NCAA Stumbles on Road to Antitrust Trial

     SAN FRANCISCO (CN) – As a June antitrust trial approaches in former college athletes’ class action demanding the rights to profit from their own names, images and likenesses, a federal judged denied the NCAA’s motion to reconsider certain arguments.
     U.S. District Judge Claudia Wilken also granted a motion by a number of broadcasters and nonprofits to file an amicus brief in support of the NCAA.
     The heated legal battle, now in its fifth year, involves the use of college athletes’ images in video games, merchandise and other promotional materials.
     In the first complaint , former UCLA basketball player Ed O’Bannon said the NCAA violated his and other athletes’ right to make money off their likenesses. A separate complaint, later consolidated, was filed by former Nebraska quarterback Sam Keller.
     In April this year, Wilken ruled partly in the athletes’ favor in one of several motions for summary judgment.
     The NCAA has argued that the competitive effects of not paying its student-athletes outweigh the anti-competitive effects.
     The athletes argued that by not offering student-athletes and recruits money from broadcasting and licensing revenue, the NCAA deprives colleges “of a tool that they could otherwise use to recruit the top student-athletes,” among other things.
     The NCAA claims that the principle of amateurism provides competitive benefits because it contributes to the popularity of college sports.
     Because there is conflicting evidence about whether paying athletes would affect the popularity of college sports, Wilken refused to grant summary judgment to either side on that issue.
     The NCAA also claimed that by not paying its so-called student-athletes, schools’ athletic budgets can better support more women’s sports.
     Wilken rejected this argument.
     “This is not a legitimate pro-competitive justification,” the judge wrote in April.
     “It is ‘improper to validate a practice that is decidedly in restraint of trade simply because the practice produces some unrelated benefits to competition in another market,'” Wilken wrote, quoting the U.S. Supreme Court ruling in Sullivan v. National Football League.
     The NCAA could support women’s sports and less prominent men’s sports in other, less restrictive ways, Wilken said.
     “For instance, the NCAA could mandate that Division I schools and conferences redirect a greater portion of the licensing revenue generated by football and basketball to these other sports,” Wilken wrote.
     “The NCAA has not explained why it could not adopt more stringent revenue-sharing rules,” the judge wrote, granting the athletes summary judgment on that issue.
     “The challenged restraint is not justified by the NCAA’s claimed desire to support women’s sports or less prominent men’s sports.”
     The NCAA sought leave to move for reconsideration, arguing that Wilken did not consider the law and facts involving “the scope of the ‘college education’ market” and “the non-existence of less restrictive alternatives.”
     The NCAA argued that Wilken failed to consider that the college education market includes athletes besides basketball and football players, as well as other college students.
     The NCAA quoted its economic expert, who said “the appropriate market definition should be broad enough to consider the full range of competitive effects at issue, including effects on students who are not men’s basketball and football athletes.”
     Wilken rejected this argument, and denied the motion.
     “The breadth of the NCAA’s challenged conduct is not evidence of the breadth of the relevant market,” Wilken wrote.
     “Antitrust plaintiffs’ evidence and arguments make clear that they are challenging the NCAA’s restrictions on student-athlete pay because of the specific impact those restrictions on the college education market for Division I football and basketball recruits.”
     The NCAA also argued that less restrictive alternatives were not feasible, citing declarations from university administrators and athletic directors.
     “These declarations assert that Title IX makes it difficult for universities and conferences to redistribute revenue from men’s sports to women’s sports,” Wilken wrote. “These declarations rest on a questionable understanding of Title IX.
     “Furthermore, to the extent Title IX does prevent Division I schools and conferences from redistributing revenue from men’s football and basketball to women’s sports, it would undermine the NCAA’s own argument here – namely, that restrictions on student-athlete compensation make it easier for schools to redistribute funding to women’s sports and less prominent men’s sports.”
     Earlier this month a number of broadcasters and nonprofits filed two amicus briefs in support of the NCAA’s motion for interlocutory appeal of Wilken’s April order .
     The broadcasters include ABC, CBS and Fox, and were joined by the Reporters Committee for Freedom of the Press.
     The First Amendment Coalition filed a separate brief.
     “State law has consistently vested exclusive broadcasting rights in the producers of entertainment, not individual participants in a team sport,” attorney Celeste Phillips wrote for the broadcasters.
     As the NCAA has done, the broadcasters’ brief notes that Little League and high school basketball games often appear on television, and those minor athletes are not compensated for their rights of publicity.
     Wilken granted the broadcasters’ motion to submit their amicus briefs in a one-page order Monday.
     The judge wrote that the antitrust plaintiffs can submit a reply brief, but cannot repeat any arguments they previously raised.

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