By now, I assume you’ve heard that the O’Bannon ruling has been handed down. At its heart, as the New York Times says, it’s a smack down of the NCAA’s amateurism protocol: “Judge Claudia Wilken’s 99-page decision issued a resounding rebuke to the foundation of the N.C.A.A., issuing an injunction against current rules that prohibit athletes from earning money from the use of their names and images in video games and television broadcasts.” But the relief Judge Wilken has fashioned leaves college athletics with a way forward, if the people running the sport are willing to accept it.
Let’s start with the obvious. All the eye-rolling we did as we took in the testimony of defense witnesses like Mark Emmert and Neal Pilson… well, the judge didn’t find what they had to say any more convincing than anyone else did. And that meant the NCAA’s position got blown up in two significant ways.
1. Bye-bye, amateurism.
Wilken rather famously stated before the trial that, “I don’t think amateurism is going to be a useful word here.” She wasn’t kidding. As Stewart Mandel summarized it,
The NCAA argued that preservation of amateurism is essential to its core identity, as evidenced by its century-plus commitment to the concept. Wilken wrote: “… the NCAA has revised its rules governing student-athlete compensation numerous times over the years, sometimes in significant and contradictory ways. Rather than evincing the association’s adherence to a set of core principles, this history documents how malleable the NCAA’s definition of amateurism has been since its founding.”
Making it up as you go along isn’t a defensible strategy? Mark Emmert is crushed.
But the ruling is more crushing than that. Wilken went out of her way to eviscerate every rationale the organization offered as a justification for its position (however shifting) on amateurism. Again, from Mandel:
The NCAA argued that compensating athletes would negatively impact competitive balance in college athletics. Wilken wrote: “… the NCAA has not presented sufficient evidence to show that its restrictions on student-athlete compensation actually have any effect on competitive balance, let alone produce an optimal level of competitive balance.”
The NCAA argued that paying players would adversely affect the integration of academics and athletics on campuses. Wilken wrote: “Student-athletes would receive many of the same educational benefits … regardless of whether or not the NCAA permitted them to receive compensation for the use of their names, images, and likenesses.”
And the NCAA argued that restricting compensation increases output of its product and if lifted, schools might bolt Division I. Wilken was particularly incredulous about this one. “There is no evidence to suggest that any schools joined Division I originally because of its amateurism rules. While there may be tangible differences between Division I schools and other schools that participate in intercollegiate sports, these differences are financial, not philosophical. For this reason, the NCAA’s assertion that schools would leave FBS and Division I for financial reasons if the challenged restraints were removed is not credible.”
Take that, Jim Delany.
Oh, and the whole competitive balance thing? Phhhht.
In disagreeing with the NCAA’s argument that competitive balance justifies not paying players, Wilken noted the average salary for a head football coach exceeds $1.5 million. She also cited testimony by NCAA president Mark Emmert in which he said it’s not the NCAA’s mission to take away advantages universities have made in building up their facilities.
“The fact that high-revenue schools are able to spend freely in these other areas cancels out whatever leveling effect the restrictions on student-athlete pay might otherwise have,” Wilken wrote. “The NCAA does not do anything to rein in spending by the high-revenue schools or minimize existing disparities in revenue and recruiting.”
“Rein in”? Hell, with this week’s autonomy vote, the NCAA’s rolled out the red carpet.
Wilken didn’t just take a dagger and plunge it into the heart of amateurism. She cut that sucker out, threw it on the ground and stomped the living shit out of it. It’s gone.
2. Of course, players’ names, images and likenesses have value.
This may seem ridiculously obvious, but let’s not forget that Neal Pilson testified that no such value was recognized in standard broadcasting agreements. Wilken didn’t buy it.
“The court finds that a submarket exists in which television networks seek to acquire group licenses to use FBS football and Division I basketball players’ names, images and likenesses in live game telecasts,” Wilken wrote. “Television networks frequently enter into licensing agreements to use the intellectual property of schools, conferences and event organizers — such as the NCAA or a bowl committee — in live telecasts of football and basketball games. In these agreements, the network often seeks to acquire the rights to use the names, images and likenesses of the participating student-athletes during the telecast.”
