Southpaw 27: Full Court Press
The NCAA goes to the Supreme Court.
Dear Readers,
Welcome to the second edition of Southpaw-in-Brief, the slightly abridged format we’ve adopted while the two of us work on some cool side projects (which we will share with all of you when the time is right!). We’re trying to keep things on the shorter-side these days, but with the Supreme Court set to hear oral arguments in a critical legal challenge to the NCAA’s amateurism model this week, we couldn’t help ourselves.
Thanks for indulging us, and get your popcorn ready for Wednesday!
-Calder & Ian
The Supreme Court asks: Does the NCAA have to play by the same rules?
With March Madness well under way, public attention will briefly turn from the harcourt to the High Court on Wednesday as the Supreme Court hears oral arguments in National Collegiate Athletic Association v. Alston.
The case is a consolidation of two separate lawsuits brought by former NCAA Division I football and basketball players, both male and female, against the league and its subsidiaries. In the consolidated suit, the athletes have argued that the NCAA’s limits on “non-cash, education-related benefits” for athletes—things like laptops, paid internships, and other academic materials—violate federal antitrust law. In May of 2020, the Ninth Circuit ruled in the players’ favor, arguing specifically that the NCAA’s compensation rules violated Section I of the Sherman Antitrust Act of 1890. In his concurring opinion to the majority’s ruling, Judge Milan Smith affirmed what every sane and reasonable sports fan already knows about the NCAA: that “[t]he treatment of Student-Athletes is not the result of free market competition” and instead “is the result of a cartel of buyers acting in concert to artificially depress the price that sellers could otherwise receive for their services.” Being neither sane nor reasonable, the NCAA disagreed, and the league immediately appealed the Ninth Circuit’s decision to the Supreme Court, who granted certiorari last December.
Given the expansive public debate about the NCAA’s treatment of its players—including whether athletes should earn a portion of the league’s revenue—the question currently before the Court might seem like a kind of academic issue. But in reality, the Court’s decision could have major implications for the future of the NCAA and its business model.
Although the narrow question before the Court has to do with the legality of the NCAA’s limits on the non-cash benefits, the suit raises broader legal questions about the NCAA’s amateurism model. In particular, Alston will give the Court an opportunity to reexamine its ruling in the most consequential NCAA-related decision to date, from the 1984 case NCAA v. Board of Regents of the University of Oklahoma. In that case, which nominally pertained to the NCAA’s ability to decide which television networks were able to broadcast its games, the justices ruled 7-2 that, because of the essentially collusive nature of sports leagues, the Court should employ a less stringent legal standard (called “rule of reason”) when evaluating antitrust claims against sports leagues, rather than the higher standard (“per se rule”) that it uses to evaluate antitrust claims in most other cases. The logic behind this decision is pretty clear: sports leagues like the NCAA have to engage in a certain amount of pro-competitive collusive activity in order to function as a league, so the courts should grant them some leeway that they might not grant to, say, an oil company or consumer-products manufacturer.
In Alston, though, the NCAA is arguing that this lower standard gives the league more or less complete latitude to define the nature of its product—i.e. “amateur athletics”—which the NCAA has argued is actually pro-competitive, since the amateurism model supposedly distinguishes college sports from professional sports. By this legal logic, the league’s refusal to compensate its players should be completely immune from antitrust scrutiny, since the rule of reason standard should give the league latitude to protect “amateurism” as a core element of its product.
The Supreme Court has been sympathetic to the NCAA’s amateurism argument in the past, but its willingness to hear the Alston case suggests that the justices are ready to look at the question anew. Just a few years ago, in 2016, the Court declined to hear a challenge to the Regents ruling in O’Bannon v. NCAA (another antitrust suit that challenged the NCAA’s use of images of former athletes for commercial purposes), which both O’Bannon and the NCAA asked the High Court to hear after the Ninth Circuit—yes, the same Ninth Circuit that ruled against the NCAA in Alston—ruled in favor of O’Bannon. In their decision in that case, the majority cited Board of Regents only to limit the scope of that case, arguing that “we are not bound by Board of Regents to conclude that every NCAA rule that somehow relates to amateurism is automatically valid.” (For their own part, O’Bannon’s lawyers appealed because they wanted SCOTUS to decide that “preserving amateurism” was not a valid interest in the first place and that the amateurism model shouldn’t afford the NCAA greater legal leeway under antitrust law.)
SCOTUS’s decision in Alston will in large part hinge on how the justices apply the Board of Regents ruling to this new set of case facts. (Interestingly, the U.S. Department of Justice—the government entity tasked with enforcing antitrust law—has decided to weigh in in support of the Ninth Circuit’s decision, and the Court decided to give the U.S. Solicitor General ten minutes to present the government’s case during oral arguments.) Depending on how the chips fall, though, SCOTUS’s decision could effectively cement the NCAA’s exemption from standard antitrust regulations—thereby placing even more pressure on Congress to take legislative action to protect college athletes’ economic rights—or open the gateway for a torrent of similar antitrust lawsuits aimed at other aspects of the NCAA’s business model. In short, the Court’s decision could be disastrous for college athletes, or it could very quickly change their lives for the better. And don’t just take our word about it. In its written response to the Ninth Circuit’s ruling in Alston, the NCAA claimed that the court’s reasoning would “fundamentally transform the century-old institution of NCAA sports, blurring the traditional line between college and professional athletes.”
The NCAA has accomplished “blurring the line between college and professional athletes” pretty much all by itself. As for the Court’s ability to “fundamentally transform” the institution of the NCAA—boy, we hope it will.
GO DEEPER:
A bunch of legal minds much brighter than the two of us have been paying close attention to Alston—for what it’s worth, Ian came very close to dropping out of undergraduate ConLaw—so we’ve compiled a brief list of suggested readings to help you brush up on your antitrust jurisprudence before Wednesday.
“Courts to take on student-athlete compensation, class action cases,” by Amy Howe for SCOTUSBlog (Dec. 16, 2020).
“The Supreme Court showdown over whether colleges should pay their athletes, explained,” by Ian Millheiser for Vox (March 26, 2021).
“Exploring the NCAA’s Antitrust Arguments Ahead of Oral Arguments in NCAA vs. Alston,” by Eli Nachmany in Harvard Journal of Sports and Entertainment Law (January 2, 2021).
“Seven Cases that Shaped Sports Since 1977,” by John Wolohan and Gao Fei in Athletic Business (April 2017).
“March Madness Is Back. And It's Going To The Supreme Court Too,” by Sean Gregory in Time (March 17, 2021).
RODNEY’S ROUNDUP:
Do you want to read about . . .
. . . the hypocrisy of the lawmakers targeting transgendered athletes? “So You Want to ‘Save Women’s Sports?’” by Lindsay Crouse in The New York Times (arch 24, 2021).
. . . the MLB Players’ Association putting pressure on Georgia in the wake of new voting restrictions? “MLBPA chief open to talk with MLB about moving All-Star Game out of Georgia following new voting laws,” by RJ Anderson for CBS Sports (March 26, 2021).
. . . Megan Rapinoe’s trip to the White House? “At White House, Megan Rapinoe says she’s been ‘disrespected and dismissed because I am a woman,’” by Des Bieler and Cindy Boren in The Washington Post (March 24, 2021).