OT: NCAA in Trouble on O'Bannon Lawsuit

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January 29th, 2013 at 9:24 PM
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smwilliams
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OT: NCAA in Trouble on O'Bannon Lawsuit

NCAA might be facing doomsday soon enough as a judge ruled that NCAA athletes can pursue a cut of the billion-dollar television contracts, not only when games are re-broadcast, but also current rights deals.

From the ESPN article...

"Now the (NCAA and its co-defendants) are facing potential liability in the billions of dollars instead of tens or hundreds of millions," said Michael Hausfeld, interim lead counsel for the plaintiffs. "It's a more accurate context for what the players deserve."

If the NCAA and the conferences have to share the pie that is television revenue (a.k.a., the only source of revenue), this could be a death blow to the way college athletics operate now.

Link: http://espn.go.com/espn/otl/story/_/id/8895337/jusge-rules-ncaa-athletes-legally-pursue-television-money

 

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January 29th, 2013 at 9:30 PM | Speechless. This clearly a (Score:2 Normal)
Belisarius
Joined: 08/12/2010
MGoPoints: 1050

Speechless. This is clearly a bridge too far. This would eradicate any sense of the players being "amateur" athletes. Why not ust make a minor league for the NFL and have done with it?

Not that I think the NCAA deserves all the money it makes, mind you.

Don't quote laws to us. We carry swords.

-Pompeius Magnus

January 29th, 2013 at 9:33 PM | I get your point, but at the (Score:5 Normal)
willywill9
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I get your point, but at the same time why is there virtually only one path to the NFL (amateurism)?  You don't have to go through NCAA to play professional baseball or soccer.  Why can't athletes capitalize off their skill sets, while Athletic departments can?

Touchdown Michigan!

January 29th, 2013 at 10:17 PM | I think because football and (Score:2 Normal)
Blarvey
Joined: 11/21/2011
MGoPoints: 182

I think because football and basketball are majority U.S. sports (where baseball and hockey have more international talent pools), and the NCAA has been a very effective cartel for a long time.

January 29th, 2013 at 10:58 PM | BUT, college football existed (Score:1 Normal)
UMxWolverines
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BUT, college football existed before professional football

"Ohio is like a giant turd that Michigan just can't pinch off"

January 30th, 2013 at 1:23 AM | Except that minor league (Score:2)
Yeoman
Joined: 06/08/2011
MGoPoints: 2248

Except that minor league baseball has been around for a very long time, and for most of that time the MLB talent pool was very US-concentrated. There were very few foreign players in MLB before the mid to late-50s, and college baseball had a pretty insignificant share of the pool until the 70s. It's the reverse of what you'd expect from your explanation.

January 30th, 2013 at 8:51 AM | Begs the question (Score:5 Normal)
grumbler
Joined: 08/17/2011
MGoPoints: 132

Your response assumes that college athletes are not capitalizing off their skill sets, as well as assuming that "athletic departments" don't consist mostly of athletes.

No athlete is forced to attend a college.   Colleges offer athletes facilities, coaching, exposure, and an education, in return for which the athlete performs in school-sponsored athletic events, for some of which the school charges admission and sells TV rights.  There isn't some "athletic department" out there swimming in the money thus generated; the money goes back to the coaches, facilities, and education which the student-athlete is receiving.

The idea that schools should take money away from the athletes in order to give money to the athletes is pretty absurd.  This case isn't really about the athletes versus the universities; it is about revenue sport athletes against non-revenue-sport athletes.  If the athletes get a share of TV revenues, then all revenue-sport athletes should also be forced to repay the schools for room, board, and tuition.

January 30th, 2013 at 9:44 AM | While I agree there should be (Score:1)
maizenbluenc
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an alternate route for those not wanting to continue in school (insert your favorite Buckeye example here), I also will ask how much do minor league soccer and baseball players make? Assuming minor league football would be comparable to baseball, then how does that salary compare to a scholarship, room and board, conditioning, etc. and NCAA amatuer gets?

The only person getting screwed in this scenario are the walk-ons, who are presummably attending school for a degree and would like to continue football on their own dime even with a very low odds of seeing game time (or DII/DII players). If there was a minor league football, presummable fewer of the scholarship players would stay amatuer, and some of the walk ons or DII/DIII players who actually value being a student and and athelete would then have scholarships.

