"What You Should Know About The Trial That Could Change College Athletics Forever"
It has been five years since former UCLA basketball star Ed O’Bannon sued the NCAA in federal court, alleging that it had violated his rights to control his own name, image, and likeness. Since then, the case has been combined with others, evolved into a larger case over the basic NCAA economic model, picked up additional plaintiffs, and turned into a class action suit against the NCAA.
Monday, it will finally go to trial, when Judge Claudia Wilken oversees opening arguments in the Northern District of California. It is a case that both sides have said could reshape the future of college athletics. Here’s what you need to know:
What’s the issue?
Over the last five years O’Bannon’s lawsuit has turned into a case about the basic NCAA economic model and whether players should have the right to share in television broadcast, re-broadcast, and video game revenues and all other licensing money they help create. In essence, the players are arguing that the NCAA has illegally conspired to fix the value of their names, images, and likenesses at zero with rules that prevent them from sharing in those revenues.
The players are no longer seeking damages for past revenue lost. But they are seeking an injunction that would prevent the NCAA, its member conferences, and schools from locking current and future players out of those revenues altogether.
Who is involved?
The most prominent name is O’Bannon, the former UCLA star who, as the story goes, saw friends playing an NCAA-branded college basketball video game and noticed a player that looked a lot like himself on a classic UCLA team roster (O’Bannon led UCLA to the 1995 national title). There are other former athletes involved, and six current college athletes joined the case in July.
The current athletes are important, because in November, federal judge Claudia Wilken, who is overseeing the case, partially certified the case’s class action status, ruling that the plaintiffs could represent all current athletes, but that it would be too hard to discern damages for former college athletes. O’Bannon will likely testify early in the trial, and both his testimony and that of the current athletes — if they testify — will be important for building the plaintiffs case, and a focal point as the NCAA tries to tear it down by making the point that athletes aren’t exploited by the current model.
On the other side, there is NCAA president Dr. Mark Emmert, who is likely to testify and has been the organization’s public face in fighting back against both this suit and others (the New York Times detailed Emmert’s role Monday). It is possible that commissioners of some of the NCAA’s biggest conferences will testify too, according to a list of potential witnesses. Both sides will bring economists and business analysts to the stand to support their view of college athletics.
And then there is Wilken, the federal judge. Wilken has asked important questions and poked potential holes in the cases both sides have made, and because this is now a bench trial, she, not a jury, will have the final say over any ruling at the district court level.
The case initially involved EA Sports and the Collegiate Licensing Company, which oversees most schools’ broadcast licensing, but those parties agreed to settle claims against them in February. EA finalized a $40 million settlement with the athletes last week.
What will the players argue?
To make their antitrust case, the O’Bannon lawyers will have to show that there is a competitive marketplace for the use of college athletes’ names, images, and likenesses that the NCAA is suppressing with restrictive rules that fix the value of athletes’ names at nothing in violation of federal antitrust law.
The players’ attorneys think they can make this argument with little problem. In a pre-trial brief filed last Tuesday, they indicated that they prove that marketplace exists by showing that EA Sports, the video game manufacturer that was once a defendant in this case, was willing to compensate players for appearing in their video games but could not because NCAA rules prohibited such payments. The plaintiffs will rely on earlier testimony from former EA executives to show that the company “wanted to obtain the rights for more precise likenesses and the names of every college athlete on each roster, for which EA was willing to pay more to the NCAA and the college athletes themselves.”
Wilken has asked the players’ attorneys to demonstrate that allowing athletes to earn compensation for use of their names, images, and likenesses will not totally alter the competitive landscape of college sports, a key argument the NCAA will make to state its case (see below).
The players will also argue that NCAA rules against paying players lead schools to funnel money into other areas, namely rising coaching salaries and facilities upgrades, instead of compensating athletes. There will be plenty of talk about money, whether it’s the amount the NCAA is bringing in from selling broadcast rights for the NCAA Tournament, the amount conferences and schools make selling similar rights for football and basketball, or the large amounts being paid to coaches at some of the NCAA’s biggest programs.
What about the NCAA?
