EA Sports agrees to $27 million settlement in football game monopoly lawsuit

EA Sports has reached a proposed settlement of $27 million with the plaintiffs in a class-action lawsuit that claimed the company's exclusive licensing agreements "monopolized an alleged market for interactive football software," ending more than four years of litigation in the federal courts.

The agreement in Pecover v. Electronic Arts only concerns the publisher's licenses for NCAA Football and Arena Football titles; it does not affect EA's lucrative exclusive contract for Madden games.

EA Sports will establish the $27 million settlement fund, which entitles the class-action participants — anyone who purchased a Madden, NCAA Football, or Arena Football title for consoles or PCs between January 1st, 2005 and June 21st, 2012 — to a modest sum: up to $6.79 per copy purchased on PlayStation 2, Xbox, GameCube, or PC, and up to $1.95 per copy purchased on PlayStation 3, Xbox 360, or Wii. If payouts do not exhaust the settlement fund, the remainder will be donated to Child's Play.

EA Sports "does not agree in all respects with Plaintiffs' characterizations" of the laws and facts at issue in the suit — namely, that the publisher violated state and federal antitrust laws by making exclusive agreements with the NFL, NFL Players Association, NCAA, Collegiate Licensing Company, and Arena Football League, and subsequently overcharged consumers for the football games it produced under those agreements.

However, the settlement agreement stipulates that EA Sports will not renew its current exclusive contract with the CLC, which expires in 2014, and will not negotiate any further exclusive agreements with the CLC or NCAA for five years thereafter. In addition, EA Sports agrees not to enter into any exclusive contracts with the AFL for five years from the settlement's date of approval. These are mostly academic restrictions: EA can continue to make NCAA football games after 2014 on a non-exclusive basis — it is unlikely that other publishers would enter the market at that point — and the most recent Arena Football game came out in 2007.

The full proposed settlement is available here (PDF).