January 29th, 2013 at 11:11 PM | Breath.... (Score:2)
HELLE
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and read the entire post. I don't think he was really suggesting to end everything you care about in this world.

Go Blue!

January 30th, 2013 at 12:42 AM | You say that (Score:-1 Flamebait)
January 30th, 2013 at 3:00 AM | Who gets to say what a fair (Score:1)
UMxWolverines
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Who gets to say what a fair wage is though? Money made by the football program goes back into the athletic department to pay for scholarships of the football team plus other sports. I don't know the total cost for the entire football team, but roughly 50 grand a year in total expenses for a normal out of state student is reduced to zero. Multiply that by 4 years and that's $200,000 they didn't have to pay.

"Ohio is like a giant turd that Michigan just can't pinch off"

January 29th, 2013 at 9:32 PM | MGoLawyers? (Score:2 Normal)
will
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NCAA is spinning this as a partial victory, Explain please?

Partial victory in that they didn't receive a summary judgement to give former athletes billions on the spot?

January 29th, 2013 at 9:45 PM | I don't handle class actions, but (Score:5 Normal)
The FannMan
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I don't think this is that big of a deal. It was a ruling on a procedural motion. Pay attention if the class gets certified and the NCAA's Motion for Summary Disposition gets filed.



As for the NCAA's spin, it depends on what the judge said. She could have told the Plaintiffs that she would allow them to amend their complaint, but didn't think the new theory had a lot if merit. It could signal that she would dismiss the case eventually. Or it could just be a lawyer spinning for his client.

"Nobody cares what you think!"

January 30th, 2013 at 1:08 AM | Agree with The FannMan, but a (Score:1)
Maize_in_spartyland
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Agree with The FannMan, but a couple other thoughts . . .

Procedural and substantive are different - Procedural is sort of like getting off based on technicality; substantive is getting to the meat of the issue, if you will. Most, if not all, attorneys will seek to bounce a case procedurally - you avoid having to litigate the case, etc.

Doesn't mean the NCAA can't win, but former players have at least a somewhat viable suit, giving them some leverage to negotiate.

The key issue here is class certification. In many cases, if a judge certifies a class for a class action, more likely than not, the defendants end up settling with the class. That may not be the case here, since there is likely billions on the table. A number of factors go into class certification, one of which includes how the members of the class are or are not similarly situated to one another. For example, how similar (or different) are Ed O'Bannon and Kris Johnson (little used frosh on the 1995 team)? The more the defendants (NCAA) can show that the members do not have common claims that predominate, the less likely the judge would certify the class. Keep in mind, this could (eventually) apply to multiple sports, possibly even sports that do not have video games (or other external revenue streams).

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January 29th, 2013 at 9:32 PM | This is a huge move. But I (Score:2)
Plegerize
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This is a huge move. But I wonder how it all goes down.

I wonder if the NCAA will still have the right to determine how to distribute it to the athletes.

A wise man speaks because he has something to say; a fool because he has to say something. - Plato

January 29th, 2013 at 9:35 PM | (No subject) (Score:3 Normal)
orobs
Joined: 10/03/2010
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January 29th, 2013 at 9:38 PM | So will backup 400 meter (Score:3 Normal)
State Street
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So will backup 400 meter runners on the indoor track team get the same cut as a Heisman winning football player?  How does this work?

January 29th, 2013 at 9:40 PM | Right (Score:3 Normal)
DealerCamel
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I was wondering this as well.  You can't pay just football players and ignore every other sport.  I know football is placed on a higher pedestal than most other things, but that's a step too far.

January 29th, 2013 at 10:16 PM | This would be terrible for (Score:2)
BlueInWisconsin
Joined: 03/27/2009
MGoPoints: 110

This would be terrible for college sports as a whole. It would be the end of a whole lot of Olympic sports programs and probably even football and basketball at a lot of smaller D1 schools. This lawsuit could literally kill the goose that laid the golden egg.

January 29th, 2013 at 11:13 PM | This would definitely hurt (Score:4 Normal)
snarling wolverine
Joined: 12/14/2011
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This would definitely hurt college sports overall, but I don't think it would literally kill golden-egg-laying geese.

