Student-Athletes Fight Faces Uphill Battle in California

SAN FRANCISCO (CN) — An attorney for a former USC linebacker struggled Thursday to argue before a federal judge that the National Collegiate Athletic Association has an employment relationship with student athletes.

The NCAA is fighting to dismiss a proposed class action filed last year by Lamar Dawson, who played for the University of Southern California from 2011 to 2015.

Dawson’s attorney Mark Rifkin argued at a hearing Thursday the NCAA and Pac-12 Conference impose rules and requirements on student athletes that dictate practice hours, conduct and academic performance.

 

“Any student athlete who is a participant in a scholarship program in a revenue-generating sport is unquestionably an employee,” Rifkin said.

He distinguished Dawson’s case from a similar class action recently shot down by the Seventh Circuit, in which University of Pennsylvania track and field athletes Gillian Berger and Taylor Hennig claimed they had the right to be paid under the Fair Labor Standards Act.

Rifkin said Dawson’s case is different, as the NCAA and Pac-12 reap huge profits from football.

U.S. District Judge Richard Seeborg said he couldn’t see how that made them employers.

“I don’t see any indication that the revenue generation of the entity is the determining factor as to whether or not you’re an employee,” Seeborg said.

Rifkin said Seeborg should look to an antitrust class action brought by former UCLA basketball player Edward O’Bannon, in which the Ninth Circuit upheld U.S. District Judge Claudia Wilken’s 2014 ruling that the NCAA violated antitrust laws by barring payments to student athletes under its amateurism rules.

Rifkin said the O’Bannon decision defines the quintessential employment relationship as one in which labor is exchanged for in-kind compensation.

In the case of student athletes, compensation would be scholarships and a chance to turn professional.

“In O’Bannon, the NCAA is acting from an antitrust perspective in a posture where they are controlling the operation of the market. It’s a little different here. You’re trying to bootstrap them into the employer position,” Seeborg said.

Returning to the issue of control, Rifkin said the same reasoning the Ninth Circuit applied under the Sherman Antitrust Act could apply to the Fair Labor Standards Act.

“It’s the same relationship but is subject to a different statutory scheme. It’s really that simple,” Rifkin said. “I agree that O’Bannon was not a case that decided the question of employee status under the FLSA, but their recognition of that exchange was an essential part of that court’s analysis of the antitrust issue.”

He added: “There is a no-pay rule that comes from the top. That is a hallmark of control. It’s the power of the purse. And no entity exercises greater power over the purse than the NCAA over this case, because they say zero.”

Seeborg asked NCAA attorney Steven Katz how Dawson’s case differed from Berger.

“Here we are in a different situation because we have a very lucrative aspect in this instance with USC: Division One, bowl-eligible football,” Seeborg said. “A great deal of money could be involved. Why shouldn’t I take that into account here when I look at this question, because it is the economic reality, that there’s a lot of money in college football.”

Responding bluntly, Katz said: “Because it’s simply irrelevant. The dollars generated does not define the economic reality.”

Katz said all student athletes should be looked at on equal terms, since fundamentally they are in college to be students first, athletes second.

The O’Bannon case, Katz said, is likewise irrelevant. Though the Ninth Circuit ruling talks about an exchange of labor for compensation, the plaintiffs in that class were bringing different claims.

“Yes, those words are in an antitrust decision. They simply have no relationship to the FLSA,” he said. “It’s apples and oranges.”

Seeborg took the case under submission.

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