Why and How the Supreme Court Should Have Decided O'Bannon v. NCAA
Antitrust Bulletin, Vol. 62, No. 1, 2017
42 Pages Posted: 14 Jun 2017
Date Written: June 13, 2017
Despite requests by both parties, the United States Supreme Court refused to grant a writ of certiorari in O’Bannon v. NCAA, the first federal appellate court decision holding that an NCAA student-athlete eligibility rule violates section 1 of the Sherman Act. The Ninth Circuit ruled that NCAA rules prohibiting intercollegiate athletes from receiving any revenue from videogames and telecasts incorporating their names, images, or likenesses unreasonably restrain economic competition among its member universities in the college education market in which these athletes purchase higher education services and sell their athletic services, which violates federal antitrust law. Circuit court rulings conflict regarding whether student-athlete eligibility rules are commercial restraints subject to the Sherman Act, and lower courts have inconsistently interpreted and applied NCAA v Board of Regents of University of Oklahoma, the Supreme Court’s only intercollegiate athletics antitrust law precedent. The Supreme Court’s refusal to resolve this conflict continues the significant judicial confusion regarding how antitrust law constrains the NCAA’s governance of intercollegiate athletics, which has evolved into a multibillion dollar part of the entertainment industry with millions of fans and more than 450,000 student-athletes. Its decision not to do also creates uncertainty regarding how lower courts will resolve pending antitrust challenges to other NCAA amateurism rules and input market restraints such as limits on the duration and maximum number of athletic scholarships per sport as well as transfer rules. This article makes some recommendations for applying section 1 to NCAA student-athlete eligibility rules and input market restraints, which will better promote consumer welfare, protect student-athletes’ economic rights, and permit the NCAA to promote the unique features of intercollegiate sports without unwarranted judicial micromanagement.
Keywords: O'Bannon v NCAA, Sports Law, Antitrust, Amateurism Rules, Input Market Restraint, Rule of Reason, Less Restrictive Alternative
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