The NCAA’s Collapsing House of Cards
The question is no longer if, but rather when and how college athletes will be compensated beyond scholarships. Though it is a complicated issue, two factors indicate change is coming sooner rather than later. The recent settlement of the Keller and O’Bannon lawsuits against Electronic Arts, though important, are not what I am referring to. I am referring to Judge Claudia Wilken and Jeffrey L. Kessler. Judge Wilken is the federal judge presiding over the O’Bannon anti-trust lawsuit against the National College Athletic Association and Mr. Kessler is a labor attorney who filed an anti-trust suit against the NCAA in March directly challenging the economic model of the organization.
Essentially, Kessler’s lawsuit seeks to allow current college athletes to become free agents and negotiate for their compensation as such. Kessler is widely credited with ushering in the modern era of free agency in the National Football League. Kessler’s suit could prove more problematic for the NCAA if successful because they will lose almost all control over how athletes are compensated. Further, schools paying more for athletes will likely want to restructure agreements with the NCAA (like television contracts) to limit the impact on their bottom line.
This type of change seems inevitable, with the traditional arguments being shut down by critics, attorneys, and most importantly, judges. Though the NCAA still clings to them, as anyone would holding onto a golden goose, they no longer make too much sense. Usually, the NCAA first goes with the paternalistic argument. They claim an education is enough compensation and paying their athletes would corrupt them. The reality, however, is that graduation rates for athletes in the big money sports (football and men’s basketball) are abysmal and their classes are either a joke or non-existent (just ask Rashad McCants, who accomplished the admirable achievement of Dean’s list without ever setting foot in a classroom at UNC). To the second point, if the money would corrupt them at the time, then the teams and the NCAA could easily put the money in a trust fund the “student” athletes could not access until their playing days were over. When this easy fix is pointed out, the NCAA then goes to the Title XI defense, asserting that “paying players . . . would inevitably lead to the elimination of non-revue sports”. Why the NCAA’s Title XI excuse no longer works, Kevin Trahan. Judge Wilken’s, however, has seen through this argument in the O’Bannon case and ruled they cannot use the argument. Wilken stated the NCAA “could mandate that Division I schools and conferences redirect a greater portion of the licensing revenue generated by football and basketball to these other sports. The NCAA has not explained why it could not adopt more stringent revenue-sharing rules”. Id. There is a good reason they haven’t: because there isn’t one. The NCAA is trying to claim they would be unable to govern revenues and in the same breath claim to have oversight of its members. This did not fly with Judge Wilkens, and if O’Bannon eventually prevails the precedent could prove incredibly helpful to Kessler’s suit. Kessler has the experience, expertise, and the financial resources to litigate what is sure to be a long legal battle. The NCAA surely will not allow this without a fight, but it certainly seems they will be on the losing end.
Update coming soon.