Breaking with numerous cases spanning several decades, a California federal judge denied the NCAA’s motion to dismiss a class action alleging that the NCAA’s eligibility and amateurism rules violate the antitrust laws in In re NCAA Student-Athlete Name and Likeness Licensing Litigation.1 Although the Supreme Court in NCAA v. Board of Regents characterized NCAA amateurism restrictions as “justifiable means of fostering competition” necessary “to preserve the character and quality of the [NCAA's] ‘product,’”2 U.S. District Judge Claudia Wilken left intact the antitrust claim of 21 current and former Division I basketball and football players. For now, then, the NCAA will have to continue to defend its rules under antitrust laws.
Plaintiffs are 25 current and former Division I athletes, of which 21 are antitrust plaintiffs. Their theory of harm is as follows: As a condition of eligibility to compete in NCAA amateur athletics, plaintiffs were required to sign release forms that prohibited them from accepting compensation in exchange for their publicity rights. Absent that release, plaintiffs argued, they would be free to exploit these rights for commercial gain. Plaintiffs further alleged that group licensors such as Electronic Arts Inc. (EA) and the Collegiate Licensing Company (CLC)—the would-be purchasers of student-athlete publicity rights—support and adhere to the NCAA’s rules, which allow licensors to exploit the student-athletes’ publicity rights without providing compensation. According to plaintiffs, this results in a “price fixing conspiracy and a group boycott/refusal to deal” between the NCAA, EA and CLC that restrains trade in an alleged “group licensing” market.
