NEW YORK—The Justice Department and 17 state attorneys general have filed filed briefs in the 2nd U.S. Circuit Court of Appeals opposing an appeal by the backers of Venu Sports that would lift an injunction against the launch of the sports streaming service.
In August, U.S. District Court Judge Margaret Garnett in Manhattan issued a preliminary injunction in Fubo’s antitrust lawsuit against Venu, a sports-centric multichannel video programming distributor backed by The Walt Disney Co.’s ESPN, Fox and Warner Bros. Discovery that blocked it from launching.
Venu’s owners, who had hoped to launch near the start of the NFL season, appealed the decision, which would block operations until the case goes to trial in October of 2025.
The DOJ’s brief against the appeal and in support of the preliminary injunctions called the arguments by the owners of Venu to lift the appeal “a red herring” and “likely misplaced.”
“First, they [Venu] argue the district court improperly ‘grounded its analysis in bundling practices’ predating Venu rather than focusing on the competitive effects of the transaction itself,“ the Justice Department argued. “Second, they contend that “provid[ing] consumers an additional option at a lower price is unambiguously a pro-consumer outcome that cannot violate the Clayton Act. Both critiques are wrong.’ ” (The Clayton Act is a 1914 law passed to curb antitrust practices.)
“This court should hold that Fubo established a likelihood of success on the merits” in its claims against Venu, the DoJ concluded.
In a note to investors, Lightshed Partners analyst Richard Greenfield wrote that the filings reduced the odds that the injunction against the service would be lifted quickly.
“While it is unclear how new DoJ leadership in 2025 will view Venu, the odds of the injunction being lifted ahead of the District Court trial appear to be falling,” he noted. “It will also be interesting to see if this leads to greater questions around bundling practices more generally.”
The attorneys general brief was filed by state AGs in New York, California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey, Oregon, Pennsylvania, Rhode Island, Vermont and Washington, as well as the District of Columbia.
Their brief defended the injunction by arguing that “defendants’ joint venture violates § 7 of the Clayton Act” as it “substantially lessens competition in the relevant market.”
