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Preparing for a post-O’Bannon world
Stewart Mandel has a piece out today on SI.com describing the range of urgency athletics administrators are feeling regarding the O’Bannon v. NCAA case currently making its way through the courts. For those of you who haven’t kept up with the case, I wrote about it in more detail here. Essentially, former UCLA men’s basketball star Ed O’Bannon and his co-plaintiffs are suing the NCAA, and other defendants, for not sharing the revenue generated in part by student-athletes both while they are in school (e.g. TV) and afterwards (e.g. video games, archive footage). If the O’Bannon plaintiffs were to win, or even settle the case in their favor, the current structure of college athletics will be forever altered.
Mr. Mandel profiled University of Southern California athletic director Pat Haden’s concern that the case is by no means a slam dunk for the NCAA, and how he and his colleagues should be preparing for the aftermath if it were to lose the case. I appreciated Mr. Haden’s comments. Up until now the little we’ve heard from administrators are the doomsday scenarios spouted off by the likes of Big Ten Commissioner Jim Delaney, who claimed his schools would rather de-emphasize sports and join Division III than go along with any type of pay for play scenario.
Mr. Haden is a lawyer. He’s been reading the articles from legal analysts and scholars. He knows the NCAA is vulnerable and the case is soft. More importantly, he knows the stakes have never been higher. It reminds me of this Family Guy/Star Wars clip, with Mr. Haden as Darth Vader and NCAA president Mark Emmert as the Empire’s henchman talking about the “invulnerable” Death Star (current NCAA structure). Mr. Haden is right to be concerned. He is right to be asking questions. He is also right to be taking proactive steps to address the possible outcomes, or perhaps look at acceptable settlement options.
The contrast to Mr. Haden is University of Texas athletic director DeLoss Dodds. He was also quoted in Mr. Mandel’s piece, but with much less concern or urgency than Mr. Haden. Mr. Dodds seemed to think he and other athletics administrators have “more immediate things to worry about,” and “have no control over (the case).” In my view, nothing could be further from the truth. The case exists only because of how the NCAA and its members (of which the University of Texas and Mr. Dodds is one) have constructed the current college athletics model. If those in power change the model, the case goes away. And while Mr. Dodds might simply be one person in a massive bureaucracy, he leads arguably the most powerful athletic department in the country, and SI.com recently named him the 8th most powerful person in college athletics (notice Ed O’Bannon ranks #4). My guess is others will listen when he speaks.
Last week much of the country’s attention was fixed on the Supreme Court’s hearing of two significant same-sex marriage cases. Reading through much of the post-argument commentary from both sides, it seemed apparent that at some point in the future, though perhaps not as a direct result of these two cases, same-sex marriage will be legal across the country. I get that same feel about the O’Bannon case and paying student-athletes. It may not be this case or right now, but at some point in the future college athletes will be paid. The only question is when the new era is ushered in, and how. Pat Haden recognizes this and wants to take action; good for him.
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Future of the NCAA (Part III)
(In Part I we looked at Enforcement, and in Part II the BCS schools separating from the NCAA and conference realignment. In this final post in the series we look at the various legal challenges the NCAA currently faces, and their potential long-term impact.)
In 1984, the United States Supreme Court in NCAA v. Board of Regents ruled that the NCAA violated federal antitrust law by controlling and restraining the television rights of its member institutions, and that those universities and colleges were free to negotiate their own television rights agreements. Needless to say that case has been transformative. What was a “game of the week” each fall Saturday has since become a smorgasbord of televised games to be enjoyed virtually any day of the week. This has spurred unprecedented financial windfalls to participating schools and conferences, and shaped the college athletics landscape we have today.
O’Bannon v. NCAA could be this generation’s Board of Regents. In O’Bannon, former UCLA basketball player Ed O’Bannon and other former NCAA student-athletes filed suit claiming the NCAA and its licensing partners violated antitrust law by not compensating them for the use of their “likeness” in video games, video archive programming (i.e. old games shown on ESPN Classic) and other similar endeavors. If you’ve ever played college football or basketball video games you know many of the players strongly resemble actual players, both in terms of physical characteristics as well as the number on the back of the jersey. This is an example of what the plaintiffs refer to when they use the term “likeness,” and this is what they are complaining about and seeking compensation for. The case began only with former student-athletes seeking damages beginning from the time they finished school and thereafter; however, current student-athletes were (somewhat controversially) recently added to the group of plaintiffs in order to claim damages for the time they are in school as well. There have been several preliminary hearings, and things have not gone well for the NCAA thus far. The case is on track to go before the judge for class certification this summer, with the trial to take place sometime in early 2014.