The NCAA will, in effect, concede the point that college athletes could earn big money from licensing, but it will use that fact to argue that allowing players to earn compensation from broadcast rights and video games would throw the current competitive structure of college sports out of whack. In its pre-trial brief last week, the NCAA argued that large schools would offer certain athletes benefits in excess of $100,000 to attract them to their programs if they were allowed to use broadcast revenues to pay athletes. And if that happened, the NCAA argues, it would further skew the current model’s competitive imbalance toward big schools in a way that would irreparably damage college athletics. Football and men’s basketball may already be imbalanced, as coaching salaries, facility upgrades, and on-field results show, but the NCAA will argue that the current landscape is “properly imbalanced,” a la professional sports leagues like Major League Baseball and the NBA, in a way that keeps games interesting for fans. More imbalance, NCAA lawyers contend, would ruin the product.
The NCAA will also argue that paying college athletes would fundamentally damage the educational relationship players have to their schools. If college athletes are compensated, the NCAA argues, there will be no reason for them to serve as students and athletes. “Why would a university want to hire a team to play sports with their uniforms on?” Emmert asked in a New York Times profile published Monday. “If you did do that, why would you want them to be students? If they are employees, why would you want calculus to get in the way of football?” That question holds relevance to other cases challenging the NCAA model — O’Bannon’s suit doesn’t involve the student-versus-employee distinction — but it is indicative of the educational argument the NCAA will make in this case.
Here’s what the NCAA won’t (or won’t be able to) argue: that college athletes cannot share in revenues because schools can’t afford it, because those revenues are used to subsidize non-revenue sports like baseball, golf, or tennis, or that its stated amateurism ideals are fundamental to the success of college sports. Wilken has noted, and the NCAA has admitted, that there is plenty of money to compensate athletes in the system. It is well-documented that NCAA schools funded non-revenue sports before broadcast revenues surged to current levels for football and men’s basketball. And as Wilken told the NCAA in a February hearing, “I don’t think amateurism is going to be a useful word here.”
What happens if the players win?
O’Bannon and the players entered the case seeking damages, but they altered their case in May to seek an injunction that would prevent the NCAA from limiting how much players can earn for playing or from licensing fees, and if they win, NCAA schools would have to begin compensating players for use of their names, images, and likenesses. The players have previously asked for up to a 50 percent share in all broadcast and video game licensing fees, but what share they would ultimately receive depends both on the ruling and how they would go about negotiating with the NCAA, conferences, and member schools. The players have proposed a Former College Athletes Association that could handle some licensing and payment issues, and they have also suggested putting the money into a trust fund that athletes could access only after their collegiate careers are over. But these are mere suggestions, and while the plaintiffs also proposed their own injunction, what any sort of payment model would look like — its also possible that athletes could band together to negotiate rights fees the way players’ unions in pro sports do — depends on the scope of the possible injunction.
How this would affect the landscape of college athletics is unclear, though it would certainly be a serious alteration in the current structure, as players for the first time would be sharing in the revenues they help generate. That’s a major change, and one advocates for paying players would certainly celebrate (while turning their attention to other lawsuits that go even farther, including Jeffrey Kessler’s and the Northwestern union case that is in front of the National Labor Relations Board).
When will we know who wins?
Wilken isn’t expected to take too long to rule after the trial ends later this month — it could be weeks or a few months — but the final outcome won’t be known for a long time. The loser, no matter which side it is, will appeal its case to the 9th Circuit Court of Appeals. From there, it’s possible the case could make it all the way to the Supreme Court, as NCAA officials have said that the issue of player compensation is so fundamental to their structure that they are prepared to take this case all the way to the highest court in the land.
Of course, the two parties could choose to reach a settlement at any point in the trial, as Sports Illustrated legal analyst Michael McCann has noted. Wilken previously ordered the two sides into mediation talks in an effort to foster a settlement — it made little progress — and the players have said they are willing to entertain further settlement talks. The NCAA, however, has shown no indication that it wants to return to the table, so unless dynamics of the case change at trial, it’s unlikely that we’ll see a settlement any time soon. Rather, we’re probably in for years more of wrangling in this case and others like it that make even more fundamental challenges to the collegiate sports model.