Sports

The Supreme Court Might Be Ready to Smack Down the NCAA

Amy Coney Barrett accurately summed up the NCAA’s argument as an idea that “consumers love watching unpaid people play sports.”

Joel Ayayi in midair with several Trojans players around him
Joel Ayayi of the Gonzaga Bulldogs goes up for a shot against the USC Trojans in the Elite Eight round of the NCAA Tournament in Indianapolis on Tuesday. Jack Dempsey/NCAA Photos via Getty Images

Technically, National Collegiate Athletic Association v. Alston is a legal dispute about antitrust: Is the NCAA allowed to impose caps on “education-related benefits,” such as scholarships, that schools can provide athletes, or do those caps illegally restrain trade? The NCAA has spent the past two years fighting a 2019 federal district court ruling in favor of the latter argument—that its scholarship rules violate anti-monopoly laws. The case arrived at the Supreme Court for oral arguments on Wednesday, and its outcome could reverberate all over.

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But for the NCAA, this antitrust case is not really about antitrust, nor is it motivated by the association’s passion for proper anti-monopoly regulation. Instead, Alston is about the same thing every big NCAA action is about: defending schools’ right to not pay their athletes.

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Handicapping the outcome is difficult because activism around this issue has cut across ideological lines to an unusual degree. Members of Congress from Rep. Mark Walker of North Carolina (a MAGA Republican) to Sen. Chris Murphy of Connecticut (a liberal Democrat) have taken aim at the NCAA over the past two years. Statehouses controlled by both Democrats and Republicans have passed laws that would invalidate some NCAA rules within their borders.

The Biden administration argued against the NCAA on Wednesday, and it appeared the players’ side had a receptive ear among justices not normally known for siding with workers.

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Clarence Thomas, who rarely speaks in oral arguments and is considered to be staunchly pro-business, took NCAA lawyer (and Bill Clinton solicitor general) Seth Waxman to task over why college coach pay isn’t restricted the same way as player pay. “It strikes me as odd that coaches’ salaries have ballooned and they are in the amateur ranks, as are the players,” Thomas said. Samuel Alito, another conservative, pro-corporate jurist, also sounded prickly with Waxman, challenging him on whether educational benefits constituted pay-for-play at all. Brett Kavanaugh started his line of questioning for the NCAA by expressing concern that schools were “conspiring” to deny athletes salaries and using antitrust to cover for the exploitation of athletes. Kavanaugh called it “somewhat disturbing” and noted the massive size of college sports TV deals. Neil Gorsuch, too, seemed to wonder about price fixing.

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Liberals Stephen Breyer and Sonia Sotomayor were combative against the NCAA’s arguments, with Breyer asking what exactly the NCAA was complaining about and Sotomayor sounding perplexed as to why the NCAA’s rules weren’t a clear-cut antitrust violation. It seems at minimum possible that a few of the conservative justices could join them to rule against the NCAA. But it’s worth considering that the justices’ harsh posture toward the NCAA may not translate to a decision against the association. When Breyer questioned Jeffrey Kessler, the athletes’ lawyer opposing the NCAA, the justice said, “I worry about judges getting into the business of how amateur sports should be run.” Some of the strongest challenges to the players’ side came from more liberal justices. Sotomayor expressed fear that the justices would “destroy” college sports as we know them by siding against the NCAA.

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The NCAA has pushed Alston to the highest court in the land because, when it comes to player compensation, it apparently doesn’t want to be subject to antitrust rules at all. The association has already asked Congress for an antitrust exemption, which it could use to restrict player compensation without having to worry about suits like this. In testimony to the Senate Judiciary Committee in July, NCAA president Mark Emmert said the NCAA didn’t expect blanket antitrust immunity in “all of its actions,” but that it was “untenable for NCAA rules to be judged as unlawful and subject to repetitive antitrust lawsuits every time the NCAA makes a rule change.” It was a nifty sleight of hand, because Alston and its legal antecedents were not responses to NCAA rules changes. They were the opposite: challenges to NCAA rules that had barely changed at all through decades of players not getting paid for their labor.

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The NCAA has built a large portion of its antitrust argument, in Alston and before Congress, around a defense of amateurism itself. While claiming it “does not seek antitrust immunity,” the NCAA makes clear in its brief to the Supreme Court that it wants anti-monopoly laws taken out of play in how it treats its athletes. The NCAA argues that amateurism rules are essential to making college sports a product people want to consume—“as a product distinct from professional sports,” as it explains. The NCAA spent its oral argument making the same point, repeating that the lack of player pay was “the differentiating feature” between pro and college sports. The justices did not appear to fully buy it. Amy Coney Barrett accurately summed up the NCAA’s argument as an idea that “consumers love watching unpaid people play sports.” However, Alito at one point argued from the bench that there are plenty of fans who feel turned off by professional sports because of players’ high salaries.

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The NCAA’s rationale is a common argument that ignores two things. First, there’s little evidence that a significant group of college sports fans would stop watching if players were compensated more, and there’s even less evidence that such a group is bigger than the contingent that swears off college sports altogether because of its exploitative economic model. Second, professional sports don’t seem to have a problem getting eyeballs.

