Antitrust Lawyer Blog Commentary on Current Developments

Power Conference Commissioners Discuss Legal Threats

On March 17, 2014, sports labor attorney, Jeffrey Kessler, filed suit against the NCAA and five power conferences, alleging that capping player compensation at the cost of a scholarship is an antitrust violation.  The lawsuit argues that limiting player compensation amounts to “price-fixing,” and should be considered a violation of existing antitrust laws.  Unlike previous suits, this one does not seek damages.  The goal of the lawsuit is to change the entire NCAA system and to require a system where players are fairly compensated.

The suit names the NCAA, the ACC, the Big 12, the Big Ten, The Pac-12, and the SEC as defendants.  The plaintiffs are Rutgers basketball player, J.J. Moore; Clemson football player, Martin Jenkins; UTEP football player, Kevin Perry; and University of California football player, William Tyndall; though as a class action claim, the lawsuit hopes to represent all FBS football players and D-I basketball players.

NCAA and the commissioners of the power five college conferences are concerned that this lawsuit may bring down the NCAA’s model of player amateurism.  If players were paid market value, then they would be given the same power as their coaches, who negotiate multi-million dollar contracts with their employers.

This is not the only lawsuit that is worrying the NCAA.  The lawyers for a former West Virginia University running back, Shawne Alston, filed a class-action lawsuit earlier in the month against the NCAA and the five power conferences.  The suit claims that the NCAA has illegally capped athletic scholarships at a value below that of attending college. It seeks to recover all of the out-of-pocket expenses that former FBS scholarship players had to shell out to cover their costs of living, and also to reverse an NCAA rule that prevents athletes from receiving an extra $2,000 stipend.  Any lawsuit against the NCAA is a good lawsuit, and this one is certainly well-intentioned. Alston had to take out a $5,500 loan during his time at school.  The lawsuit claims that he deserves to get that money back.

With Alston’s lawsuit, it is likely the NCAA and the power conferences could settle.  They will agree to allow schools to cover those additional expenses for scholarship athletes.  They will agree to pay some nominal damages to every FBS scholarship athlete from the last four years.

With Kessler’s lawsuit not seeking damages, the NCAA and the power conferences are in the position of having to defend themselves or change the current system.  Recently, the NCAA has shown an indication that it will have to move more quickly to pass expected reforms on giving athletes cost-of-living stipends beyond scholarships, among other measures currently under contemplation by the NCAA and the power five conferences.

 

Andre Barlow
202-589-1838
abarlow@dbmlawgroup.com

Mark Ye
202-589-1834
mye@dbmlawgroup.com