In late 2023, class action certification was granted to former and current collegiate student-athletes suing the NCAA over (i) rules restricting the compensation that the student-athletes can receive in exchange for the commercial use of their names, images, and likenesses (NIL) prior to 2021, and (ii) rules prohibiting universities and college athletic conferences from sharing broadcasting revenue with student-athletes. (In Re College Athlete NIL Litigation). All told, the class action certification is expected to impact thousands of former and current student-athletes. Although the NCAA challenged the class action certification, that challenge was unsuccessful.
On Wednesday, April 3, 2024, more big news came from the In Re College Athlete NIL Litigation matter. The former and current student-athletes filed a motion for summary judgment in the United States District Court for the Northern District of California, seeking to win their case without the need of appearing for trial. Attorneys for the student-athletes argued that NCAA President, Charlie Baker, already defeated the NCAA’s main defense that restrictions on student-athlete compensation is necessary for the good of collegiate sports. In December of 2023, Baker wrote a letter to student-athletes, which proposed a way to allow certain Division I schools to directly compensate their student-athletes. The student-athletes contend that this proposal shows there are less restrictive alternatives the NCAA could have, and can, deploy instead of blanket prohibitions regarding students benefiting from NIL deals directly from their respective college or university and athletic conferences. This is important as the student-athletes’ success in the case is dependent on their ability to prove a violation of the Sherman Act, which prohibits restrictions on fair competition among businesses. In essence, the former and current student-athletes must show the NCAA’s rules and policies unreasonably suppress competition within the market and that there are less restrictive alternatives. Here, the challenged NCAA rules and policies may be found to unreasonably suppress competition if there is a less restrictive alternative to the rules and policies. As such, Baker’s latest proposal may suggest that such an alternative may exist.
All eyes are again on U.S. District Judge Claudia Wilken, who previously ruled in favor of student-athletes in landmark decisions such as O’Bannon v. NCAA and Alson v. NCAA. While the motion is not set to be heard until later this fall, the ramifications of a potential decision are groundbreaking. If Judge Wilken grants the motion, over 14,500 former and current student-athletes will prevail in a case estimated to be worth over $4 billion dollars. While a ruling in favor the student-athletes on summary judgment would likely be appealed by the NCAA, the potential impact of a ruling against the NCAA cannot be taken lightly and the ruling on this motion for summary judgment is certainly something to keep an eye out for.