ACC Adds Stanford, Cal, SMU and Antitrust Risk
The ACC’s announcement on Friday to add Stanford, Cal and SMU as members starting in 2024-25 further consolidates elite athletic programs into four of the five Power Five conferences.
The Pac-“12” is now left with only Washington State and Oregon State as programs committed (for now) beyond next season.
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The consolidation continues a pattern that began earlier in the summer when Colorado bolted for the Big 12 and, in two ways, could carry major legal ramifications for college sports.
The first is via antitrust scrutiny.
In NCAA v. Alston (2021), the U.S. Supreme Court held that NCAA members and conferences unlawfully conspired to not pay athletes for academic-related expenses. The opinion, written by Justice Neil Gorsuch, notably cautioned the Court was concerned only with “NCAA and multiconference agreements.” He stressed individual conferences (and their member schools) could agree on rules restricting athlete compensation without running afoul of antitrust law.
The Supreme Court’s reasoning was predicated on the presence of conference competition. Although Gorsuch described the NCAA as exercising “monopoly control,” he reasoned that an individual conference restricting competition is not as worrisome, since there are other conferences. If athletes don’t like one conference, they can join a school in another.
Would the Supreme Court feel as certain about conference competition if the Power Five became the Power Four or the Power Three?
That’s a question that could be answered in the form of an antitrust lawsuit. An athlete could challenge a conference’s restriction on compensation by arguing that conferences are no longer competitive and that major conferences have evolved into national entities that rival the NCAA.
Consider the ACC. By next year it will have member schools in California, Texas, Florida, New York and other states scattered across the U.S. map.
The second way consolidation intersects with the law is through employment recognition.
As the top conferences morph into quasi-pro leagues—where coaches earn millions of dollars, TV contracts pay billions of dollars, and athletes travel across the country in the middle of academic semesters to play intraconference games—it will become more difficult for the NCAA to credibly argue athletes are not employees.
The NCAA faces the prospect of employment recognition in Johnson v. NCAA. Alternatively, the NLRB could find the NCAA, Pac-12 and USC are joint employers of Trojan football and men’s and women’s basketball players.
Colleges with less profitable (and often unprofitable) athletic programs should pay attention. If these legal challenges succeed, athletes at Division I schools, including those where the athletes have more in common with their classmates than with pro athletes, would likely be deemed employees, too.
Perhaps the NCAA should move first and recognize that college athletes in the Power Five are employees. It might save the rest of the college sports.
