48

without buying special subscriptions.

13:51

But the NFL has signed deals with

13:53

multiple services, creating a

13:56

bewildering schedule and a steep cost to

13:59

watch games at home, as fans have to

14:02

subscribe to multiple streaming services

14:04

in addition to a traditional cable or

14:07

satellite bundle. During a judiciary

14:09

subcommittee hearing in June, Republican

14:12

Congressman Jim Jordan described the

14:15

challenge football fans face trying to

14:17

watch their favorite team. Here's what

14:20

the fan deals with today in our report.

14:23

A Green Bay Packers fan who lives in

14:25

Dallas, Texas, grew up in Green Bay,

14:26

loves the Packers, wants to watch the

14:28

Packers, grew up in Dallas, Texas. For

14:29

the 2026 season, the Packers are

14:31

scheduled to play eight games on Fox,

14:33

two games on Amazon Prime Video, two

14:35

games on Netflix, two games on NBC, one

14:37

game on ESPN, one game on CBS, and one

14:39

unscheduled game that is left to be

14:41

determined by the NFL. The fan will need

14:43

access to Amazon Prime Video, Netflix,

14:45

NBC, and ESPN to see the seven games

14:47

scheduled for those services for the

14:50

nine games scheduled for Fox and CBS.

14:52

The fan will likely need Fox and CBS

14:53

because some of the games will be on

14:55

broadcast television in Dallas. The fan

14:57

will also likely need Sunday Ticket just

14:58

to watch some subset of the nine Fox CBS

15:00

games because the fan will not know

15:03

which games will and will not be on

15:04

broadcast until the NFL and relevant

15:06

networks release the broadcast maps the

15:08

week of the games. That's what they got

15:10

to navigate. That's what they got to

15:12

navigate.

15:13

>> The Justice Department has opened an

15:15

antitrust investigation into whether the

15:18

NFL is breaking antitrust law in its

15:21

negotiations with streamers and driving

15:24

up the costs for consumers. My guest is

15:27

an expert in antitrust, Harry First, a

15:30

professor at NYU Law School. Harry, some

15:33

of our Bloomberg reporters looked into

15:35

this and so for a Philadelphia Eagles

15:38

fan living outside of Pennsylvania to

15:41

get all the games the Eagles are in,

15:44

they would need Sunday Ticket at $378,

15:49

YouTube at $83,

15:51

Peacock at $33, Fox One at $20, and

15:56

Prime Video at $9 for a grand total of

16:00

$523. $3. Yet the NFL claims that 87% of

16:06

its games are primarily shown on free

16:09

overthe-air broadcast TV.

16:12

>> I mean, I assume that that's true, you

16:15

know. Yeah. So, if you want to just want

16:17

to watch the Eagles, I mean, you know,

16:19

it's going to be on free overtheair

16:21

television. But if you want to watch

16:23

away games, you know, if you want to

16:25

just sit there on a Sunday and watch

16:27

every game out of your market, you're

16:29

going to have to pay for it. if you want

16:30

to watch every time the the Eagles play,

16:34

you know, in LA, it's not going to be on

16:37

channel 10 in Philadelphia. So, yes, if

16:41

you fly to LA, it'll be there for free,

16:43

too, but not exactly free. So, I don't

16:46

know the the number, it's one of those

16:49

numbers that will convince no one.

16:51

Obviously, a lot of people are buying

16:53

this Sunday ticket to watch out of

16:55

market football games because they just

16:57

love sitting there watching their team

16:59

wherever they are and other teams, you

17:01

know, cuz there are teams all around the

17:03

country that you can't see on

17:05

overthe-air TV unless you pay extra for

17:08

it. The investigation is reportedly

17:11

focused on this antitrust loophole in

17:13

the Sports Broadcasting Act that allows

17:16

the NFL and other leagues to negotiate

17:20

media deals collectively on behalf of

17:23

their teams. And that's the same

17:25

loophole that the congressional

17:27

subcommittee was looking into in June.

