SCOTUS Justices Challenge NCAA Amateurism in Historic Oral Argument
The U.S. Supreme Court held the oral argument for NCAA v. Alston on Wednesday. It did not go well for the NCAA. The six conservative justices, along with Justice Elena Kagan, were openly antagonistic to the college sports model where schools agree to not pay the athletes. They appeared to view this model as violating federal antitrust law, which makes it illegal for competing businesses (including colleges) to price fix and limit how they compete.
Highlights and Lowlights from the NCAA’s Argument
Arguing on behalf of the NCAA and Big Ten, former Solicitor General Seth Waxman attempted to persuade the justices that the U.S. Court of Appeals for the Ninth Circuit erred in ruling in favor of former West Virginia running back Shawne Alston over how schools compensate athletes. The Ninth Circuit held that it is a violation of antitrust law for colleges to collude through the NCAA in limiting how they reimburse/pay athletes for academic-related expenses, such as costs for computers and study abroad, internship opportunities and scholarships to attend vocational schools. Alston had initially sought a much broader remedy, one where compensation for athletics-related expenses would also be found illegal. The Ninth Circuit, however, opted for the more restrained ruling.
Waxman extolled the “distinct character” and the more than 100 years of “unique history” of college sports, where the games are played by students who are amateurs. He insisted that much of the appeal of college sports is that the players are not pro athletes. Waxman argued that the Ninth Circuit’s ruling, while couched as a modest remedy, would in fact undermine the core principle of amateurism and dull the NCAA’s “demarcation” from pro sports. He drew particular attention to the prospect of “unlimited cash for post-eligibility internships” and college athletes being paid as much as $5,980 for academic recognition (the NCAA’s cap on cash and graduation awards). Waxman argued the Ninth Circuit’s ruling would lead to pay-for-play. Waxman also objected to judges, who are not experts in college sports, substituting the judgment of the NCAA and its member schools, who are experts.
Chief Justice John Roberts set the tone quickly by asking how Waxman’s romanticized description of college sports comports with schools paying up to $50,000 for $10 million insurance policies to protect college athletes’ future earnings. “That,” Roberts mused, “sounds like pay for play.” Waxman insisted that insurance for injuries is distinguishable but didn’t directly address Roberts’ underlying point.
Then, Justice Clarence Thomas questioned Waxman on why is it that amateurism only applies to the athlete. “Is there a similar focus,” Thomas wondered, about coaches’ salaries “that have ballooned?” Waxman replied that the courts have already struck down NCAA caps on college coaches’ salaries as illegal under antitrust law (the 1998 Law v. NCAA decision), but Thomas’ larger point seemed to have traction with other justices who kept referring to it.
Justice Stephen Breyer, meanwhile, seemed sympathetic to the NCAA’s position. He referred to the special character of college sports, almost parroting Waxman. Breyer worried that under the Ninth Circuit’s ruling it’s possible for student-athletes to be paid “hundreds of thousands of dollars” depending on the value of post-eligibility internships and the value of scholarships for tuition to attend vocational schools (which Breyer said might include law school tuition). This lent Waxman a chance to argue that courts shouldn’t be in the business of de facto creating NCAA rules. He also argued that once courts struck down the cap on coaches’ salaries, their salaries ballooned and the same would happen with college athletes’ so-called “educational” compensation.
Justice Samuel Alito then asked one of the most poignant questions. He drew from several of the amicus briefs to ask Waxman how he felt about “powerhouse” programs generating massive revenues from college athletes, who face “constant pressure to put sports above study,” are effectively denied chances to pursue certain majors, and rarely go on to earn money in the pros. “They are recruited,” Alito bluntly offered, “used up and cast aside.” Waxman disagreed with the premise of Alito’s question, saying many of the college athletes’ outcomes are positive.