January 29th, 2013 at 10:25 PM | Sure you can (Score:1)
cozy200
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If your sport generates zero revenue, your cut of zero... Is zero. NCAA did it to themselves with shit enforcement of conference "rules" aka saban rule etc. We are all engrained with this need for money from a young age, its a free market. Only makes sense that sooner or later cultural norma take over.

Its called a royale with cheese

January 29th, 2013 at 9:54 PM | per the report (Score:3 Normal)
Erik_in_Dayton
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The plaintiffs are just MBB and football players.

It's tough to make predictions, especially about the future. -- Yogi Berra

                         

January 29th, 2013 at 10:28 PM | Class action (Score:5 Normal)
jackrobert
Joined: 07/09/2009
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The plaintiffs are limited to MBB and football players because that is the only plausible way to define the plaintiff class with any hope of getting the case certified as a class action.

Even then, it is going to be difficult to get class cert because the class will consist of players of varying skills, marketability, and accomplishments, and thus arguably the class will not be able to satisfy the legal standard for being granted class treatment.

The present motion appears to be a motion to strike some new allegations that I assume O'Bannon et al. added in an amended complaint.  There are procedural rules about whether and when you can add new allegations, and the NCAA was hoping to strike the new allegations so the plaintiffs would be limited to recovering money only for rebroadcasts, not live broadcasts.  It's a big win for plaintiffs because the potential damages just increased several fold, but the real battle is going to be over class cert.

The NCAA's position against class cert is interesting because I assume they will have to argue that it requires an individualized inquiry to determine each player's value.  If that is true, which certainly seems the case, class treatment is probably not proper because there is not an efficient way to allocate damages between the walk-on benchwarmers (who deserve very little $) and the superstars (who deserve lots).  In arguing this, the NCAA will be conceding that players create value, which is probably not a position they want to be taking post-class cert.

January 30th, 2013 at 1:34 AM | Do they really need to make (Score:2)
Yeoman
Joined: 06/08/2011
MGoPoints: 2248

Do they really need to make that concession, even implicitly?

All they need to establish is that there are some members of the putative class that do not create value, even under the plaintiffs' assumptions about value-creation. If that were the case it would leave two logical possibilities: either

(1) players don't create value, or

(2) some players do but others don't, so that class treatement is improper.

In neither case could plaintiffs win as a class, so there would be no valid argument for certification.

January 30th, 2013 at 11:23 AM | My last sentence wasn't clear (Score:2)
jackrobert
Joined: 07/09/2009
MGoPoints: 84

I was operating on the assumption that class cert would be denied (which is most probably the right ruling), at which point the NCAA would already be on record saying some players create value and some don't.  

My take is that class cert should be denied due to the problem of allocating damages among the class members (there are probably additional reasons for this ruluing).  But California courts - even the federal ones - are notorious for liberally certifying classes.

Even if the class is not certified, however, I think there are enough high value former NCAA athletes to incentivize plaintiffs' attorneys to bring individual suits.  The class action mechanism is there so when we all get overcharged $3 on our ComEd bill for a year, we can bring 1 lawsuit to recover.

Either way, I look forward to the NCAA going down in flames on this one.

January 30th, 2013 at 3:33 PM | What I'm trying to say... (Score:1)
Yeoman
Joined: 06/08/2011
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...is that to make this argument against certification, they only have to claim that some players do not create net value. They don't have to go on record saying that anyone does; establishing that there are players that don't would suffice.

January 29th, 2013 at 10:02 PM | Don't forget about Title IX (Score:2)
stoneblue1817
Joined: 09/27/2010
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how would that work in this. Maybe I should google. durr

January 29th, 2013 at 10:34 PM | What about scholarships? (Score:5 Normal)
gwrock
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If a kid starts getting paid to play football, shouldn't he also start paying for his education just like some kid who works in the cafeteria does?

January 30th, 2013 at 12:45 AM | considering some of them (Score:2 Normal)
ak47
Joined: 05/05/2011
MGoPoints: 601

considering some of them would be making upwards of millions of dollars if they could market themselves and take advantage of sponsorships I think they would take that trade.  Just think how much denard could have made on sponsorships based off his popularity.  

