Federal judge rules against NCAA in antitrust lawsuit

[JURIST] The US District Court for the Northern District of California [official website] on Friday ruled [materials] that the National Collegiate Athletic Association (NCAA) [official website] cannot prevent college football and basketball players from selling the rights to their names and likenesses. The class action case was brought by a group of current and former college student-athletes, who alleged that the NCAA rules that bar student athletes from receiving a share of the revenue generated from using their names and likenesses violate the Sherman Antitrust Act [text]. The court found that the NCAA rules unreasonably restrain trade in the market for certain educational and athletic opportunities offered by NCAA Division I schools. The court also issued a permanent injunction prohibiting certain overly restrictive restraints. Because the agreement among Football Bowl Subdivision (FBS) football and Division I basketball schools not to offer recruits a share of their licensing revenue eliminates one form of price competition—even indirectly—the restrictions violate antitrust laws. Writing for the court, Judge Claudia Wilken stated:

The fact that this price-fixing agreement operates by undervaluing the name, image, and likeness rights that the recruits provide to the schools—rather than by explicitly requiring schools to charge a specific monetary price—does not preclude antitrust liability here.
The NCAA stated [text] that they disagree with the decision, but they have not announced plans to appeal.

The NCAA has faced a number of legal issues relating to its compensation and treatment of student-athletes. In March the Chicago office for the National Labor Relations Board (NLRB) [official website] ruled [PDF] that football players at Northwestern University [official website] were employees under the National Labor Relations Act (NLRA) [text, LII], giving student athletes the right to vote to unionize. Unionization among college athletes may signal the potential [JURIST op-ed] for revenue sharing. In 2009 a judge for the Erie County Court of Common Pleas [official website] in Ohio issued a permanent injunction [JURIST report] against an NCAA bylaw that restricted the eligibility of student baseball players who were assisted by legal counsel during negotiations with professional baseball clubs. The bylaw was amended after Oliver v. NCAA [opinion, text], in which the Ohio Court of Common Pleas [official website] ruled [JURIST op-ed] to allow legal counsel for student athletes.

 

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