Justice Sonia Sotomayor wondered why conferences don’t set compensation limits, given Waxman’s stated fears of a “parade of horribles” emerging along with pay-for-play. Waxman maintained national college sports creates a “prisoner’s dilemma,” in that unless there is national agreement on amateurism rules, there would be a race to the bottom, thereby undermining amateurism. Of course, Alston’s attorneys would argue that if amateurism can’t withstand the effects of actual competition, then it probably isn’t worth upholding.
Justice Elena Kagan then asked Waxman if the NCAA fixes prices. She said his depiction of amateurism “sounds high-minded” but in reality, she stressed, competing colleges have formed an organization—the NCAA—“with undisputed market power” to set salaries at far lower levels than in a free market. Waxman disputed the premise of the question, arguing that the NCAA isn’t a new product being tested but one that’s been around for more than 100 years, and that college sports have a distinct quality.
Justice Neil Gorsuch then joined the discussion with a similarly hostile question to Waxman. He opined that the “center of the case is an agreement among competitors to fix prices in a labor market” and identified the NCAA as a monopsony in that it is the sole purchaser of college athlete labor.
The most acrimonious line of questioning to Waxman came from Justice Brett Kavanaugh. “Antitrust laws,” Kavanaugh argued, “should not be a cover for exploitation of the student athletes.” He dismissed reverence for tradition as irrelevant to antitrust analysis since the NCAA doesn’t have a Congressional exemption from antitrust law (unlike Major League Baseball in the Curt Flood case) and maintained that NCAA v. Board of Regents (a 1984 Supreme Court case where Justice John Paul Stevens opined the NCAA should enjoy “ample latitude” in setting amateurism rules) is “from a different era” of college sports. He also reasoned that Stevens’ language was “dicta,” meaning it lacks precedential effect (and thus doesn’t bind the justices in NCAA v. Alston). Kavanaugh then dramatically added that “schools are conspiring with competitors to pay no salaries to the workers who are making the schools billions of dollars, on the theory that consumers want the schools to pay the workers nothing. That seems entirely circular and somewhat disturbing.”
Waxman tried to defend NCAA amateurism from Kavanaugh’s line of attack, saying the rules weren’t designed to exploit student-athletes. But Kavanaugh followed up in disbelief, saying he didn’t understand why Waxman acted as if “players receiving $6,000 a year” was an “exorbitant amount when the TV contracts are in the billions.” He continued that, “$6,000 a year is not a lot given the time, the injuries and the inability to go to class or to major in the thing they want to do, or to do summer jobs.”
Justice Amy Coney Barrett concluded the questioning of Waxman by asking him to define an amateur. She suggested, “Is it someone who is not paid? Are you saying consumers love watching unpaid people playing sports?” She also asked about the impact of Title IX if the Court ruled against the NCAA. Waxman noted that Title IX is a separate mandate. In other words, the NCAA, like other businesses, has to figure out a way to comply with all applicable areas of law—antitrust, Title IX, etc…
Highlights and Lowlights from the Alston and Justice Department Argument
Alston attorney Jeffrey Kessler and acting U.S. Solicitor General Elizabeth Prelogar (the Justice Department supports Alston’s case) then fielded questions from the justices. The questions were far less hostile and more narrowly constructed.
Chief Justice Roberts and Justice Thomas both asked Kessler about the ramifications of the Court ruling for Alston. They worried that it could spark additional litigation and undermine college sports. Roberts compared the situation to the game of Jenga, where “all of a sudden the whole thing comes crashing down.” Thomas, meanwhile, expressed concern that major programs will “cherry pick” the best players through the transfer program by offering more compensation. Kessler tried to diffuse these concerns, noting that the trial court (Judge Claudia Wilken) and Ninth Circuit upheld restrictions on compensation for athletics.
Justice Breyer, who seemed to find the NCAA’s traditionalist argument persuasive, expressed he “worried about judges getting into the business of amateur sports” and felt that college sports is a “different kind of product.” Kessler didn’t disagree with Breyer as much as say antitrust law still applies. Kessler added that if Congress wants to grant the NCAA an antitrust exemption, it can do so.
