NCAA Early Court Victory Against Tennessee Could Prove Short-Lived
Following U.S. District Judge Clifton Corker’s denial Tuesday of a temporary restraining order (TRO) against the NCAA, the legal scorecard for Tennessee & Virginia v. NCAA reads NCAA 1, Tennessee and Virginia 0.
But as we know from sports, early scores can sometimes prove misleading (see: the Falcons’ 28-3 lead against the Patriots in the third quarter of the 2017 Super Bowl).
More from Sportico.com
Judge Nixes Tennessee, Virginia NIL Injunction Push Against NCAA
NLRB Says Dartmouth Basketball Players Are Employees, Union Vote Next
Although Corker sided with the NCAA on a preliminary matter, he bluntly repudiated NCAA arguments that pay-for-play rules withstand antitrust scrutiny.
As part of a lawsuit against the NCAA, Tennessee attorney general Jonathan Skrmetti and Virginia attorney general Jason Miyares sought a TRO against NCAA rules barring universities, collectives and other interested parties from offering name, image and likeness deals as inducements to join colleges as freshmen or transfers. Had Corker sided with the AGs on the TRO, he would have restrained the NCAA from enforcing longstanding prohibitions against pay-for-play.
The NCAA’s opposition brief emphasized TROs are considered “extraordinary remedies” under the law. Judges aren’t expected to grant TROs absent an uncommon alignment of circumstances. Defendants, like the NCAA here, are thus advantaged going into TRO proceedings and usually favored to win.
Corker reasoned Skrmetti and Miyares couldn’t establish one necessary element for the issuance of a TRO: irreparable harm.
Irreparable harm describes an atypical damages that money can’t later remedy. Permanent destruction to the environment, the release of trade secrets that fundamentally alter an industry or, in the sports context, an athlete missing games—and the opportunity to generate accompanying stats—that will never be replayed, are all “irreparable” in that no amount of money can’t place the plaintiff in the same position they’d be in absent the harm. The two AGs also had to convince the Corker that, absent a restraining order, their states would suffer actual and imminent harm.
Facing this very tall task, attorneys general Skrmetti and Miyares came up short. They argued that without the issuance of a TRO, prospective college athletes would lose opportunities to maximize NIL opportunities in a free market. The AGs included a sworn declaration from Volunteers offensive lineman Jackson Lampley, who described the anticompetitive dynamic of NCAA rules limiting NIL opportunities.
Lampley explained that once an athlete signs a letter of intent with a college, they forgo the chance to incentivize NIL collectives from competing with one another for their business. Along those lines, there is usually only one NIL collective for each major program, so an otherwise robust marketplace for schools and their aligned collectives is lost for a recruit after they commit.
The AGs further maintained the NCAA has already punished a school for NIL activities and could do the same soon to the University of Tennessee. The NCAA recently sanctioned Florida State for NIL activities and is currently investigating UT for ties between a UT-focused NIL collective and the recruitment of prospective UT athletes.
Corker, a former litigator who President Donald Trump nominated in 2018, disagreed with the AGs on whether harm to the prospective athletes is irreparable. He agreed prospective athletes might receive less NIL compensation because of NCAA rules, but “the difference is purely monetary”—meaning money damages could remedy the loss should the AGs eventually win the lawsuit.
Corker further stressed In Re College Athlete NIL Litigation (a.k.a. House v. NCAA), a class action involving more than 14,500 college athletes who are suing the NCAA and Power Five conferences. They seek monetary compensation for lost NIL opportunities, which Corker found consistent with the idea that money can cure NIL harms.
So good news for the NCAA in the sense that rules against pay-for-play remain in effect.
Now comes the association’s bad news: Corker unambiguously signaled he believes NCAA rules run afoul of antitrust law. That’s a problem for the NCAA since the absence of irreparable harm, though a reason for Corker to not issue a TRO, is no barrier to Corker later declaring the NCAA’s NIL-recruiting ban violates section 1 of the Sherman Antitrust Act.
Echoing U.S. Supreme Court Justice Brett Kavanaugh’s concurring opinion in NCAA v. Alston, Corker wrote “there can be no dispute that the NCAA enjoys complete power over the labor market within Division I athletics.” He further found “sufficient evidence” the NCAA’s NIL-recruiting ban “likely harms competition” and operates as an “absolute ban on competitive bidding, which the Supreme Court [has] found to be anticompetitive on its face.”
As Corker sees it, NCAA rules prohibiting colleges from using NIL to recruit athletes resembles an agreement among competing businesses (colleges) to “refuse to discuss prices” with recruits until after an athlete has committed to a school. NCAA members therefore arguably engage in price fixing, which antitrust law prohibits.
Corker further reasoned NCAA rules likely exacerbate “economic exploitation” of college athletes. The judge underscored how the AGs insist “the NCAA, by means of its market power, reduces the market value” of college athletes’ “NIL rights by prohibiting [them] from freely negotiating their services.”
Corker’s viewpoints appear starkly opposed to the NCAA. While the NCAA averted a judicial order that would have immediately compelled profound changes to amateurism in college sports, that order seems likely to be issued later.
Unless the NCAA adopts a major restructuring along the lines proposed by NCAA president Charlie Baker—and does so soon—it faces the prospect of a federal judge ordering the association to change fundamental rules. This is also occurring as an NLRB regional director Monday deemed the men’s basketball players at one member NCAA school, Dartmouth, employees, thus pitting Dartmouth at odds with NCAA membership rules it contractually agreed to follow but also rules that might be declared illegal.
Sounds confusing? Welcome to NCAA amateurism—the 2024 version.
Best of Sportico.com
