A Prelude to Jenkins v. NCAA: Amateurism, Antitrust Law, and the Role of Consumer Demand in a Proper Rule of Reason Analysis

Author:Marc Edelman
Position:Professor Marc Edelman (Marc@MarcEdelman.com) is a tenured Professor of Law at the Zicklin School of Business, Baruch College, City University of New York. He is also a summer adjunct professor at Fordham University School of Law and a columnist for Forbes SportsMoney. Professor Edelman advises numerous businesses on legal issues related to...
Pages:227-244
 
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A Prelude to Jenkins v. NCAA: Amateurism, Antitrust
Law, and the Role of Consumer Demand in a Proper
Rule of Reason Analysis
Marc Edelman
TABLE OF CONTENTS
Introduction .................................................................................. 228
I. The Current Landscape of Big-Time College Sports ................... 229
II. Challenging NCAA “No Pay” Rules Under the Sherman Act ..... 231
A. An Introduction to Section 1 of the Sherman Act.................. 231
1. Antitrust Basics ............................................................... 231
2. Applying Section 1 of the Sherman Act to the
NCAA’s No Pay Rules .................................................... 233
B. O’Bannon v. National Collegiate Athletic Association ......... 234
1. Case Overview ................................................................ 235
2. Bench Trial and District Court Decision ......................... 236
3. Appellate Court Decision ................................................ 237
C. Jenkins v. NCAA .................................................................... 238
1. Case Overview ................................................................ 239
2. Why Jenkins May Prove a Game Changer for
College Athletes’ Rights ................................................. 241
III. What It Would Take for College Athletes Truly to Prevail
in Jenkins v. NCAA ....................................................................... 242
Conclusion .................................................................................... 244
Copyright 2017, by MARC EDELMAN.
Professor Marc Edelman (Marc@MarcEdelman.com) is a tenured
Professor of Law at t he Zicklin School of Business, Baruch College, City
University of New York. He is also a summer adjunct professor at Ford ham
University School of Law and a columnist for Forbes SportsMoney. Professor
Edelman advises numerous businesses on legal issues related to antitrust, gaming,
intellectual property, and sports law.
228 LOUISIANA LAW REVIEW [Vol. 78
INTRODUCTION
On September 30, 2015, the United States Court of Appeals for the Ninth
Circuit held in O’Bannon v. National Collegiate Athletic Association that the
National Collegiate Athletic Association (“NCAA”) violated Section 1 of the
Sherman Act by prohibiting member colleges from offering their athletes
compensation equal to the full cost of their college attendance.1 Nevertheless,
the O’Bannon decision failed to enjoin the NCAA from maintaining its rules
that prevent colleges from paying their athletes directly in cash or with
additional in-kind benefits.2
At present, the antitrust status of the NCAA’s “no pay” rules again are
the subject of legal challenge in Jenkins v. National Collegiate Athletic
Associationa lawsuit that seeks to further overturn the NCAA’s
amateurism rules that “plac[e] a ceiling on the compensation that may be paid
to [college] athletes for their services.”3 Although the NCAA has claimed that
1. O’Bannon v. NCAA, 802 F.3d 1049, 1079 (9th Cir. 2015) (“Today, we
reaffirm that NCAA regulations are subject to antitrust scrutiny and must be tested
in the crucible of the Rule of Reason.”). Although the NCAA had long purported
in its public relations materials and media that it allowed colleges to provide
athletes with scholarships to cover the cost of their education, until the O’Bannon
ruling, the NCAA’s maximum scholarship levels maintained a several thousand dollar
per year shortfall between the maximum amount of athletic scholarship money
permissible under NCAA rules and the true cost of a student-athlete attending college.
See Free Ride Still Costs Athletes, ESPN (Oct. 26, 2010), http://www.espn.com
/college-sports/news/story?id=5728653 [https://perma.cc/VK2A-PMDQ]; see also
Study: College Athletes Worth Six Figures Live Below the Poverty Line, DREXEL
NOW (Sept. 13, 2011), http://drexel.edu/now/archive/2011/September/Study-Col
lege-Athletes-Worth-Six-Figures-Live-Below-Federal-Poverty-Line (explaining that
a study entitled “The Price of Poverty in Big Time College Sport” shows that the
average scholarship shortfall per college athlete during the 20102011 school year
was $3,222 per athlete) [https://perma.cc/TY3Y-5UB6]; Ed Payne, Report: College
Scholarship Athletes are Living in P overty, CNN (Sept. 13, 2011), http://edi
tion.cnn.com/2011/SPORT/09/13/full.scholarships (also citing to the annual average
student-athlete out of pocket expense of $3,222 per year) [https://perma.cc/BD2U-
5ACE]. Although this amount is defined as a “full grant-in-aid,” it does not include
money to cover the costs of all meals, travel to and home from college, basic living
expenses, or even books marked as recommended reading by the student-athletes’
professors; see also Complaint at 3, Jenkins v. NCAA, No. 14-cv-01678 (D.N.J. Mar.
17, 2014) (“[U]nder NCAA and Power Conference Rules, players may receive only
tuition, required institutional fees, room and board, and required course-related
books in exchange for their services.”).
2. O’Ban non, 802 F.3d at 1076.
3. Complaint, supra note 1, at 12; see also O’Bannon v. NCAA, 7 F. Supp. 3d
955, 974–75 (N.D.Cal. 2014) (“The amateurism provision in the NCAA’s current

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