In ruling that a group market exists for live TV broadcasts, Wilken cited television contracts produced by the plaintiffs, such as old NCAA tournament contracts with CBS and an old BCS deal with Fox. She said testimony by former CBS Sports president Neal Pilson that networks enter into agreements with event organizers for access to facilities is “not convincing.”
Wilken noted that Pilson, an expert witness for the NCAA, admitted that “broadcasters must acquire certain rights even from visiting teams who do not control access to the event facility. … He also acknowledged that broadcasting agreements … sometimes refer expressly to name, image and likeness ‘rights.'”
Her ruling in this area may have bigger ramifications than its impact on the NCAA.
Michael Hausfeld, a lead attorney for the O’Bannon plaintiffs, said his team will now consider whether to take any legal action against networks for use of players’ NILs.
“It’s an open field right now because of the antitrust violation,” Hausfeld said. “We’re going to have to take a look at what our next letter might be to ESPN or CBS or Turner. We’ve been looking at it. For example, maybe we don’t go to the larger networks, but go right to the Big Ten Network or Pac-12 Network. Here you have a conference with a most direct relationship to an athlete. They’re clearly use the name, image and likeness.”
Larry Scott’s decision to go it alone on the Pac-12 Network looks more and more expensive every day.
As bad as that looks – and when it comes to the underpinnings of the NCAA’s case as well as the credibility of those who testified on its behalf, it’s about as bad as it gets – Wilken doesn’t go all scorched earth on the NCAA. It’s almost like watching a sword fight where one fighter is beaten, lost his sword, driven to the ground with the blade against his neck, only to see his opponent pull away and reach out his hand to lift him off the ground. Partly that’s due to the relief the plaintiffs sought. I also suspect Wilken, like most cautious trial judges, sought to fashion a ruling that would be hard to challenge on appeal (although we shouldn’t underestimate Donald Remy on that front quite yet). In any event, she’s given the schools something to work with, if they so choose, that won’t break the bank.
First of all, start with the core of her order.
… Wilken issued an injunction that will prevent the NCAA “from enforcing any rules or bylaws that would prohibit its member schools and conferences from offering their FBS football or Division I basketball recruits a limited share of the revenues generated from the use of their names, images and likenesses in addition to a full grant-in-aid.” Wilken said the injunction will not prevent the NCAA from implementing rules capping the amount of money that may be paid to college athletes while they are enrolled in school, but the NCAA will not be allowed to set the cap below the cost of attendance.
No more cartel. What does that leave for the schools?
First, the NCAA could permit FBS football and Division I basketball schools to award stipends to student-athletes up to the full cost of attendance, as that term is defined in the NCAA’s bylaws, to make up for any shortfall in its grants-in-aid. Second, the NCAA could permit its schools to hold in trust limited and equal shares of its licensing revenue to be distributed to its student-athletes after they leave college or their eligibility expires. The NCAA could also prohibit schools from funding the stipends or payments held in trust with anything other than revenue generated from the use of the student-athletes’ own names, images, and likenesses.
As much as Jim Delany might snarl otherwise, that’s an affordable solution for the schools. As Mandel puts it,
And in fact, if Wilken’s ruling stands as the lone business change going forward (provided it’s not overturned on appeal), then most major athletic departments would barely feel the brunt. It’s basically a tax. Most SEC teams spend more per year on their defensive coordinator.
Is it sensible to fight that? As one of the plaintiffs’ attorneys put it,
“What are they going to appeal?” Hausfeld said. “This is what at least the major conferences professed they want to do (pay players cost of attendance) and they can’t because of the cartel. The judge just said not only am I letting you five do it, I’m telling everybody it’s an open field. You’ve got no cover not to do this.”
And that gets us to the end game. Let’s get the obligatory Remy quote out of the way first:
Donald Remy, the N.C.A.A.’s chief legal officer, issued a statement saying he disagreed with the ruling. The N.C.A.A. is expected to appeal the decision.