If the NCAA were to lose, the ramifications would be immense. First there is the financial component, which could be tens of millions in damages or some say hundreds of millions. There is also the complete reversal of decades of policy in which compensating student-athletes for anything related to their athletic ability outside of a scholarship has been forbidden. Changes to both rules and structure would certainly need to be put in place moving forward in what would be a new era of NCAA athletics. On the PR front, the hits have already begun, and will continue to come throughout the pretrial process. We’re starting to see documents released which are, at best, embarrassing to the NCAA. You can be sure more documents will become public as the case continues on, and each new day increases the odds of a crippling revelation.
If O’Bannon wasn’t enough, the NCAA is facing several other legal challenges as well. You thought the USC / Reggie Bush affair was all over? Think again. Former assistant football coach Todd McNair is in the middle of a defamation suit against the NCAA for the way it conducted its investigation into he and the USC football program. Mr. McNair claims the NCAA maliciously disregarded the truth and used false information to come to its conclusions and penalties, and as a result his career and future earnings as a coach were unjustly diminished. In November, a judge ruled against the NCAA’s motion to dismiss the case, and in his opinion blasted the NCAA for an investigation he called “malicious,” and NCAA staff members who were “over the top.”
A similar case involves former State University of New York at Buffalo men’s basketball coach Tom Cohane. Though less publicized, Cohane has the potential to markedly change how NCAA investigations are conducted going forward. Mr. Cohane sued the NCAA claiming defamation and a violation of his due process rights under the Fourteenth Amendment, alleging the NCAA knowingly used information provided by the university that was false and coerced, in order to tie him to the violations. Student-athletes have since given sworn statements that they were threatened and pressured to point the finger at Mr. Cohane, even though they never saw him do anything wrong. The litigation then went on a complicated but potentially significant procedural journey to determine whether the NCAA could be considered a “state-actor,” a necessary step for Mr. Cohane to claim Fourteenth Amendment due process protections. The 2nd Circuit Court of Appeals said since (if the facts were proved) the NCAA essentially acted along side the (undeniably state actor) public university to investigate and discipline Mr. Cohane, it could be considered a state-actor in this circumstance.
What does all this mean? Until now, this issue had clearly been settled by the United States Supreme Court in Tarkanian v. NCAA, when it said the NCAA is not a state-actor and therefore does not have to afford due process rights to those it investigates and punishes. This flexibility has allowed the NCAA to be more aggressive with its investigations and have a lower burden of proof in order to impose penalties. But now with Cohane, an example may exist whereby due process rights would have to be provided, and higher burdens of proof would have to be met. The distinction between the two cases boils down to the level of cooperation between the university and the NCAA during the investigation. In Tarkanian, the university and its coach Jerry Tarkanian were denying all the allegations, and fighting together with the NCAA as their common adversary. Therefore the Court said the NCAA was not a state-actor in that instance. In Cohane, however, the university was acknowledging the violations against Mr. Cohane and allegedly working with the NCAA in “joint activity” to make sure the allegations stuck to him so he could be fired for cause. So in that case the 2nd Circuit says the NCAA could be a state-actor. (The NCAA appealed the 2nd Circuit’s decision, but the Supreme Court declined to hear the case). This is a case to watch through its completion, as it could dramatically change how both the NCAA and universities conduct investigations in the future, and the level of due process afforded individuals who find themselves in the middle of them.
All that and we haven’t even touched Miami or Penn State. Looking back on this series of posts, it’s overwhelming to think about what the the NCAA faces in the coming months and years. My view is the NCAA’s back is against the wall, and it must reinvent itself or it will become obsolete, if it isn’t already.
Follow Daniel on Twitter at @DanielHare.
