The NCAA’s interim NIL policy, as well as surprising remarks from NCAA president Mark Emmert and the U.S. Supreme Court’s 9-0 ruling against the NCAA in Alston, are now being actively used by college athletes in the next major litigation to take down the NCAA’s system of amateurism.
Late Monday, attorneys for three athletes (Arizona State swimmer Grant House, Oregon basketball player Sedona Prince and former Illinois football player Tymir Oliver) filed a 115-page amended complaint in their ongoing federal antitrust lawsuit against the NCAA and Power 5 conferences. The three players, who recently added Jeffrey Kessler (of Alston and USWNT legal fame) as co-counsel, hope their case becomes a class action lawsuit on behalf of different groups of current and former Division I college athletes who have competed since 2016.
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The three players argue that NCAA rules, which until July 1 had prohibited athletes from using their NIL for profit, violate antitrust law. The denial of NIL for college athletes should, in the players’ view, lead to monetary damages for athletes who were denied endorsement, group licensing and other opportunities that would have existed in the college sports marketplace. The case falls under antitrust law because the allegation is that competing businesses (i.e., the schools and conferences) joined hands through their NCAA membership to craft and enforce rules that restrain market-based competition (i.e., NIL payments).
As Sportico predicted on June 28, attorneys for the three players have modified their legal arguments to adjust for recent developments. These modifications are apparent in the amended complaint and lead to three key findings.
First, the amended complaint contends that college fans’ interest in their favorite teams hasn’t been harmed in any way by college athletes signing endorsement deals. “What we have seen thus far,” the complaint underscores, “is that NIL opportunities are widespread and have been taken advantage of by student-athletes across a wide variety of sports without any harm to consumer demand.”
The amended complaint spends pages of ink listing examples of college athletes signing endorsement contracts, as well as deals to sell apparel, sign autographs, book live engagements and auction non-fungible tokens. It notes that the companies doing business in college sports immediately responded to the July 1 opening by negotiating deals with college athletes. The amended complaint also asserts that college sports administrators are OK with this change.
To that end, the amended complaint quotes Purdue athletics director Mike Bobinski from July 7, when he publicly said, “For all the wringing of hands and other gloom and doom prognostications, I don’t see [any of that] yet.” It also quotes Big 12 commissioner Bob Bowlsby, who on July 14 acknowledged that, “I think relative to name, image and likeness, there was a commonly held misperception that the sky was going to fall on July 1, and we were going to be in an Armageddon scenario,” but “[o]bviously that hasn’t happened.”
The players’ point raises an obvious inference: If the NCAA didn’t need restrictions on NIL before to ensure consumer demand in college sports, then those restrictions would seem to have unnecessarily denied NIL opportunities for college athletes.
Second, the amended complaint asserts the NCAA’s interim NIL policy “has kept in place some of the most restrictive aspects of its NIL rules.” The complaint emphasizes that the NCAA still prohibits NIL compensation that “is contingent upon enrollment at a particular school” or based on an athlete’s “athletic participation or achievement.” The players’ attorneys argue that “none of the NCAA’s NIL restraints—including the NIL rules that the NCAA is continuing to enforce under its interim policy—enhance consumer demand for college sports.”
The three players demand that Judge Claudia Wilken issue an injunction that would make the NIL market free or at least much less restrictive. To that end, they suggest an injunction could forbid NCAA NIL rules but permit conferences and schools to determine their own NIL policies. The complaint highlights recent comments by Emmert, in which he suggested a decentralized, conference-driven model of college sports. In other words, the players take Emmert’s words and use them against him in a court of law.
Third, the amended complaint maintains its arguments are enhanced by Alston. “Contrary to [the NCAA’s] argument,” House attorneys insist, “the Supreme Court held that the NCAA’s so-called amateurism rules are subject to the same rule-of-reason analysis applicable to other businesses.” This ordinary style of review, the players’ attorneys maintain, should make their case stronger, especially since the Court emphasized that conferences ought to have autonomy—a point the three players say would be more compatible with their goals of a free market than the NCAA maintaining firm control.
Keep in mind, an amended complaint doesn’t prove any of the claims. It merely restates them and draws on recent developments to make them more persuasive. While Judge Wilken denied the NCAA’s motion to dismiss last month, there remain several litigation hurdles—including the summary judgment stage, the class certification stage and a potential trial—that could thwart or diminish the lawsuit.
But for the NCAA, which has been losing in Court in and in Congress of late, the early returns don’t look good.
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