“We note that the court’s decision sets limits on compensation, but are reviewing the full decision and will provide further comment later,” Remy said. “The N.C.A.A. is committed to fully supporting student-athletes.”
Wilken’s ruling kicks in July 1, 2016, so the NCAA has plenty of time to fight in the courts, or to seek Congressional aid to overturn the ruling, if it so desires. Given that it turned down opportunities to fashion a settlement, despite obvious hints that the litigation wasn’t likely to go its way, it seems likely that the fight will go on, at least for a while. And no doubt there are peripheral issues, like Title IX, to be thrashed out. But what the NCAA has to be most concerned about is the next case.
The real significance in Wilken’s ruling might be in where it could lead. Wilken is scheduled to hear another batch of antitrust cases against the NCAA. Where O’Bannon dealt with rights to names, images and likenesses, these deal with more direct compensation, seeking to prevent the NCAA from setting limits on the value of a scholarship. In each case, the plaintiffs will draw from Wilken’s ruling in O’Bannon to try to help make their arguments.
It’s possible Wilken ruled narrowly in this case while recognizing the pending cases strike more directly at the heart of the collegiate model. It’s not that Wilken will necessarily rule against the NCAA in those cases — though she certainly might — but that she’ll have the opportunity to more fully explore the issues in those cases.
The O’Bannon ruling’s significance might not be fully known for several years — and that has nothing to do with the inevitable appeals, and everything to do with those other cases. There’s no way to predict what happens from here.
O’Bannon is now a road map for antitrust lawyers. Jeffrey Kessler knows where he has to go now; the NCAA’s lawyers know, too. More importantly for the latter, they also know that they’re going to have to find more credible support for the position their client takes. Mandel, once more:
But don’t kid yourself. Friday’s ruling only opened the door for years and years of more lawsuits and perhaps even Congressional rulings. Wilken’s strong words in deflating the amateurism model will become the template for thirsty lawyers smelling further NCAA blood – like Jeffrey Kessler, the prominent labor lawyer who filed a claim last March against the NCAA and the Power 5 conferences seeking to lift college athlete compensation restriction entirely.
No one can possibly predict where this will all wind up. All we know is that on August 8, 2014, a federal judge in California sized up the testimony of NCAA President Mark Emmert, Big Ten commissioner Jim Delany and other prominent administrators called to defend college sports’ amateurism model and said — I’m not buying it.
How much is that likely to change? I have my doubts that somebody like Steve Patterson is ready to embrace a new model, even if, ironically, he’s one of those in an easy position to afford to do so. But I’m also skeptical that the schools are going to find the road to an antitrust exemption easy to navigate. Which should mean the signs point one way.
“The NCAA will hopefully never be the same,” Hausfeld said. “It’s going to go through a metamorphosis and if it approaches it wisely, it should sit down and discuss with all the interested entities how best to form a new way going forward.”
I don’t think the NCAA is there yet. More smack downs to come.
49 responses to “Judge Wilken splits the baby.”
It’s not over until the appeals are over.
I appreciate how you are staying on top of this issue. You are doing what very few have the fortitude to do.
I guess between this, the autonomy vote and the union issue, Nick Saban is about to raise my ticket prices.
Have a good day,
About the union issue – I wonder if the schools appreciate the one gift Wilken gave them in her ruling. The NCAA can set a ceiling on compensation in the absence of a labor agreement. Not even the NFL has that. That’s not a bad carrot to offer to avoid appeals. But, then again, this is the NCAA we’re talking about.
Since the NLRB ruling eliminated all but private schools, in your opinion then, if say, Georgia, allows a “student athlete action committee” that would function to represent student athlete interests and would be a union in everything but name or operational guidelines, could/would, again, in your opinion, the state allow such a thing?
I was about to write the same thing BD. The Senator has worked hard to make this simple for us blockheads to understand. If you listen to sports talk radio, the talking heads don’t even know where to start and seemingly are too lazy to try to understand this complex issue. They would do themselves a service to read this blog.