17:29

>> So the lawyer in me doesn't like to call

17:31

them loopholes, likes to call them

17:34

exemptions. you know, in 1961. Yes. It's

17:38

interesting to try to think about and

17:40

I'm not certain I fully understand why

17:44

the over there broadcasters went along

17:46

with this cuz they were, I think,

17:49

relatively more powerful than the NFL in

17:52

1961, which was, you know, not the

17:55

juggernaut we know today. So they

17:58

allowed the NFL to pull all their TV

18:03

rights free of any antitrust issues. the

18:07

law was in some ways less settled then

18:09

and you know maybe it was a little less

18:12

clear but they clearly would have had

18:13

some problems and there had been

18:15

litigation and I think everyone thought

18:17

it was in their best interest to to

18:19

negotiate with a single source have this

18:23

brand NFL football which then I guess

18:26

the TV networks could sell to

18:28

advertisers cuz you know that's that's

18:31

their game. So in that sense it was a

18:34

good deal for those two powerful sides

18:37

you know who then got this through

18:39

Congress. I doubt that the fans showed

18:41

up for legislative hearings and um you

18:45

know in the end the fans didn't pay

18:47

directly because those are overtheair

18:51

quote unquote free broadcasts but you

18:54

know someone picks up the tab for the

18:55

advertising so consumers do pay. You had

18:59

the congressional hearing in June and of

19:01

course politicians on both sides

19:04

questioned

19:05

>> whether the deals now violate that law.

19:09

Do you think they violate that law?

19:12

>> Well, in a technical sense, the question

19:14

is whether the exemption applies to some

19:19

of the current deals. So if it's a deal

19:21

that involves broadcasting rights where

19:24

the broadcast is paid for by sponsors,

19:28

in other words, advertiser supported,

19:30

then that comes within the Sports

19:32

Broadcasting Act. But the current deals

19:35

that the NFL's negotiating are with, you

19:39

know, platforms are with streaming

19:40

platforms.

19:42

pretty hard to see how they're within

19:44

the wording of the exemption from the

19:48

Sports Broadcasting Act. So, the Sports

19:51

Broadcasting Act wouldn't give the NFL

19:54

an exemption. They'd have to go straight

19:56

under the antitrust laws. And then the

19:58

question is whether violates the

19:59

antitrust laws. And they got pretty much

20:03

socked in the Sunday ticket litigation

20:06

uh with a pretty clear binding from a

20:09

jury. So the pooling of rights

20:10

apparently keeps some of the teams from

20:14

negotiating separately to sell their

20:17

broadcasting rights to, you know, maybe

20:19

other streaming platforms or put them on

20:22

YouTube where, you know, you would just,

20:24

if you didn't want to get a whole

20:26

package, all you wanted to do was follow

20:28

the Eagles, you would want to get a

20:30

package just of Eagles games. But that

20:33

can't happen now. So, they would be in

20:36

for some litigation if they don't fall

20:39

within that exemption.

20:40

>> And why did the judge toss out that

20:43

almost $5 billion jury verdict against

20:46

the NFL in the Sunday ticket class

20:49

action lawsuit?

20:51

>> So, there are two answers to this. The

20:53

first answer that I uh often would give

20:56

in class was it's the zeros.

20:59

>> I get that. Now, that's not that's not a

21:01

legal answer, but this was probably the

21:04

largest plaintiff's verdict, certainly

21:07

in any trust, maybe in any plaintiff's

21:09

verdict, but $4.7 billion before

21:12

trembling is a lot of money. Now, that

21:17

can be a reason for knocking down the

21:21

amount, but that's not what the judge

21:23

did. He disqualified

21:25

two of their experts on damages that he

21:29

had actually qualified at the trial. So

21:33

it seems a little like let me find a

21:36

problem with this trial. And

21:38

interestingly he did not find a problem

21:41

with liability in itself. It was on the

21:43

damages I think. So that case has sort

21:46

of been has been sitting before the

21:48

court of appeals now for a while uh

21:51

waiting for a decision. So, um, what, so

21:54

the the Justice Department is launching

21:58

an investigation into whether the NFL

22:01

and the leagues are breaking antitrust

22:03

law in their negotiations with

22:05

streamers. Is that different from the

22:07

Sunday Ticket?

22:09

>> I don't know exactly which negotiations

22:11

they have in mind. I mean, the Sunday

22:14

Ticket litigation involves an agreement

22:16

to distribute and also they had it with

22:19

Direct TV first and then with YouTube

22:22

that if you wanted access to these

22:25

games, you would buy it and it would be

22:28

streamed on YouTube. Now there are other

22:31

they're licensing Netflix, Amazon. So

22:34

they're licensing a bunch of different

22:37

platforms, but the problem is the same

22:41

without regard to which platform it is.

22:44

It's the question of, you know, is the

22:46

NFL a single entity or are they a group

22:50

of however many teams, 32 teams all

22:53

coming together and agreeing that

22:57

they're going to sell their rights

22:58

jointly. pull their rights because each

23:01

one has the right, you know, the legal

23:04

right, the copyright to the games that

23:07

they're involved with. So, they're

23:08

pooling all the rights to make a single

23:11

product called NFL football. So, is that

23:16

coming together is an agreement and

23:18

that's section one of the Sherman Act.

