Judge Claudia Wilken issued a ruling Friday in the Ed O’Bannon case. The headline takeaway is that she found the NCAA’s prohibition on players receiving remuneration for use of their names, images and likenesses to be in violation of anti-trust laws. Judge Wilken said the schools could provide up to $5,000 a year for every year players compete in men’s basketball and football. The money would be placed in a trust for the players to receive once they exhausted their eligibility or otherwise left school.
In one curious part of the ruling, about which I’ve seen almost no commentary so far, Judge Wilken did not authorize athletes to receive compensation for endorsements because “[a]llowing student-athletes to endorse commercial products would undermine the efforts of both the NCAA and its member schools to protect against the ‘commercial exploitation’ of student-athletes.” Many have derided the NCAA”s tortured understanding of “commercial exploitation.” As the NCAA has framed it, commercial exploitation of athletes happens when they receive any compensation above the cost of the grant in aid. That bizarre, inverted understanding of ‘exploitation’ is, in turn, premised on the NCAA’s insistence that, by definition, ‘amateurs’ cannot be exploited. As soon as college athletes do receive compensation above and beyond the grant-in-aid, they are no longer amateurs, according to the NCAA. At that point, they are being exploited.
In other words, the association’s conception of commercial exploitation is necessarily predicated on its untenable formulation of amateurism. Judge Wilken, as I’ll discuss below, hammered the NCAA’s view of amateurism. So, it’s particularly surprising that she nevertheless endorsed their concerns about commercial exploitation.
It’s worth keeping in mind that the Judge’s opinion is only the beginning of what will be a long process. Wilken herself will hear arguments in October about compensation for players. Other lawsuits are proceeding apace, including the action led by labor attorney Jeffrey Kessler, about pay-for-play. And there is still much to sort out about the precise meaning of college athletes’ status as employees, per the NLRB’s ruling earlier this year.
Wilken tore into the NCAA’s definition of amateurism, noting that there is no consistent definition of what the term means. As Jon Solomon relates in his analysis of her ruling, Wilken noted that tennis players can make tens of thousands of dollars, for example, before they enter college, but track and field athletes would lose their eligibility if they received money before college. Additionally, while a football player could receive up to $5,000 in Pell Grant aid without running afoul of NCAA rules, he would if he received the same amount for use of his NIL rights.
“Such inconsistencies,” she wrote, “are not indicative of core principles.” That’s putting it politely.
Wilken was also unmoved by claims that player compensation would undermine competitive balance. She pointed out that the NCAA places no restrictions on how much schools can spend on their facilities or coaches salaries, for example. The result is that some schools already have an enormous competitive advantage over others, which is obvious to every single fan in the history of college sports. Wilken also batted away the alarmist nonsense by the likes of Big Ten Commissioner Jim Delaney, that schools would abandon big-time athletics if courts overturned the status quo. She was also unmoved by the claim that paying players would prevent the integration of academics and athletics since “other students who provide services to the university, such as members of the student government or school newspaper” often receive pay without any fundamental threat to the core mission of the university.
The consensus appears to be that, despite the limits Judge Wilken placed on the amount of money available to athletes from NIL rights, the NCAA has suffered a serious loss. The foundational premise of the Collegiate Model – amateurism – has been dealt what appears to be a grievous blow. There will be appeals, one can presume. And the NCAA, especially the Power Five schools, will continue to fight rear-guard actions by providing more crumbs to players. But the intellectual edifice of the enterprise has been weakened considerably.
Update: Patrick Hruby, in what is, unfortunately, his last post for the apparently soon-to-be-defunct Sports On Earth, examines the ruling in detail. A couple of points to highlight:
1) Hruby notes that the most damning witnesses at trial were the NCAA’s own:
Time and again in her decision, Wilken uses the association’s testimony to support her points. Like Emmert stating that it’s not the NCAA’s mission to stop rich schools from taking advantage of their pricey athletic facilities. Or University of South Carolina president Harris Pastides admitting that schools probably wouldn’t leave Division I in a world without amateurism. Or a parade of NCAA witnesses explaining that fans love college sports for pageantry, tradition, rivalries, school spirit and community pride — anything and everything except unpaid players. Or Daniel Rubinfeld, the association’s expert economist, who in his own college textbook specifically refers to the NCAA as a cartel.
Why does this matter? For one, it’s funny. Downright ironic. More importantly, it makes Wilken’s ruling less likely to be overturned in an appeal, because the NCAA will once again find itself arguing against … itself.
2) Hruby also says that, from the perspective of the fan, nothing much will change:
The big fish of college sports will still out-recruit and outperform the minnows, and the compensation caps mean that schools like Ball State won’t be able to strategically target their resources and outbid schools such as the University of Kentucky for the occasional five-star high school basketball player. Ohio State University will not replace the University of Michigan on its football schedule with Bard College. Women’s lacrosse teams will solider on as money-losing, feel-good university marketing tools. The sky won’t fall; it won’t even get cloudy. And all of that will make amateurism-defending NCAA Cassandras look increasingly out of touch, downright ridiculous, like the Republicans still railing against the Obamacare freedom-pocalypse that never actually happened.