The NCAA Now Battles with EA and CLC
The NCAA has now sued Electronic Arts, Inc. and Collegiate Licensing, Co., reportedly alleging both EA and CLC breached their contractual obligations to the association and can’t use a $40 million settlement to exit an antitrust class action brought by student-athletes alleging unauthorized use of their likenesses.
The class action brought by student-athletes was against both EA and the NCAA. EA is attempting to settle with the athletes, and the NCAA’s attempt to get the suit dismissed was not successful.
On November 4, the NCAA asked a Georgia court in its complaint to prevent EA from moving forward with its proposed $40 million settlement with the student-athletes because, according to USA Today, EA failed to maintain liability insurance to cover “pending third-party claims”.
CLC’s role claimed by the NCAA, is that it reportedly failed to ensure EA had adequate insurance and refused to give NCAA access to documents and records that the association requested.
CLC claims it has no reason to be involved in the NCAA’s suit. Andrew Giangola, vice president of strategic communications for CLC’s licensing affiliate IMG College said, “CLC is caught in the middle of a dispute between NCAA and EA which should not involve us. CLC has valued relationships with both the NCAA and EA and while we hope they can soon resolve their dispute, we see no reason for CLC to be involved.”
It appears that this is the NCAA’s response to the decision by a California federal judge earlier this month to certify the athletes as a class to pursue a challenge to the NCAA’s ban on compensation itself. But the judge denied certification to a class that sought potentially billions in past damages allegedly caused by not being able to reap the benefits of collectively licensing their images.
The case is National Collegiate Athletic Association v. Collegiate Licensing Co. et al., case number 2013CV238557, in the Superior Court of Fulton County.