I skimmed the decision since I’m not a lawyer but I did stay in a Holiday Inn Express last night. I thought the decision was right on except I thought she would step out and allow athletes to market their own NILs. The Power 5 have the ability to go out now and do exactly what they should do: Fund full cost of attendance scholarships. Kessler is the one I look at with a wary eye and question his true motivation: Is he a crusader looking out for the student-athlete or a shark that smells blood in the water and wants his before everyone else?
Awesome post. I knew I could count on our good Senator to summarize the aftermath in a way I’d actually want to read.
+1 – well done as usual on this, Senator
Yes, same here. I really appreciate you making this easier to understand.
Also, if I were Chris Conley I’d be investigating more opportunities to get involved in student representation in the NCAA’s upcoming effort to re-set the table. Make a national name for yourself, Mr. Conley.
How does this ruling affect the bag men?
At this time, not a darn thing. Even in a pay-for-play scenario, the bagmen will be out spreading cash around under the table away from the watchful eye of the schools and the IRS. These guys are the true scum of college sports regardless of which side of the pay-for-play debate you’re on.
there is no system containing limitations of any sort on payments to players that a place like Auburn can’t circumvent.
That’s exactly right and the reason none of this is going to work. If the NCAA simplified the rules and stiffened the penalties for violations, that would be the only way to bring rogue programs into line.
Yeah, there will always be a way. They will always find it.
Thanks Senator, Read through some of it last night after the Braves went Rain Delay. Appreciate the Keynotes.
Having both an MBA (Finance) and a Law Degree from UGA – am sincerely amazed by the NCAA’s intractable positions on nearly every ridiculous front. The amount of churn alone is nigh indefensible as that money is coming out of profits from withheld NILs revenue over the years. This keeps up and punishment damages could also be slapped on the NCAA.
The Ivory Tower Presidents who appoint Mark Emmert should be ashamed.
(Thus the choice of a Gravatar lo these many years.)
Do we have the vision on campus now to be a first mover on the comp piece? In theory, we could be a first mover on offering scholarships adjusted for total cost.
Probably not. And in this case that’s probably not a bad thing as no one knows where this is going and the law of unintended consequences is so heavily in play here.
What might be potentially interesting would be if the NCAA decided to get out of the compensation business altogether and leave setting limits up to each individual conference.
But I suspect the Kessler litigation will be the real game changer in that area, if the schools are stupid enough to let it get that far.
Kessler has made it clear that he wants nothing short of pure pay-for-play. Maybe it’s a negotiating position from an attorney who thinks he’s holding 4 aces, but he has not indicated any willingness to discuss something less than that unless he has said something recently. He mentioned the items Judge Wilken has now approved with her decision aren’t good enough.
Kessler is not looking for a settlement check he wants to level the NCAA. He has the background, wealth and influence to pull it off.
Oh, I know he wants a scalp and nothing less than the complete obliteration of the NCAA and the college sports model will seem to satisfy him. Since most agents are attorneys by trade and education, I wonder if the agents are really who are behind this whole thing. College sports has been a big business for a long time with a lot of money, but no one has really gone after the business model until now.
Agree. That billion dollar pie is gonna get cut up and the NCAA portion is going to get smaller. Electronic Arts and the Collegiate Licensing Company agreed to pay $40 million to be removed from the claim. These guys were the smart guys and their attorneys earned their $.
Does this mean that players can sell their jerseys now?
Sorry, AJ, no can do. At least not on the books. 😉
A. J.; if you must – Use the Manziel Model for Maximum Plausible Deniability
Even better for the NCAA. She herself set a cap. While she set a floor, which is rage actual cost of attendance, she allows but not requires schools to provide into a trust an amount over the actual cost of attendance no more than $5,000 per year as calculated in 2014 dollars!
I thought it was a an excellent example of a thoughtful judge fashioning an order permitting both sides to end the controversy with something each could claim as a victory.
She also ordered that the order is not stayed if either side appeals. That means the side appealing would have to ask the 10th circuit court of appeals for a stay and that is a much bigger hurdle. Thus, if the circuit court does not stay it the parties will have a year or s
Two actual experience with the injunction and both may find it is something they can live with.
I thought it was an excellent judicial product.
