Judge Leans Toward|NCAA in Antitrust Case

OAKLAND, Calif. (CN) — Though indicating she would dismiss an antitrust class action challenging the NCAA’s cap on scholarship money, a federal judge Tuesday gave college athletes time to file an amended complaint clarifying the type of injunctive relief they seek.
     Though U.S. District Judge Claudia Wilken refrained from ruling until the plaintiffs file an amended complaint, she said she would likely rule in favor of the NCAA based on case law.
     Wilken in December certified three classes of athletes who challenged NCAA rules capping scholarships at the cost of attendance, “untethered” to educational expenses.
     The plaintiffs say the NCAA and its conferences violate federal antitrust law by imposing the cap and that schools would offer more generous scholarships to attract players without it.
     The NCAA sought dismissal, saying the claims are identical to those litigated in O’Bannon v. NCAA, in which the Ninth Circuit held in September 2015 that member schools need not compensate athletes above the cost of attendance.
     Wilken agreed.
     “It was tried and it’s the law,” she said at oral argument on Tuesday. “If I were to rule as I think I probably will have to, an injunction couldn’t include payment higher than the cost of attendance untethered to educational expenses.”
     Addressing the plaintiffs, Wilken asked: “The question is, does that leave anything of your injunctive relief case? I tend to think it does, but not money untethered to the cost of attendance.”
     Under the cap, Division I college football and basketball players may receive assistance only for tuition, institutional fees, room and board and books.
     The plaintiffs say the cap unfairly bars them from earning money playing sports, from which the NCAA receives multibillion-dollar payments from TV networks and advertisers.
     Plaintiffs’ counsel Jeffrey Kessler told Wilken that the injunctive relief the plaintiffs seek includes awards that would exceed the cost of attendance but would go toward education-related expenses, such as tuition for graduate school. So even if the court upholds the scholarship cap based on O’Bannon, the plaintiffs will still have a case, he said.
     “As long as you provide for [compensation] tethered to educational objectives, it will not dispose our case,” Kessler said.
     NCAA attorney Jeffrey Mishkin criticized that as “micromanaging” in an area where the Ninth Circuit had given the NCAA flexibility.
     “This isn’t about small issues of what is and isn’t an appropriate educational expense,” Mishkin said. “These small incremental issues are not for an antitrust court to decide.”
     The students and former students say their case is solid because their claims differ from those in O’Bannon.
     In O’Bannon, they say, the court considered NCAA rules prohibiting compensation to college athletes for licensing their names and images — not its rules governing scholarship caps. They call the two lawsuits “different litigation involving different claims, with different plaintiffs seeking different relief.”
     The NCAA denies it. It claims that O’Bannon considered NCAA rules capping any form of payment to college athletes, not just its rules on licensing.
     “The fact that one case is about name and image licensing and the other is about pay-to-play is a distinction, but the antitrust claims are exactly the same, ” Mishkin said.
     The students said in a memorandum that the NCAA request for dismissal is simply a ruse to buy time, and that it would have made the motion shortly after O’Bannon was decided if it believed it barred scholarship awards above the cost of attendance.
     “One can only conclude that this exercise is an effort by defendants to inflict delay on this case while they pursue Supreme Court review to reverse – not affirm – O’Bannon,” the students said in a June 1 memorandum in response to the NCAA motion for judgment on the pleadings.
     Kessler is with Winston & Strawn; Mishkin with Skadden, Arps, Slate, Meagher & Flom, both of New York.

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