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It’s not surprising that the NCAA is defending its labor practices. Alston is only the latest battle in a legal war that started in 2009, when former UCLA basketball player Ed O’Bannon noticed his likeness in an EA Sports video game, wondered why he didn’t get paid for that appearance, and filed an antitrust suit against the people who made the game—not just the gaming studio, but also the NCAA and the licensing company that facilitates schools’ involvement in properties like video games. O’Bannon argued it was illegal for the NCAA to withhold cash payments when it used players’ likenesses commercially.

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The game studio and licensing company settled their ends of the case in 2014 for a combined $40 million and later had to pay another $20 million to resolve related litigation. The NCAA, by contrast, aggressively defended the suit and lost at trial later in 2014, in district court in Northern California. The NCAA exhausted its appellate options and then lost a bid for the Supreme Court justices to hear the case in 2016. It was a significant defeat, but only a partial one. The district court judge didn’t overturn the NCAA’s player pay policies altogether but did rule that the NCAA could not ban schools from offering scholarship packages worth the full cost of attendance. That opened the door for universities to pay for athletes’ books and other ancillary expenses, which Power Five schools then did to avoid falling behind one another.

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Alston picks up where O’Bannon left off: by threatening NCAA prohibitions on certain kinds of athlete compensation, but not requiring schools to pay anything. In Alston, the players argued that scholarship rules preventing schools from paying athletes directly were an antitrust violation “because Plaintiffs would receive greater compensation in exchange for their athletic services in the absence of these artificial limits.” Again, the players won a partial victory at the district court level. The same judge from the O’Bannon case presided, and she ruled that caps on benefits “related to education” were against the law. Her decision held that the NCAA can’t impose rules limiting “computers, science equipment, musical instruments and other tangible items not included in the cost of attendance calculation but nonetheless related to the pursuit of academic studies.”

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But the NCAA’s beef is not over schools handing over a few too many free calculators to college athletes. Plenty of schools already spend a lot on education-related items for the players similar to the kind mentioned in the Alston district court ruling. In addition to well-outfitted academic centers reserved for athletes, it’s common for schools to give players tablets, backpacks, and other equipment that might help students work through a college course load.

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Though O’Bannon never got there, Alston is not the first time the NCAA has gone before the justices to argue that its way of restricting markets is so essential to college sports’ success that it deserves friendly treatment. In the early 1980s, Oklahoma and Georgia sued the NCAA for threatening sanctions on any institution that participated in the College Football Association, a renegade TV-deal negotiating partnership that had recently arisen among 60-some schools. The colleges realized that they could get more of their games on TV and make more money by bypassing the NCAA, which had acted as the sole organizer of all TV deals since striking down a similar rebellion by the University of Pennsylvania in 1950. The NCAA argued that its control of TV rights was necessary to protect live attendance at games. The Supreme Court didn’t buy it, and its ruling for the schools in NCAA v. Board of Regents of the University of Oklahoma opened the door to the billion-dollar conference TV deals that today serve as major football’s financial lifeblood. Live attendance continued to boom.

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Understanding why the NCAA is waging this fight requires understanding its relationship with its member schools in the 21st century. The NCAA—the national organization Emmert runs out of Indianapolis—is wildly unpopular. Some of that is because the organization is bad at public relations, and some of it is because it is inherently sexist in how it runs its events.

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But at heart, the NCAA is an association of schools. It’s been that way since 1905, when Teddy Roosevelt asked a group of school administrators to the White House to put their heads together and devise solutions to so many football players getting gored and killed on the field. That organization became the NCAA within a few years. By the mid-20th century, the NCAA was shifting from a player safety organization to an enforcer of amateurism rules, meant to keep the evils of “commercialism” away from the nation’s innocent athletes, all while raking in more and more billions for the schools themselves, their commercial partners, and their nonstudent employees. The schools write those amateurism rules. University administrators are the overwhelming majority of the voices on the NCAA’s decision-making committees, including the powerful Board of Governors.

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For the people in charge of the NCAA’s hundreds of member institutions, the NCAA is a shield that takes on all the incoming flak and litigation that these unpopular policies generate. If the NCAA loses in Alston, that protection grows weaker. As Kessler, the players’ lawyer, sought to make clear, lifting NCAA caps on education-related benefits wouldn’t require schools to change their compensation policies. It would simply bar the NCAA from cracking down.

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Fewer rules against compensating athletes means more schools deciding to pay more, and then drawing more peers who want to keep up with the Joneses. The NCAA functions as an excuse to stay out of that spiral, and cases like Alston threaten its reason for existing—even though the NCAA’s real issue, sharing revenue with athletes, isn’t on the table in this case.

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That is the association’s ultimate fear, as the NCAA has made clear many times. As it said when announcing in 2019 that it would consider changes to rules governing name, image, and likeness payments, the NCAA “will not consider any concepts that could be construed as payment for participation in college sports,” lest it ever lead to “any contemplation of pay-for-play.”

The NCAA spent Wednesday morning making clear that denying a pathway to pay-for-play remained its top priority. On the other side, Kessler didn’t shy away from making his own presentation a referendum on amateurism in general. He called it an “imaginary, revered tradition,” then argued that it did not justify deference to competition restraints.

Alston isn’t about pay-for-play, not directly. But if the NCAA loses this case the way it lost in O’Bannon, it will spring another leak in a boat that is already taking on water.

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