A U.S. District Judge in California, Claudia Wilken, rejected all of the NCAA’s arguments to dismiss antitrust claims against it in connection with the use of student athletes’ names and likenesses. According to the athletes, the NCAA and others are making huge profits by selling rights that should belong to the players. On October 25, 2013, Wilken ruled that those claims could proceed to the next stage of litigation.
The athletes contend that antitrust laws are applicable because they are forced to give up their rights in order to compete. As a condition of eligibility, the NCAA requires athletes to sign a release form. The form specifies that athletes will relinquish all rights to the commercial use of their images in perpetuity.
The suit further alleges that the NCAA has partnered up with others to bar athletes from being paid. However, Electronic Arts and the Collegiate Licensing Company reached a proposed $40 million settlement with the athletes. Now, the NCAA is left to defend the suit alone.
The ruling is troubling for the NCAA because of the ruling’s discussion about the applicability of previous precedent. The NCAA heavily relies on a previous 1984 ruling by the Supreme Court to implement rules preventing payment to student-athletes. In that case, the Court discussed the NCAA’s right cap the number of televised Division I football games. The Court said the NCAA has the right to adopt rules to preserve amateur status in college sports.
However, on Friday, Judge Wilken said the Supreme Court has never analyzed the NCAA’s right to ban student compensation. She said, while the 1984 ruling “gives the NCAA ample latitude to adopt rules preserving … amateurism…, it does not stand for the sweeping proposition that student-athletes must be barred, both during their college years and forever thereafter, from receiving any monetary compensation for the commercial use of their names, images, and likenesses.”
After the opinion was release, both parties made statements reflecting continued confidence in their positions. The athletes’ said the decision “may finally convince or influence [the NCAA] to pull their heads out of the sand.” The NCAA’s chief legal officer said “we continue to believe the rules establishing the revered traditions of college sports are fully consistent with the antitrust laws… We expect to seek judgment in our favor … in our upcoming summary judgment motion.”
With the case proceeding, student-athletes are one step closer to being compensated. However, it may still be a while before compensation begins; a trial is currently for 2015.
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