Cheaters, not criminals: antitrust invalidation of statutes outlawing sports agent recruitment of student athletes.

• Author: Bascuas, Ricardo J.

Las Vegas businessman Raul Bey agreed in February 1995 to spend one year in a Florida prison, pay a $2000 fine, and reimburse the state for $10,000 in investigative costs. The crime to which he pled no contest: failing to register as a sports agent.(1) At the time, Florida law made being or attempting to become the representative of a student athlete without first registering with the state a third-degree felony punishable by a $5000 fine and five years in jail.(2) According to the statute's preamble, criminalizing sports agent conduct serves to "protect the interests of student athletes and academic institutions by regulating the activities of athlete agents."(3) The events leading to Bey's arrest, however, suggest the law has a considerably less noble purpose and less farreaching effect.

Hoping to secure product endorsements and representation agreements from college athletes, Bey had teamed up with Nate Cebrun, a man in the business of referring athletes to sports agents for a commission.(4) Bankrolled by Bey, Cebrun traveled to Florida State University (FSU) in Tallahassee in October 1993, lavishing cash on FSU players and promising them decadent trips to Las Vegas.(5) Having captured the attention of some of the Seminoles, Cebrun returned to Las Vegas, leaving Paul Williams, a former Tallahassee high school football coach acquainted with some FSU players, to distribute more money among those who had expressed an interest in Cebrun's overtures.(6)

Cebrun returned to Florida State with Bey in November to make grander gestures and promises. On one such trip, they passed out hundred-dollar bills and promised a regular allowance to those who would agree to accept their agent referrals.(7) Another incident--one that remains infamous--captured headlines and turned the pair's recruitment campaign into a national scandal. Apparently at Cebrun's behest, he and Bey took a group of FSU players to a Foot Locker store just as the store was to close. With only Bey, Cebrun, and the players behind the locked doors, the players grabbed shoes, hats, jackets, shirts, and anything else they wanted--$6000 worth of merchandise in all. Bey footed the bill and later treated some of the athletes to a $600 dinner.(8) Shortly thereafter, Bey and Cebrun had a falling-out, and the players lost all interest. Bey was left with nothing to show for the $60,000 he claims to have spent on the recruitment effort.(9)

To someone unfamiliar with the mores of American college sports, Bey's plan might seem to be a sensible business strategy, though perhaps one lacking in taste. Among followers of National Collegiate Athletic Association (NCAA) sports, however, such actions carry a serious stigma. Universities and colleges that belong to the NCAA must disqualify student athletes who accept gifts or sign representation contracts with sports agents.(10) The "Foot Locker scandal" was trumpeted by the national media as representative of the corruption of college football and the greed of agents and players.(11) FSU athletic director Bob Goin cast the athletes and the university as victims of "`the sleazebags who filter onto our campus.'"(12) Head coach Bobby Bowden, emphasizing his staff's impotence to prevent gifts to players, added, "`If your daddy's running around on his wife, she's the last one to find out. What do you expect us to do?'"(13) Prompted by the sensational attention being paid the incident, rival University of Florida coach Steve Spurrier quipped that FSU "`is now known as Free Shoes University.'"(14)

As Bey and other would-be sports agents have learned, attempting to recruit student athletes not only generates bad publicity, it is also illegal in twenty-one states. This Note argues that state laws criminalizing contact between student athletes and sports agents are invalid under the Sherman Antitrust Act and undermine the professed goals of the NCAA. Part I describes the structure and policies of the NCAA. Part II illustrates the prevalence and the consequences of violations of the NCAA rule against student athletes dealing with sport agents. Part Ill reviews the various state laws punishing sports agents for trying to recruit student athletes and questions the laws' underlying rationale. Part IV traces the interaction between federal antitrust law and state law and examines two independent grounds on which the state laws restricting contact between athletes and agents can be invalidated. This Note does not argue that under the Sherman Act states lack the power to regulate sports agents. It argues only that states may not legally criminalize the acts of consenting adults seeking to execute mutually beneficial representation agreements simply because they violate the rules of the NCAA.