23:20

Now, whether that's lawful or not is

23:22

something that the NFL presumably would

23:25

fight. these sports leagues haven't had

23:27

great track record in saying, "Gee,

23:29

we're coming together for your good."

23:31

So, I don't know. Now, when you say the

23:34

um the Justice Department is

23:36

investigating, the careful approach that

23:39

I would suggest is there are reports

23:42

that the Justice Department is

23:43

investigating. We really don't know what

23:45

they're doing. And frankly, I'm not

23:48

sure, you know, in looking back at the

23:50

antitrust history here, I don't think

23:52

the government has necessarily spent its

23:55

prosecutorial resources worrying about

23:58

competition in professional

24:01

sports. They've usually left it to the

24:05

people with money in the game, the

24:06

owners, fans, consumers, things like

24:10

that. So, why are they interested in

24:13

this? Uh, why do you think? Well, we

24:17

know the answer. The staff report, you

24:20

just mentioned the House NHS

24:22

subcommittee staff report starts out

24:24

with a quote from the president. There's

24:27

something very sad when they take

24:30

football away from many, many people. He

24:33

said that in May and I'm glad that he

24:36

has empathy for, you know, the cost of

24:39

living.

24:40

>> I'm going to refrain from making a

24:42

comment on that. Harry, this justice

24:44

department has not been, shall we say,

24:46

strong on antitrust enforcement. They

24:50

walked away from the ticket master live

24:52

nation trial and left it to the states

24:55

who then won. They also walked away from

24:58

the Paramount Warner Brothers Discovery

25:00

merger, leaving it to the states to sue.

25:04

Do you think they would really sue the

25:06

NFL? I don't really see any government

25:09

group doing anything here because

25:12

they're just going to rub some important

25:14

economic interest the wrong way. I mean,

25:16

I don't see Congress doing anything. The

25:19

House report didn't say, "Oh my god, we

25:22

have to repeal this statute." Or, "Oh my

25:25

god, we have to amend it." Or, "Oh my

25:27

god, we have to do something." No, they

25:29

said, "Oh my god, we've got to stand

25:31

here and look. We've got to keep watch."

25:33

And thank you very much. We're going on

25:35

recess. I mean, I don't know, maybe

25:37

they've got a big investigation going,

25:40

but there are a lot of big mergers going

25:42

on in the economy and although private

25:45

parties get involved in those

25:47

occasionally, that's really fallen to

25:49

the government to do something about not

25:52

that they're doing a lot about them, but

25:54

at least they've got to review them and

25:56

they're involved. So they have important

25:58

or stuff that demands government

26:00

attention maybe more than this because

26:03

we have private enforcement and the

26:06

private enforcement's been at work,

26:08

>> right? So there might be a private

26:10

antitrust suit

26:12

>> indeed. I mean that's you know that's

26:14

what Sunday Ticket litigation was and

26:16

you know would not be surprising if

26:19

there were.

26:19

>> So we shall see. Stay with me. Coming up

26:23

next on the Bloomberg Law Show,

26:25

Paramount is trying an interesting

26:27

tactic to try to get a resolution of the

26:30

antitrust case filed by 12 states to

26:33

block the Paramount Warner Brothers

26:35

Discovery merger. I'm June Grao and

26:38

you're listening to Bloomberg. Let's

26:40

turn now to the Paramount Warner

26:44

Brothers Discovery Merger. So 12 states,

26:48

Democratic le states led by California's

26:53

attorney general Rob Bont are suing to

26:56

block the merger. And David Ellison told

27:00

Paramount senior executives

27:03

last week that he's prepared to relocate

27:06

Paramount and Warner Brothers 2 if the

27:09

merger is successful. So, exiting

27:12

California, if the California AG doesn't

27:15

agree to negotiate a settlement in the

27:17

case, what do you think about a threat

27:20

like that to a state AG who's suing you?

27:23

>> I don't know how that helps him in any

27:26

particular way. First of all, it doesn't

27:28

really do anything about the litigation.

