Fight Over Class Status in NCAA Case Heats Up


     (CN) – The NCAA fought back against class action claims that it cheated student-athletes out of their right to profit from their own images in video games and other materials.
     Former UCLA basketball star Edward O’Bannon led the charge against the National Collegiate Athletic Association with a 2009 class action that claimed the he and other students were forced into signing the misleading Form 08-3a if they wanted to play.
     The form “commercially exploits former student athletes” by giving the NCAA the right to profit from their images without compensation, long after the athletes have left school, according to the complaint.
     Athletes say the defendants violated federal antitrust laws and conspired to restrain trade by fixing their compensation at $0.
     U.S. District Judge Claudia Wilken in Oakland, Calif., faces a motion to certify two classes. The declaratory- and injunctive-relief class consists of NCAA basketball or football players who say their images were used after they stopped playing college sports. The antitrust damages class consists of athletes whose images have been licensed or sold.
     That latter group wants the NCAA to disclose revenue data from its members to calculate what they are owed. But the NCAA claims that the information is privileged and not relevant.
     Meanwhile the NCAA and its co-defendants, Electronic Arts and the Collegiate Licensing Company, say Wilken should strike the motion for class certification because the athletes are advancing new theories that were never contemplated in the complaint.
     The defendants say the case has always been about the NCAA’s alleged “perpetual release” forms that “eliminate” former athletes’ ability to license materials.
     “Now, at the 11th hour, plaintiffs have made a 180-degree turn: they have dropped their ‘perpetual release’ case and suddenly switched to a case in which NCAA bylaws prohibiting pay for play supposedly create a ‘horizontal labor restraint’ on current student-athletes related to the live broadcasts of games,” according to the brief filed by NCAA attorney Robert Wierenga of Schiff Hardin (emphasis in original).
     “Having realized that their old case was wrong on the facts, plaintiffs now assert different, unpled claims that are wrong on the law.”
     The motion is also signed by Electronic Arts attorney R. James Slaughter of Keker and Van Nest, as well as Collegiate Licensing Co. attorney Peter Boyle of Kilpatrick, Townsend & Stockton.
     The defendants said they have not had an opportunity to contest the athletes’ new theory, which is supposedly backed by “new evidence.”
     “Plaintiffs have failed – indeed, they have not even really tried – to demonstrate how their so-called ‘new evidence’ justifies their attempt to assert a new ‘labor restraint’ theory in the CCM,” the brief states, abbreviating class certification motion. “Nor could they plausibly do so. The CCM’s new theory is simple: plaintiffs now claim that NCAA amateurism and eligibility rules allegedly violate the Sherman Act by preventing current student-athletes from selling their ‘athletic labor’ to NCAA schools in exchange for 50% of live broadcast revenues. But there is nothing secret – or new – about the NCAA’s rules relating to amateurism and eligibility.”
     A student-athlete who was paid for appearing in a live broadcast risked his eligibility to participate, and the plaintiffs have known that since early 2011, the brief states.
     Because the court relied on “inconsistent statements” by the plaintiffs, Judge Wilkens should strike the motion for class certification, the defendants argued.
     The athletes meanwhile reiterated their arguments for class certification on Tuesday, virtually duplicating the motion they filed in September.
     Trying to show that college sports “have become big businesses,” the new motion cites a dissenting opinion in a 7th Circuit case from 1993 involving NCAA contracts.
     Judge Joel Flaum wrote at the time: “Despite the nonprofit status of NCAA member schools, the transactions those schools make with premier athletes – full scholarships in exchange for athletic services – are not noncommercial, since schools can make millions of dollars as a result of these transactions. Indeed, this is likely one reason that some schools are willing to pay their football coaches up to $5 million a year rather than invest that money into educational resources.”
     Hausfeld attorney Michael Lehmann says in the brief that the NCAA could have compensated athletes in other ways “such as withholding payment until after graduation or paying student-athletes compensation in the form of increased living costs.”
     Judge Wilken is scheduled to decide the class certification motion on March 7, 2013.

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