This was supposed to be in response to the Senator’s august 9, 2014 at 9:34 am post above. Sorry.
So Auburn coaches can now add a “marketing agreement” to their LOI documents stipulating that a recruit will be guaranteed a certain number of paid endorsements for $X,XXX,XXX.XX dollars? But Bama’s will counter with more?
No. Auburn and every other school must offer a share of the players’ group images, names and likenesses licensing revenue up to an amount supplementing the grant in aid to the actual cost of attendance. The NCAA cannot prevent Auburn or any other FBS or D-1 basketball school from offering all scholarshipped football and basketball players a share of the licensing up to $5,000.00 per year the player is in school payable into a trust. The player cannot access the funds until graduates.
Auburn and Alabama can choose to tell recruits it pays nothing into the trust or it pays any amount it chooses into the trust up to $5,000 per year. You have 3 too many Xs in your question.
Nice analysis including your observations above.
Thanks, Senator. A very good read. I appreciate the time and effort you put into composing this for those of us who often chose the Cliff Notes over the actual book.
You’d think we’d have to pay subscription fees for content like this, huh? The guy amazes me, he really does.
+1 – the stuff the Senator writes is better than the drivel on the pay sites
When Mark Emmert woke up this morning from unsettling dreams, he found himself changed in his bed into a giant palmetto bug
A) Players deserve a cut and an annual salary/stipend. B) That money should be held in escrow until the player earns his degree. C) Upon collection, expenses, tuition, books, room, board, and facility and equipment usage fees should be subtracted from the escrow amount. D) Players who make an icon out of their number, image, name, etc. would get a small royalty fee for as long as the bookstore sells their journey.
Most guys would break even. The school would still make millions.
Why so? Any other student on scholarship with a paying job wouldn’t have that offset.
You offer “break even” like it’s some kind of good deal for the kids.
The NCAA is only fulfilling the role of the good bureaucrats,defending the Status Quo. They will continue until the real power (the college presidents) decide to call them off. The ruling which I read does seem to be the old carrot and stick. The judge has bent over backwards to give the NCAA an easy way to settle this. I guess the college presidents don’t mind looking so stupid. Congress will not ride to the rescue on this, it gores too many special interest groups.
How is her ruling allowing the NCAA to set a cap (albeit a slightly higher amount) any different than what the NCAA was already doing?
Because the NCAA can no longer dictate that student-athletes receive no compensation at all for their NILs.
First, the current cap on what the grant in aid can provide is tuition, room, books, meals, and specific unique supplies for classes. I guess that means thing such as drafting tables and equipment that are not the common notebooks and pens. The actual cost of attendance is an amount each NCAA member calculates and includes not only the items permitted in the grant in aide but also other necessary expenses a college student faces. Those other expenses include the transportation costs to and from home, and normal living expenses such as soap, toothpaste, laundry, and a little spending money. The difference between the costs covered by the grant in aide and the actual cost of attendance vary greatly from institution to institution depending upon such things as the cost of living in the university’s community. The ruling says that the schools are required to use that portion of the licensing revenue they receive to supplement the scholarships to cover the school’s actual cost of attendance. That is a change the big five conferences actually proposed and the full Division rejected.
Second, the NCAA currently prohibited athletes from receiving anything more than $0.00 for their names, likenesses and images. The ruling removes that prohibition. The ruling allows, but not requires, schools to provide, in excess of the actual cost of attendance, payments up to but no greater than $5,000 per year into a trust for the athlete.
Third, The NCAA cannot set a uniform amount payable into the trust fund. The colleges can elect how much to pay. Under current system the NCAA would determine a uniform amount provided to athletes for any purpose. The premise of your question was that her ruling lets the NCAA set a cap. The ruling does the opposite. It prohibits the NCAA from capping payments at a level below $5,000 per year.