27:30

So, I assume that

27:32

California and the other states who have

27:35

filed would still have jurisdiction in

27:38

one way or the other over this merger

27:40

because they've got movie theaters. So,

27:43

I don't know how it affects that. So, it

27:46

seems just sort of like a political

27:48

threat. I guess he's he's threatening to

27:50

destroy Hollywood. I in some ways I I

27:52

feel like the the discussion of this is

27:56

that Ellison and the I don't know who's

27:58

advising him. They just don't seem to

28:00

want to see the antitrust issues and

28:02

they just don't want to see this as a

28:04

piece of real litigation. They're

28:07

entranced by Bont standing in front of

28:09

the Hollywood sign. And you know that's

28:12

that's theater, but it's not the

28:14

litigation. So it's just hard to know

28:17

what he thinks is going to move these

28:20

attorneys general, but moving is not

28:23

going to be moving these attorneys

28:25

general.

28:26

>> That only takes out one attorney

28:28

general. It doesn't take out the rest of

28:29

them.

28:29

>> Yeah. So, so then he's going to have Tis

28:32

James to negotiate with. Okay. Yeah. The

28:37

bottom line problem is this is a case

28:40

that as it's written is really hard to

28:43

settle. I mean, you either win or lose

28:45

this litigation. Maybe he doesn't want

28:47

to acknowledge that or something. And to

28:49

some extent, he's sort of talking past

28:51

litigation, but either they're going to

28:52

win or lose this litigation. I don't see

28:55

it settling. You know, maybe in the end

28:56

they'll just have to restructure this

28:58

deal.

28:59

>> What about Paramount has agreed to sign

29:02

contracts with the major theater chains

29:05

guaranteeing they'll release 30 movies a

29:07

year in cinemas if they acquire Warner

29:11

Brothers. Three-year agreement.

29:13

>> Great. So, first of all, this is not the

29:16

kind of thing that convinces any

29:18

legitimate any trust enforcer of

29:21

anything. So, any time you say it's a

29:24

three-year contract and any trust

29:26

enforcer says, "Okay, what about the

29:28

fourth year? You want to merge forever

29:31

and you're giving me something for three

29:33

years?" Uh, it's not all that good. All

29:36

right. Second is, so what's the deal?

29:38

You're promising 30 movies. Doesn't say

29:42

these are 30 you would not have made.

29:44

That was an earlier claim. 30 movies you

29:48

promise to distribute in these two major

29:51

chains. Great. Come look at my coalition

29:55

and ask whether they've got any movie

29:57

theaters that are not in these chains

30:00

and are not part of this deal. They'll

30:02

love this. So great, now you've hooked

30:05

up with the two major distributors for

30:08

exclusive distribution of your films. I

30:10

think I'll throw that in as another

30:13

count of any competitive behavior. I

30:16

really don't get it. You know, if he

30:18

said, "We promise to make deals with all

30:21

of the movie theaters in the United

30:23

States. You we'll give a 90-day window

30:26

that we won't put these movies online.

30:29

Anything we make that looks a little

30:31

different. I'm not sure what it gets in

30:33

particularly, but again, this is I don't

30:36

get it.

30:36

>> If you don't get it, then it's not

30:38

getable." Um,

30:41

so does it matter that the UK authority

30:44

gave the deal a go-ahad?

30:46

>> So I think that's a plus for the deal.

30:49

The UK authority was worried about

30:51

editorial controls and that's not part

30:54

of this complaint. So in some ways I

30:58

mean it's sort of ironic. This is not

31:01

what the states are complaining about.

31:03

They are not complaining about CNN being

31:06

run by CBS even though again Ellison

31:10

said oh that's what you're upset about

31:12

and Bont says not us go you look in the

31:15

complaint CNN isn't mentioned to me that

31:19

was one of the political things that was

31:22

pushing the merger and so it's it's

31:24

really ironic that Ellison wants to pin

31:27

that on the states the states want to

31:29

say not me we are so clever we are not

31:33

going there, folks.

31:35

>> Well, as you said last time we talked,

31:37

it was a well-drawn complaint by a

31:40

powerhouse antitrust lawyer that the

31:43

state of California hired. So, they

31:46

appeared to have made the right choices.

31:48

Always a pleasure, Harry. Thanks so

31:50

much. That's Professor Harry First of

31:52

NYU Law School. And that's it for this

31:55

edition of the Bloomberg Law Show.

31:56

Remember, you can always get the latest

31:58

legal news on our Bloomberg Law

32:00

podcasts. You can find them on Apple

32:02

Podcast, Spotify, and at

32:04

www.bloomberg.com/mpodcastlaw.

32:09

And remember to tune in to the Bloomberg

32:10

Law Show every week night at 1000 p.m.

32:13

Wall Street time. I'm June Graasso and

32:16

you're listening to Bloomberg.

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