January 30th, 2013 at 1:01 AM | What about the kid at the end (Score:5 Normal)
gwrock
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What about the kid at the end of the bench?  

In general, I don't like where any of this leads.  I suppose I'm still clinging to the quaint notion that a free four-year ride at college is worth something.

January 30th, 2013 at 8:44 AM | Couldn't you make the (Score:2)
bluebyyou
Joined: 09/07/2009
MGoPoints: 2684

Couldn't you make the argument that even the kid at the end of the bench performs a useful function being on the practice squad?  This, as others have already pointed out, does raise the question of relative valuation which, it would seem, would dictate against certiication for class action.  

Think about the disaster in the courts which could result if the class certification were denied, the case proceeds and O'Bannon et al. prevail, Literally thousands of lawsuits could be filed, with each one having to have a hearing on its individual merits.

January 29th, 2013 at 9:41 PM | Question: (Score:1)
justingoblue
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What would it take for the NCAA prohibition against agents to be overturned? I've always thought it was a no-no under US law to prohibit members of an organization from obtaining counsel; is that not the case, or has there just not been an athlete to challenge it yet?

Go Blue!

January 29th, 2013 at 10:40 PM | If I understand it correctly, (Score:3 Interesting)
BOX House
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If I understand it correctly, college athletes are entitled to legal counsel. They can get advice from counsel, but a lawyer becomes an agent for eligibility purposes if the lawyer talks to any pro teams or discusses any potential pro contract on behalf of the athlete. 

Andy Oliver (former(?) Tigers pitcher) sued the NCAA on this issue.

Life and Loss with Michigan Basketball

January 29th, 2013 at 9:43 PM | Correct me if I'm wrong, but couldn't universities (Score:2)
hart20
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just have the athletes waive their rights to claim any compensation that the university receives as a result of the athletes' activities in exchange for the scholarship? Such a contract wouldn't favor the athlete of course, but is it a plausible possibility? 

Yep, that's Simba made out of a pineapple.

January 29th, 2013 at 10:00 PM | gut reaction/not very well thought out reaction (Score:5 Normal)
Erik_in_Dayton
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That could be an unconscionable contract depending on state law.  There could also be some sort of anti-trust issue if you have a situation in which players have a legal right, in a sense, to a share of the pie but are told that they have to give that up to compete, especially when a guy who is one or two years out of high school can't take his talents to the NFL...but I'm not an anti-trust expert by any means.  I am in fact a lemur typing on a computer in a zoo.

It's tough to make predictions, especially about the future. -- Yogi Berra

                         

January 29th, 2013 at 9:43 PM | Mark Emmert's legacy will not (Score:0 Offtopic)
January 29th, 2013 at 10:14 PM | In fairness to Emmert, it's (Score:3 Normal)
Callahan
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In fairness to Emmert, it's not like he started the false amateurism scheme.

January 29th, 2013 at 10:15 PM | Fault or not, some pretty bad (Score:1 Normal)
TheGhostofYost
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Fault or not, some pretty bad things have happened under his watch.  

January 29th, 2013 at 9:52 PM | Comments (Score:2 Normal)
smwilliams
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The interesting thing about the O'Bannon lawsuit is that it began as a way for college athletes to be compensated for their likenesses being used in such things as jersey sales, video games, etc.

The NCAA basically told them to f off. Now, it could cost them a lot more and it wouldn't be coming from EA Sports and the like.

It certainly should be a fascinating case if the suit is indeed certified. Ed O'Bannon could go down as a lot more than the best player on a NCAA-title team.

 

January 29th, 2013 at 9:53 PM | If the NCAA is liable for (Score:2 Normal)
Blarvey
Joined: 11/21/2011
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If the NCAA is liable for hundreds of millions or billions of dollars, what choices would they have? As a nonprofit that has kind of made it all up as it goes along, they may have some cash laying around but I don't see why schools would feel any need to be members of it. The schools and conferences would be better off dealing directly with the networks and establish playoffs. And if the NCAA ceases to exist, doesn't something else have to take its place?