I get both of ya’ll’s points, I really do. The point I was getting at, and our comments may be just splitting hairs, but I think we’re going to eventually end up with an employee/employer relation because we all know the NCAA is going to screw this favorable ruling up somehow. It just appears to me that all they’ve done is increase the cap on compensation without a labor agreement in place, which seems to be price fixing and therefore illegal (I’m not a lawyer, I just play one on television, mind you). I get that $5K is > $0, but it just reeks of price fixing at the end of the day. Who is to say that every school won’t just decide “oh, full cost of attendance is $5K”, even if it’s closer to $10K at some schools? I think the NCAA got a sweetheart deal, but I just can’t imagine they aren’t going to fight this thing to the point where they end up in a worse position. You know, because… Mark Emmert and Donald Remy.
Wilken accepted the argument presented at trial that at some level, paying players would affect public perception of college sports and negatively impact demand. But she didn’t agree that any payment would do so. She split the baby.
This is the big thing I was referring to when I described O’Bannon as a roadmap. Wilken has outlined for Kessler what he’ll need to show to win his case.
Thanks for clarification. I appreciate all the work you’ve done on this over the past couple of years calling it way ahead of time of how big this was going to be. It seems like the bar Kessler is going to have to clear is going to be mighty low at this point.
There’s a part of me that is sad that college football will effectively become pro sports, but then there’s the part of me that acknowledges it really was the guys in charge that killed the golden goose. I definitely have shared your “I’d be surprised if I give a shit about college football in five years” sentiment for awhile now and it has nothing to do with O’Bannon or Kessler.
Sorry, Audit, I didn’t interpret your question correctly. This case does not address compensation for players’ labor. It is narrowly limited to intellectual property interests. Judge Wilkens was careful to not get into labor issues. She correctly left that issue to be decided in the next case.
Care to guess why she capped the NIL share at $5000? Could she have not voided the schools rights to own an athletes NIL, or was she limited to addressing the NCAA’s enforcement rights? Put more simplistically, why can’t Todd Gurley go make an add for a local Athens business and be paid? I’m guessing it’s because this suit was about the broader licensing rights negotiated by the NCAA and nothing more so she couldn’t go there?
I can answer those questions but I am riding and on my android. I will respond when I am at my desktop.
Audit, I do not want to be pedantic so please forgive me if I am.
To accurately answer I have to explain the issues.
The Judge properly kept her ruling confined to the claims actually raised in the case. The issue of Todd Gurley selling his individual rights to his name. image and likeness was not a claim raised by the plaintiffs against the NCAA. Therefore, the Judge did not address whether the NCAA’s prohibition against Gurley marketing his name, image and likeness violates the Sherman Antitrust Act and the Judge made no ruling about it. That NCAA rule still stands unaffected by the O’Bannnon case.
The plaintiffs’ claims were that the NCAA not allowing the players as a group to be paid for the commercial use of their group name, image and likeness rights violated the Sherman Antitrust Act. The plaintiffs did not seek money damages for any violation of the Act and instead requested an injunction against further violations.
As a threshold the Judge had to decide whether the players as a group had name, image and likeness rights that had value. The players said, “yes.” The NCAA said , “no, the players’ group name, image and likeness rights has a value of zero dollars.” The Judge found from the evidence that the players’ group name, image and likeness rights have market value and that the NCAA, conferences and schools have sold those rights in the past. The CBS, ESPN, and Fox broadcast contracts purchase, among other things, license to use the players’ group name, image and likeness rights.
Next the Judge had to decide what commercial markets are implicated by those rights. If there is no relevant market for those rights then the price fixing by the NCAA of zero for the value of those rights does not violate the Sherman Act. If there is a relevant commercial market then the antitrust analysis continues. The Judge concluded that there are more than one relevant market. Interestingly, the Judge concluded that the markets in which the rights are sold include two markets in which schools and players are involved. One market is where the schools are buyers and the players are sellers. The schools, during recruiting, sell prospects on the educational benefits of the school, the athletic development and training provided by the school, and the future marketing benefits from the school (a successful player at Georgia or Alabama gets greater publicity than a player at Tulsa so when he becomes a pro his endorsement value is higher.) The recruit is the buyer of the school’s services,and the currencies passing from the player to the school are the athlete’s physical talent and activity and the athlete’s consent to the school being able to sell his name, image and likeness rights as part of the group rights sold to the broadcasters. Another market is the players selling their services and name, image and likeness rights to the schools and the currency the school is using is the grant in aid.
