Supreme Court Deals Powerful Blow to NCAA “Amateurism”
In a unanimous ruling, the Supreme Court dealt a powerful blow to the NCAA’s oft-recited concept of amateurism. Used to restrict athletes from obtaining nearly any benefit for their athletic abilities other than their scholarships and attendant benefits (which, to be fair, are not insignificant), the NCAA’s reliance on amateurism to escape antitrust scrutiny came under attack in the Court’s ruling in NCAA v. Alston, found here. The Supreme Court, in an opinion authored by Justice Gorsuch with a strong concurring opinion by Justice Kavanaugh, affirmed the district court’s ruling (which was subsequently affirmed by the Ninth Circuit) that NCAA limitations on education-related benefits constitute illegal restraints on trade. While the district court also determined that rules limiting athletic-related benefits constitute acceptable restraints, the student-athletes did not appeal that issue. However, the Court’s opinion seems to indicate that those restrictions could be the next to fall.
Noting the greatly increasing business aspect of collegiate sports – especially football and basketball – the Court subjected the NCAA’s restrictions to standard antitrust analysis: whether the restraint is an “undue” restriction under a “rule of reason” analysis. While the details of the legal analysis are a bit too much for a blog post, the practical import of the Court’s opinion is not. Instead of the stricter rule of reason analysis, the NCAA argued that the Court should review its rules under an “abbreviated deferential review.” The NCAA also argued that the Supreme Court, in NCAA v. Board of Regents of Univ. of Okla., found here, already approved restrictions on student-athlete compensation. The Court rejected both arguments, and agreed with the lower courts that the NCAA held monopoly power and that it should be subject to scrutiny like any other monopoly.
Applying typical antitrust review to the NCAA’s restrictions, the Supreme Court affirmed the lower courts’ decisions that restrictions on academic-related compensation (i.e. post-graduate scholarships, paid internships, paid tutors, etc.) impermissibly restrained trade. But, remember that the lower court also decided that athletic-related rules were tied closely enough to the NCAA’s stated mission and market (collegiate sports) to be reasonable. The district court noted that “professional-level cash payments . . . could blur the distinction between college sports and professional sports and thereby negatively affect consumer demand.”
Granting the NCAA “considerable leeway,” the district court did allow the NCAA to (a) develop its own definition of education-related benefits, (b) agree on rules about how conferences and schools provide education-related benefits, and (c) continue to limit education-related cash awards. Finally, the Court emphasized that its decision only applies to the NCAA and multi-conference agreements, not the individual conferences themselves, which can still impose every restraint struck down by the district court. (Remember, this is an antitrust case.)
Notwithstanding these limitations, the decision is a major win for student-athletes. Every year, the “amateurism” of college sports diminishes with the increase of the “business” of college sports. While the NCAA, conferences, schools, coaches, and staff make millions from “amateur” athletics, the chorus of people calling for athletes to be paid, or at least allowing them to earn money on their own for their own skills, increases. This decision also must be read in conjunction with student-athletes’ rights to use their name, image and likeness, where states have begun proactively superseding the NCAA by passing laws allowing student-athletes to benefit from their NIL.