Key facts
- Disney agreed to a $50 million settlement to resolve a class-action lawsuit.
- The lawsuit claimed Disney inflated live-TV streaming prices by mandating the inclusion of ESPN.
- Eligible customers subscribed to YouTube TV, DirecTV Stream, DirecTV Now, or AT&T TV Now between April 1, 2019, and March 31, 2026, may receive a portion of the settlement.
- Disney admits no wrongdoing as part of the agreement.
- Disney will consider offering distributors the option to provide fewer Disney-owned channels, including ESPN, for three years.
The Walt Disney Company has agreed to a $50 million settlement to resolve a class-action lawsuit that accused the company of artificially inflating prices for live-TV streaming services. Filed in November 2022 by four YouTube TV subscribers, the complaint alleged that Disney leveraged its ownership of ESPN to force distributors of internet-based broadcast channels to include the sports network in their base packages, thereby increasing overall costs.
The lawsuit argued that Disney used ESPN and its own service, Hulu + Live TV, to establish a price floor in the streaming live pay TV (SLPTV) market. It cited examples such as YouTube TV's base package price increasing from $35 to $65 after the inclusion of Disney-owned channels, and YouTube TV stating its plan would be $15 cheaper without them.
While the plaintiffs sought class action certification and a jury trial, a settlement agreement was reached in March. The court preliminarily approved the deal later that month, with a final approval hearing scheduled for January 14. Under the terms, Disney will pay $50 million to eligible subscribers of YouTube TV, DirecTV Stream, DirecTV Now, and AT&T TV Now who subscribed between April 1, 2019, and March 31, 2026. Disney has not admitted any wrongdoing. The company also agreed to "consider" offering distributors the option to provide fewer Disney-owned channels, including ESPN, for three years post-settlement, though the agreement does not appear to mandate more affordable or "skinnier" bundles.