Appeals court reverses Comcast-NFL Network ruling

Updated: February 26, 2008, 11:12 PM ET
Associated Press

NEW YORK -- Cable TV giant Comcast and the NFL Network must return to court to determine the kind of viewing package in which Comcast can put the network.

A state appeals court voted 4-0 on Tuesday to reverse a lower court ruling that had allowed Comcast to distribute NFL Network games on a niche sports tier rather than a larger digital package with more viewers.

The appeals court said the language of the two agreements that govern the relationship between Comcast and the network, both signed Aug. 11, 2004, were too "ambiguous" to rule in favor of either side.

The lower court ruling by Justice Bernard Fried in Manhattan in May 2007 potentially could have cost the network millions of dollars a month.

The NFL Network, which carries league-related programs year-round, broadcast eight live games last season. Because it is not on several large cable systems, they were not viewed outside the areas of the teams involved, where by league rules they were carried by local channels, setting off a controversy over several games, including one between Green Bay and Dallas, which finished with the NFC's best records.

There was one exception: the final Saturday night game in which New England beat the New York Giants 38-35 to clinch an unbeaten regular season. Because there was so much clamor for the game to be seen nationally, the NFL decided to simulcast it on NBC and CBS.

The two teams met again in the Super Bowl with the Giants beating the Patriots 17-14 to ruin their unbeaten run.

The suit was filed by the NFL in October 2006 against the nation's largest cable television operator, after Comcast notified the league that it had decided to put the network on a sports tier with about 750,000 viewers.

Comcast said it was moving the network from a digital tier that is seen by more than 7 million of its 24 million cable customers. A tier carries a specific type of programming and is available to customers at an additional price over the cost of basic cable TV programming.

The NFL opposed the switch because, under an agreement between the two companies, Comcast had to pay the league 55 cents per subscriber each month. Comcast said it made the change because it did not want to charge customers the extra money for NFL programming they might not want in the digital tier.

The NFL argued that the plain language of one of the agreements prohibited Comcast from putting the network on a sports tier.

Both sides argued that the agreements were unambiguous, but the Appeals Court wrote, "We conclude that they are reasonably susceptible to more than one interpretation, rendering summary judgment inappropriate."

The appeals court sent the case back to the lower court judge for further proceedings that are consistent with the appellate decision.

Copyright 2008 by The Associated Press