The Supreme Court handed down a narrow but still unanimous ruling relating to Division I college athletes in their legal fight against the National Collegiate Athletic Association, NCAA, over caps the organization sought to impose on compensation related to education.
This decision could have transformative ramifications for the organization of college sports. At the heart of the issue is the case where the NCAA imposes rules that limit educational benefits for college players as part of their scholarships.
The top court voted 9-0 and affirmed lower court rulings that found that antitrust law prevented the NCAA from restricting payments to athletes for items such as musical instruments or as compensation for internships. In its opinion, the court rejected the NCAA’s argument that its players’ amateur status would be impossible to maintain if they could receive payment, even for education-related expenses.
Collegiate athletes have argued that the NCAA has, in effect, been operating a that restricts competition or put simply, a system that violates the nation’s antitrust laws. NCAA officials’ rebuttal to that claim has been that its rules are exempt from these laws because the rules themselves strive to preserve “amateurism” in college sports, moreover, the rules provide more choice for end consumers as they allow for “distinguishing college from professional sports.”
The amateurism model defense has been at the center of this ongoing litigation and could possibly open up opportunities for future litigation targeting the model. Justice Kavanaugh and Gorsuch, both Former President Trump appointees, provided statements on the ruling, providing a similar message.
“NCAA’s remaining compensation rules also raise serious questions under the antitrust laws,” Kavanaugh stated. “the antitrust laws should not be a cover for exploitation of the student-athletes.”
Kavanaugh added: “It does seem … schools are conspiring with competitors — agreeing with competitors, let’s say that — to pay no salaries for the workers who are making the school billions of dollars on the theory that consumers want the schools to pay their workers nothing. And that just seems entirely circular and even somewhat disturbing.”
Justice Gorsuch also piled on the NCAA writing that the NCAA “seeks immunity from the normal operation of the antitrust laws.”
The college sports world in general, mainly football and basketball, has drawn more public scorn over recent years for these such rules. Barring athletes from receiving any form of compensation outside of the traditional modes like scholarship and the like has not sat well with the fans of these sports.
Athletes are viewed as being exploited at the same time the schools for which they play continually shell out millions of dollars for coaches contract as well as training facilities, arenas, and stadiums that rival that of their professional counterparts.
The NCAA has many rules that, although not an issue in this specific case, is an issue for the public. The one that receives the most attention, the NIL, or the rule that prohibits athletes from earning money off their “name, image ad likeness.” This NIL rule has begun to receive so much bad press that in the majority of states, legislatures either are considering or have already passed laws that ban these restrictions. Five states have already passed such laws and are set to see them go into effect on July 1st.
There are a few examples of how these NIL restrictions hurt athletes’ earning potential, a recent example is Notre Dame quarterback, Brandon Wimbush. As Wimbush sees it, his earnings power should’ve peaked in November 2017 when ESPN used an image of him all week in onscreen promotions of a football showdown between Notre Dame and Miami, but ND’s then-starting quarterback didn’t see a dime from 65,303 tickets sold or the millions ESPN parent Walt Disney Co. pays for broadcast rights.
These NIL restrictions don’t just apply to Wimbush and football athletes but extend into basketball as well with a large portion of the NCAA revenue coming through the sale of licensing fees. CBS and Turner pay roughly $1.1 billion a year in exclusive rights to air March Madness (and other non-revenue sports.) Just the ad revenue alone for the men’s college tournament alone draws in $1 billion each year, while the women’s tournament earns $15 million, and these figures are just for the post-season tournament.
If one begins to contemplate as to what a monopoly is as written in U.S. antitrust law, “monopoly power” is defined as “the power to control prices or exclude competition” it isn’t hard to see where the NCAA could be running afoul. Sure athletes can go from one college to another but when it comes to the institution of college and how it acts as a farm system for the NBA or NFL, there really aren’t many avenues one can go if their hopes are to play professionally. Given this definition, it is difficult to see how the current defense of the NCAA to not provide other types of compensation to their athletes holds any water at all.
Experts such as Amy Perko, CEO of the independent Knight Commission on Intercollegiate Athletics, believe that this change alone will “transform” college athletics, and not just for players who are big stars. “In the modern world we live in, and that these young people live in,” she observes, lesser athletes will be able to “monetize” their names via social media.