January 29th, 2013 at 10:10 PM | Crazy sh*t, huh!  It's how we (Score:1)
B-Nut-GoBlue
Joined: 09/30/2011
MGoPoints: 1686

Crazy sh*t, huh!  It's how we operate as a society, I know -in how we just go with the flow and ask a few questions but never really delve too deep into "issues" and we just let things happen because that's how it's always been, etc.- but here's a case, literally, where if pushed far enough there are some big changes to come.  We've always just let the NCAA be the de facto head of amatuer sports.  But really, what damn good does it do in this day in age?  And now, with this case growing and blossoming into something bigger than it set out to be, we really are starting to question why this organization is allowed to be what it is along with questioning, in a way, human "rights" (not to make it too dramatic, but people not being paid while a department does make money off of said people is a bit of a "rights" thing).

January 29th, 2013 at 10:26 PM | Let's face it: the NCAA is (Score:5 Normal)
Callahan
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Let's face it: the NCAA is and has always been an antitrust disaster that's gotten by only because any lawsuit challenging the system would almost certainly extend beyond the plaintiff's career and become moot. The O'Bannon lawsuit originally only was for the videogame likenesses. That was minor compared to the television revenue.

But here's a question: say they are forced to split up thr BCS money. It naturally follows that theyd have to split cable revenues as well. Would it mean the end of the NCAA? Probably not. But it would mean the end of shamateurism, and the onslaught of massive hi def video boards for a baseball team that plays before sparse crowds.

January 29th, 2013 at 10:35 PM | The unintended consequences of this mess should make (Score:3 Funny)
LB
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the jersey color a moot point.

May you have a strong foundation
When the winds of changes shift

January 29th, 2013 at 11:07 PM | So (Score:2 Interesting)
Center Ice
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I'm trying to understand how this would affect the college hockey world. If an NCAA hockey player is allowed to receive money, then that should mean a CHL player who would want to come play college hockey should be able too, correct?

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January 29th, 2013 at 11:25 PM | Death Of The Scholarship (Score:1)
gsot21
Joined: 01/26/2013
MGoPoints: 88

What if they went to a system and this would only work for football and basketball, where there is no scholarships and it is a performance system, where you get lets say $2000 for starting a game, $10000 for being all big ten, $15000 for winning the big ten, ect.

All of this money would go to the individual players tuition, so lets say all the player does for one year is start one game which is worth $2000, and tuition is $20000, so they would only owe $18000 for that year. Now tuition would be averaged between all the colleges for a conference.

This would allow players who are of high value to a university like Denard to make some money and would give the players a chance to make money if the incentives are set at right prices.

Anyone else think this would work? And how would the SEC manipulate it.

My spelling sucks. 

January 29th, 2013 at 11:34 PM | ed o bannon is a baby (Score:-1 Flamebait)
January 29th, 2013 at 11:46 PM | If I remember the cover of (Score:5 Normal)
trueblueintexas
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If I remember the cover of NCAA Basketball correctly, it was an actual picture of O'Bannon on the cover. Just like all of the covers. That's why he originally started this, basically he was not able to say no to his actual picture being used even though he was already graduated from college.
I agree with your sentiments about O'Bannon on the whole, but his original complaint was legit.

"Anyone who isn't confused, really doesn't understand the situation." - Edward R. Murrow

January 30th, 2013 at 3:12 AM | Just a word of advice (Score:2 Insightful)
Center Ice
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You're new here. If you don't use proper spelling and grammar on this site, all of your posts will be downvoted by other users.

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January 29th, 2013 at 11:42 PM | colleg players get enough (Score:-1 Flamebait)
January 30th, 2013 at 12:11 AM | IANAL (Score:1)
Jon06
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I'm pretty sure it's illegal for a company not to pay you if they are profiting off of, rather than providing educational experiences for, their interns. See, e.g., http://www.nytimes.com/2010/04/03/business/03intern.html?pagewanted=all

That people deserve to get a cut when others are making money off their labor is a principle enshrined in the law.

RIP my avatar, June 14, 1998 - October 26, 2012.

January 30th, 2013 at 12:19 AM | Your skill set is not as (Score:3 Normal)
icactus
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Your skill set is not as monetarily  valuable.

 

Better luck next time.

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