The next issue is whether the NCAA instituted rules that affected the price the players paid for the schools’ services and the price the school paid for the players’ efforts and name, image and likeness rights. The Judge found that the NCAA set a value of zero dollars for the rights and prevented the schools as both buyers and sellers from attaching any value except zero dollars. Thus, a restraint of trade.
One significant harm to the players is that the players cannot receive more than the grant in aid, and there is no dispute that the grant in aid does not cover the actual cost of attendance at any FBS football or D-1 basketball school. The Judge noted the testimony during trial that the power conference schools had tried to change the rule to permit schools providing the actual cost of attendance.
Once the plaintiffs established that the defendant did restrain trade as to the value of the rights then the burden shifted to the defendant to show that the restraint is a reasonable restraint. There are certain restraints that actually have a pro-competitive effect on the relevant market. The NCAA put forth a number of claims as to why the prohibition on paying the players for the group name, image and likeness licenses was either pro-competitive or reasonable to the purpose of the endeavor.
The NCAA’s witnesses contended that polling showed the consumers, that is, you and I and other fans, would be less likely to consume the college football product if the players were paid as professionals. The NCAA also had witnesses testify that an academic environment, including athletes being fully integrated into the student population, is essential to serving the educational purpose of the players being college students. Those witnesses said that if players got six figure incomes from their share of group licenses they would be less likely to be fully integrated into the student population and their educational experience would be negatively affected.
The Judge considered evidence in the record that the NCAA allowed scholarship athletes to get a modest cash stipend from 1956 through 1974. The Judge also considered evidence that the power conference schools already had proposed cash payments of a few thousand dollars to supplement the grants in aid. The Judge also noted evidence in the record that for the past several years the NCAA had allowed tennis players to earn up to $10,000.00 in tennis prize money before accepting a scholarship and remain eligible to compete in NCAA tennis. Just as important, the NCAA’s own expert witness as to the effect of payments upon the integration of athletes into the student environment conceded that the there would not be a negative effect if the players were to receive a few thousand dollars rather than six figures.
The Judge was persuaded that the NCAA’s interest in preserving college football and basketball as a college student when selling to the consuming public is a reasonable interest but that the public would not be turned off if the players received a few thousand dollars paid into a trust fund rather than six figures. The Judge was persuaded that the player’s integration into the educational environment would not be affected if the players received a few thousand dollars paid into a trust fund.
Thus, the Judge found that the least restrictive restraint that served those reasonable interests of the NCAA was consistent with the NCAA’s witnesses dollar ranges, payments to FBS football players and D-1 basketball players for their share of name. image and likeness rights in amounts sufficient to supplement the grants in aid to the actual cost o0f attendance. The Judge found that the NCAA could restrain the FBS football and/or D-1 basketball schools from paying more than $5,000.00 per athlete (in excess of the actual cost of attendance) so as to accommodate the goal of keeping fans happy that the game is a student, not pro, game and to further the goal of keeping rich players separating themselves from the academic environment. The Judge concluded that prohibiting schools from offering anything between $0.00 and $5,000.00 per year paid into a trust fund did not further those goals and therefore would violate the Sherman Act.
Why $5,000.00 per year into a trust as opposed to $4,000.00 per year or $6,000.00 per year? I guess she had to draw the line at some reasonable amount and I guess it just seemed to be a good number.
The case was not about any monetary amount for name, likeness or image rights that college scholarshipppd tennis player, gymnasts, cross country runners,or golfers may have. The plaintiffs were football and basketball players and the Judge decided only the issues on the table. If the schools sell to broadcasters license to cross country runners names, likenesses and images then those athletes and the NCAA have stuff to talk about.
As I said before the plaintiffs elected to not make individual rights an issue so the Judge made no ruling on that matter and the NCAA is not enjoined from enforcing those rules.
I hope I properly understood your question, I hope I have not ben pedantic and I hope this makes sense.
Great write-up and thanks for taking time to respond.