Justice Alito then asked Kessler if college sports enjoys a “distinctive characteristic.” Kessler felt that college sports is distinguishable from sports in that students play the games. “We’re not challenging any rules about them being students,” Kessler stressed. “If anything, this is about helping them succeed.”
Probably the most significant question to Kessler came from Justice Sotomayor, who asked Kessler, “For purposes of this court’s review, you are not asking for broader relief than that provided by the district court?” Kessler agreed, meaning he passed on an opportunity to ask the Court to go further than education-related expenses and into athletics-related expenses (the lower courts had upheld NCAA rules on athletics-related expenses).
Justices Gorsuch, Kavanaugh and Barrett followed, with Kavanaugh asking a notable question: What is Kessler’s “endgame” with this litigation? Kavanaugh wondered whether college athletes will seek the right to enter into collective bargaining or pursue Congressional legislation. Kessler deflected the question, saying his only concern was to win this antitrust case.
Prelogar followed Kessler and fielded similar questions. Justice Thomas expressed feeling “perplexed” as to “how the NCAA would be able to preserve what it thinks is an important distinction between student athletes and professional athletes without constantly being involved in litigation?” He argued that instead of $6,000 a year, college athletes might have evidence showing that they should receive a higher amount—perhaps $20,000—and it would not harm interest in college sports. She argued that courts are charged with applying the law and “amateurism is not its own free floating ideal under the antitrust laws.”
Justice Breyer asked Prelogar about non-economic objectives of the NCAA. Prelogar reiterated that “courts shouldn’t be in the business” of considering non-economic objectives under antitrust analysis. She added that Congress could consider that, but it is not for the courts to invent a de facto antitrust exemption.
Justice Sotomayor asked Prelogar a question that seemed to suggest the justice wanted to protect the current framework of college sports. “I’m not sure,” Sotomayor expressed, “you have given me comfort on some of the questions that the Chief Justice asked. How do we know that we’re not destroying the game as it exists?” Justice Kagan, meanwhile, noted that $5,980 seemed like an arbitrary number.
Key Takeaways, Predictions and Second Guesses
The justices will meet on Friday to determine which side won the case. Although drawing conclusions from the justices’ questions in oral argument is an exercise in speculation, Alston seems poised to win. Seven of the justices expressed serious doubts about the NCAA’s legal arguments while Justices Breyer and Sotomayor appeared more supportive. If the vote is divided, then the justices will determine which of them will write the majority and dissenting opinions, with the possibility of concurring opinions for any justices who agree that Alston won but under a different rationale. We’ll have to wait to find out; a ruling likely won’t be released until June or July.
There’s also the possibility that the case is remanded back to Judge Wilken. Several of the justices found the $5,980 figure to be arbitrary and likely to trigger additional litigation. It’s possible the justices will ask for a reassessment of the remedy.
Both sides’ attorneys will also live with their strategic decisions. If the NCAA loses, it will no doubt deeply regret petitioning the Supreme Court to review the Ninth Circuit’s ruling. A Supreme Court ruling that holds amateurism rules are subject to ordinary antitrust scrutiny—and that at least some of the rules fail to satisfy such scrutiny—would become binding precedent that other athletes can rely upon. This is in part why several of the justices worried about opening the floodgates of litigation. The NCAA could have left the Ninth Circuit’s opinion alone.
For Alston, the decision to not ask for more might also warrant reevaluation. Sotomayor directly asked Kessler if he only sought review for academic-related compensation, and not athletics-related compensation. He said that is correct since that is how the lower courts ruled. The answer made sense in the context of trying to win this case: If he asked for a wider review, the justices might be more worried about ruling against the NCAA since it could cause larger disruption to the college sports model. But it also likely precludes the chance for the Alston case to dismantle the larger system of amateurism.
That will need to wait for another day.
More from Sportico.com
