Disney Fails Again To Get Antitrust Class Action Over ESPN & Hulu Ownership Tossed Out
Walt Disney Studios and the Walt Disney Co. headquarters in Burbank AaronP/Bauer-Griffin/GC Images
Disney’s efforts to have an antitrust class action from streaming subscribers dismissed has been denied one more time, but the company will now not be on the hook for any cash.
“The Court once again finds Plaintiffs’ allegations sufficient to plead Disney’s market power in a well-defined SLPTV market in the United States,” wrote U.S. District Judge Edward J. Davila today in a complex and mixed bag ruling for the Mouse House (read the order here).
Back in November 2022, YouTube subscribers in a quartet of states filed a class-action complaint alleging that Disney’s control of both ESPN and Hulu has allowed the Bob Iger-run media giant to “inflate prices marketwise by raising the prices of its own products” and also “set a price floor.” The bold action detailed that because Disney requires streamers, including YouTube TV and Sling TV, to include ESPN in base packages, they are paying more for their subscriptions than they should.
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The 82-page complaint additionally claimed antitrust violation on the grounds that Disney’s control of content and distribution, including operating control of Hulu and its Hulu + Live TV, presented a barrier to entry in the market.
In tones and terms very similar to what he decided back in October last year, the order in part granting and in part denying Disney’s latest move to have the November 2022 filed action thrown out will allow the case to go forward in a further reduced form. However, the California-based Judge Davila has also cut any attempt at damages by the plaintiffs from the matter. Without cash on the table, what is left is the possibility of injunctions that would stop Disney from engaging in such antitrust violations in the future.
“Because Plaintiffs have specifically alleged that the terms of the MFN provision permit Disney to set a price floor and raise its competitors’ ESPN prices (which translate to the subscription package prices) whenever it raises Hulu’s prices, the Court finds Plaintiffs’ allegations sufficient to plead Disney’s market power in a well-defined SLPTV market in the United States,” Judge Davila wrote Tuesday.
The Walt Disney Company did not respond to request for comment on today’s order. If and when they do, this post will be updated.
Of course, Disney isn’t exactly unfamiliar with antitrust allegations of late. Along with Warner Bros Discovery and Fox, Disney is also facing a February filed antitrust action from Fubo over the trio’s planned Venu sports streamer service. Venu is set to debut in the fall, just in time for the start of the NFL season — a league it seems to have very little of to stream.