NCAA’s Era of Exploiting College Athletes Is Ending
(Bloomberg Opinion) -- The dam has broken. College athletes are going to be paid — eventually. And it’s about time.
The Supreme Court on Monday confirmed unanimously that the National Collegiate Athletic Association is a business that has to conform to the same antitrust rules as any other business. That means its days of operating a multibillion-dollar industry on the backs of an unpaid labor force — the players — are dwindling rapidly.
The issue in NCAA v. Alston, which was argued before the court in March, was narrower than we NCAA critics might have liked. In 2019, a district court judge, Claudia Wilken, ruled that although the NCAA might justifiably limit player compensation for their athletic activities, it could not limit benefits that were related to their education — anything from money for extra tutoring to a post-graduate internship. Both sides appealed, but the U.S. Court of Appeals for the Ninth Circuit upheld Wilken’s ruling.
The players chose not to appeal to the Supreme Court — a mistake, it turns out. The NCAA, however, did appeal, arguing as it has so many times in the past — before both federal courts and the court of public opinion — that the essence of college sports was “amateurism” and that any move to pay the players would destroy it. That fact meant that the courts should judge its actions “under an extremely deferential standard,” as Justice Neil Gorsuch put it in his decision.
Why would the NCAA take such a stance? Because for more than half a century, it had convinced the country — and itself — that amateurism was a force for good and that players who took money were cheaters who should be deprived of their athletic eligibility. But as the world changed — as money poured into college sports, enriching coaches and athletic directors and conference commissioners — so did the conventional wisdom about paying players. What didn’t change with the times was the NCAA’s hardline stance. It came to the Supreme Court armed with arguments that had lost their potency.
In his decision, Gorsuch used the explicit language of antitrust to describe the NCAA. “Put simply,” he wrote, “this suit involved admitted horizontal price fixing in a market where the defendants exercise monopoly control.” For decades, the NCAA has relied on a 1984 Supreme Court decision — a decision it lost — as a legal justification for not paying college players. Gorsuch mocked that rationale. He went down the list of the NCAA’s arguments, one after another, and left them in shreds. He concluded, as both Judge Wilken and the Ninth Circuit did, that the NCAA’s compensation rules, at least as they apply to education, violate antitrust laws. This has been true, of course, since the 1950s, but hey, better late than never.
So where does that leave us? First, more than a dozen states have passed laws allowing college athletes to cash in on their names, images and likenesses, with the starting date in six of those states coming July 1. The NCAA’s effort to control the process has thankfully failed; it tried to come up with its own NIL rules but got nowhere. An attempt to pass a bill in Congress that would preempt the state laws has also stalled. In all likelihood, every state will pass an NIL bill by the time football season starts. (Heaven forbid they lose prized recruits to another state because they don’t have an NIL bill.) The NCAA will have no choice but to go along. So that’s one form of compensation.
A second form of compensation will be the education-related benefits the Supreme Court just upheld. But that is hardly going to be the end of it. In his decision, Gorsuch mentioned several times that the court was only being asked to rule on the validity of the educational benefits Judge Wilken had ordered. His implication was that if the players had appealed — and had asked that all compensation limits be ruled illegal — they might well have prevailed.
In a concurring opinion, Justice Brett Kavanaugh practically pleaded for someone to bring another antitrust suit against the NCAA so the court could rule against amateurism once and for all. “I add this concurring opinion to underscore that the NCAA’s remaining compensation rules also raise serious questions under the antitrust laws,” he wrote. His last paragraph could have been lifted directly from a speech by Sonny Vaccaro, Jay Bilas or Taylor Branch — any of the early critics of the NCAA’s amateurism rules. I quote it in full:
To be sure, the NCAA and its member colleges maintain important traditions that have become part of the fabric of America — game days in Tuscaloosa and South Bend; the packed gyms in Storrs and Durham; the women’s and men’s lacrosse championships on Memorial Day weekend; track and field meets in Eugene; the spring softball and baseball World Series in Oklahoma City and Omaha; the list goes on. But those traditions alone cannot justify the NCAA’s decision to build a massive money-raising enterprise on the backs of student athletes who are not fairly compensated. Nowhere else in America can businesses get away with agreeing not to pay their workers a fair market rate on the theory that their product is defined by not paying their workers a fair market rate. And under ordinary principles of antitrust law, it is not evident why college sports should be any different. The NCAA is not above the law.
I’ve seen a few tweets noting that if both Brett Kavanaugh and Sonia Sotomayor oppose your arguments, maybe you need a new approach. But I think of this decision in a somewhat different way. The NCAA’s refusal to allow the players to be paid has always been a blatant antitrust violation, one that should have been easy to spot by liberals and conservatives alike. But for too long, we allowed ourselves to be blinded by the NCAA’s rhetoric. What the Court’s 9-0 decision shows is that we are finally looking at the NCAA with eyes wide open.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Joe Nocera is a Bloomberg Opinion columnist covering business. He has written business columns for Esquire, GQ and the New York Times, and is the former editorial director of Fortune. His latest project is the Bloomberg-Wondery podcast "The Shrink Next Door."
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