Comcast Sues DirecTV, Charging False Advertising On NFL

Comcast Corp. (CMCSA) has sued DirecTV Group Inc. (DTV), alleging the satellite-television operator falsely advertises that it offers National Football League Sunday Ticket football programming free of charge.

The largest U.S. cable operator called the free Sunday Ticket offer "an outright lie" and accused DirecTV of misleading consumers in ads disparaging cable companies' football programming. The lawsuit comes as competition heats up among cable companies and satellite operators for a shrinking pool of pay-TV subscribers.

DirecTV spokesmen weren't immediately available for comment.

For the first time this NFL season, DirecTV is offering Sunday Ticket at no additional initial charge to new customers. The package normally costs more than $300 a season and offers fans every NFL game on Sundays.

DirecTV President and Chief Executive Michael White said on a conference call with analysts that the company is seeing a "terrific response" to the Sunday Ticket promotion.

"We're quite pleased with its results so far through the month of July," he added. "But the real test will be when we do renewals next year."

Comcast said the Sunday Ticket offer locks customers into a two-year contract, with service renewing for full price at the end of the first year, according to a complaint filed with the U.S. District Court of the Northern District of Illinois.

"DirecTV's strategy could hardly be more clear--capitalize on enthusiasm for an assured NFL season, claim to offer a costly premium service for 'free,' and get as many cable subscribers to switch to DirecTV before they realize they are trapped in a two-year--and decidedly non-free--deal," Comcast said in the complaint.

The National Football League lockout officially ended Thursday when players approved a new collective-bargaining agreement. The pact ended the threat that there would be no NFL season this fall.

Comcast also said DirecTV wrongly claims that cable subscribers can only view a single NFL game each Sunday during the league's season. It said DirecTV ads in the Philadelphia market claim that Philadelphia Eagles fans can't watch the team's games on Sunday, even though Comcast distributes every Eagles game live through its cable system.

Comcast's class-A shares recently rose 1.3% to $22.08, while DirecTV was down 1.3% at $46.01.

-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240; matthew.jarzemsky@dowjones.com

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