1. The NCAA

   Like most universities competing in intercollegiate athletics, Florida State is a member of the NCAA, which is responsible for overseeing athletic competitions among its member institutions. As of December 1994, the NCAA had 1152 members, 246 of which were conferences and 906 of which were universities and colleges (member institutions).(15) The members are grouped into three divisions according to the number of athletes a university fields, the number of sports it sponsors, the number of games it plays, and the financial aid it awards athletes.(16) Of the member institutions, 302 (33%) were classified as Division I; 247 (27%) comprised Division II; and 357 (39%) were in Division III.(17) Division I schools, such as Florida State, typically field the most competitive teams.

   The self-proclaimed "basic purpose" of the NCAA is "to maintain intercollegiate athletics as an integral part of the educational program and the athlete as an integral part of the student body and, by so doing, retain a clear line of demarcation between intercollegiate athletics and professional Sports."(18) Accordingly, it promulgates rules governing virtually all aspects of competition among its members. The NCAA Constitution and Bylaws delineate with great specificity the qualifications student athletes must meet to remain eligible to compete and the requirements member institutions must fulfill to remain in good standing. The NCAA can enforce its rules only against member institutions. When it determines an athlete is ineligible for competition, it directs the athlete's school to suspend him from play. Member institutions that violate NCAA rules or directives can be fined, forced to forfeit past victories, or have their recruiting activities curtailed.(19) In cases of flagrant or repeated violations, a university is subject to several stricter penalties, including a two-year ban from competing in a sport altogether(20)--the so-called "death penalty."

   The NCAA rules governing student athletes are meant to ensure that only those who meet the NCAA definition of "student athlete" compete: "An amateur student athlete is one who engages in a particular sport for the educational, physical, mental and social benefits derived therefrom and for whom participation in that sport is an avocation."(21) Student athletes must be enrolled full-time in a curriculum leading to a degree and must make regular progress toward that degree.(22) They may not receive money or aid in excess of the total cost of tuition, fees, books, room, and board from virtually any source--including, in the case of Division I players, off-campus employment.(23) An NCAA football player who joins the National Football League (NFL) draft irrevocably loses his amateur status and thus becomes ineligible to compete in NCAA football, whether or not he is drafted.(24) The "no-agent rule" prohibits players from accepting money or gifts from sports agents and from entering into representation agreements.(25)

   Despite these rules and the NCAA's repeated assertions, several commentators have questioned whether the revenue-producing college sports--particularly football--are in any sense amateur or educational.(26) NCAA sports have undeniable commercial aspects and appeal. Division I sports alone enjoyed well over $1.5 billion in revenue during the 1992-93 fiscal year.(27) The total revenues for all three divisions were more than $2 billion.(28) Among the 106 member institutions with the most competitive athletic programs--those in Division I-A--football accounted on average for 67% of the revenue from men's sports. (29) "Glorified men at arms, they go abroad, the fighting men of their universities, bringing to it, if they have been well scouted, garnered and trained, fame, honor, and money galore. If they have not been, no fame, no honor, and a much smaller portion of the gate receipts."(30)

   Not only is NCAA football a prosperous industry, but it provides the only practical forum for a football player hoping to play professionally to showcase and develop his talent. Only two of the 1279 players on NFL team rosters at the start of the 1994 season did not play for an NCAA institution.(31) Most of the other players attended Division I schools, whose athletes (not surprisingly) commit most violations of the no-agent rule.(32) One would expect, then, that at least some athletes play NCAA football in the hope that doing so will lead to a professional contract.

   The NCAA professes that this is not, or should not be, so: "Student athletes shall be amateurs in an intercollegiate sport, and their participation should be motivated primarily by education and by the physical, mental and social benefits to be derived."(33) The NCAA's emphasis on the education of student athletes protects its amateurism and eligibility rules from legal challenges, such as federal antitrust claims, that might otherwise result in their nullification.(34) It is curious, then, that the three NCAA divisions utilize disparate methods for gauging their athletes' scholastic ambitions. Divisions I and II have established lax minimum academic requirements for prospective and current student athletes. (35) Rather than ensuring that athletes...