A federal judge late Friday granted class-action status in a damages lawsuit against the NCAA and major college athletic conferences that could result in a multibillion-dollar award for former college athletes and current.
The suit challenges the association’s remaining rules regarding athletes’ ability to make money from their names, images and likenesses and seeks damages based on the share of television rights money and revenue from social media that she claims athletes would have received if the NCAA’s previous limits on name-image and likeness (NIL) compensation did not exist.
Lawyers for the NCAA and conferences had written in legal documents that athletes are seeking more than $1.4 billion. The filings do not clarify whether this figure takes into account the tripling of damages awarded in successful antitrust cases. If not, more than $4.2 billion could be at stake in this case.
Specifically, the suit claims that football, men’s and women’s basketball players from schools in the Power Five conferences are entitled to damages related to the use of their NILs in broadcasting games and that athletes of any sport at a Power Five school are entitled to damages related to social media revenue. If the plaintiffs are successful, most of the money would be split among athletes in those three sports who received full scholarships and play — or have played — for a school in one of the Power Five conferences since June 15, 2016. This date is four years before the initial filing of the complaint, a feedback period permitted by antitrust law.
Citing an economic expert for the plaintiffs, Friday night’s ruling said nearly 6,300 men’s football and basketball players would be entitled to damages, as would more than 850 women’s basketball players. Nearly 7,400 athletes in other sports would also be covered, but not for money tied to TV broadcast rights revenue.
Had U.S. District Judge Claudia Wilken refused to grant class-action status to the damages portion of the case, any monetary award would have been limited to the claims of the three named plaintiffs: the male swimmer from the state of Arizona, Grant House; Sedona Prince, former Oregon and current TCU women’s basketball player; and former Illinois football player Tymir Oliver.
Today, the NCAA and conferences face the type of consequences that led to their increasingly intense efforts to obtain some form of antitrust protection from Congress as part of a broader measure they want to use to impose a national standard on athletes’ NIL activities. Currently, there is a patchwork of state laws surrounding these activities.
However, the NIL issue pales in comparison to the potential impact of Friday night’s decision – if the athletes prevail in a jury trial currently scheduled to begin in January 2025.
Steve Berman, one of the plaintiffs’ lead attorneys, told USA TODAY Sports via email: This “potentially means student-athletes will share in broadcast revenue, ticket sales and sponsorship deals.” This is a huge potential change in the relationship between the NCAA and student-athletes.
NCAA spokeswoman Saquandra Heath said in a statement: “The NCAA disagrees with this decision because NIL is very specific” in terms of its value to individual athletes, rather than being common or typical to a large group of plaintiffs, as antitrust law requires for class action. -the status of action to be granted in a case. The statement also said the association does not agree with the prospect of the vast majority of damages money going to male athletes. “The NCAA fully supports all student-athletes receiving their NIL rights and the Association is increasing benefits for student-athletes – including new health and wellness requirements and guaranteed academic support for the entire Division I,” the release said.
Wilken is the same judge who oversaw the district court portions of the Ed O’Bannon and Shawne Alston antitrust cases. The NCAA finally lost Alston case in unanimous Supreme Court decision.
About six weeks ago, Wilken has been granted class action status in the portion of this case that seeks an injunction against remaining NCAA rules regarding athletes’ ability to earn money from their NIL and could create the possibility of athletes being able to obtain NIL money from their schools for any reason.
His new ruling represents just one of several major legal challenges facing the world of college sports. On Tuesday, proceedings are expected to begin regarding a complaint filed by the Los Angeles office of the National Labor Relations Board which alleges that the NCAA, the Pac-12 Conference and the University of Southern California illegally misclassified college athletes as “student-athletes” rather than employees.
Meanwhile, the U.S. Third Circuit Court of Appeals continues to consider a case for athletes to be treated as school employees entitled to at least minimum wage under the Fair Labor Standards Act. Additionally, Dartmouth College men’s basketball players are in the midst of a unionizing effort.
A significant part of the money at stake in this case is whether — absent restrictions imposed by NCAA rules — athletes would have gotten a share of the conference’s television revenue. But it’s also an underlying question about whether conferences and schools should engage in revenue sharing with their athletes, as has been considered a nationally watched bill that passed the California State Assembly this summer, but then stalled in the state Senate, which could take up the measure again in 2024.
In that case, the plaintiffs’ economic expert, Daniel Rascher, a sports management professor at the University of San Francisco, argued that, absent the restrictions imposed by NCAA rules, the Power Five conferences would have competes to attract football and basketball players by offering them payouts for games. use of their NIL in broadcasts “as this would have allowed conferences to maximize their broadcast revenues”. He also said conferences allegedly entered into group licensing agreements with athletes under which they offered equal payments to those athletes for use of their NIL in broadcasts.
The NCAA had argued, in part, that there was no reason to assume that athletes’ NIL on the broadcasts had any value because no payments had been made to college or professional athletes to specifically compensate them for the use of their NIL in these broadcasts.
“However,” Wilken wrote, she found “broad support for plaintiffs’ assumption that NIL student-athletes on broadcasts have value, and that their value represents at least ten percent of contract revenue broadcasting of the defendants.”
According to data compiled by USA TODAY Sports from the Power Five conferences’ federal tax filings for their 2022 fiscal years, they totaled more than $2.2 billion in broadcast rights that year.
Wilken also wrote that Rascher’s opinions and methodology as well as those of the plaintiffs’ sports media and broadcast rights expert, former NBA executive and current independent media consultant Edwin Desser, “are sufficiently reliable and capable of supporting a reasonable jury conclusion that “college football and basketball players “would have received…compensation” for the use of their NIL in broadcasts “in the absence of the challenged rules.”
