The Forgotten Party in O'Bannon v. National Collegiate Athletic Association: How Non-Revenue Sports Operate in a Changing Intercollegiate Marketplace

Author:Dillon J. Besser
Position:J.D. Candidate, The University of Iowa College of Law, 2016; B.A., William Jewell College, 2013
Pages:2105-2140
SUMMARY

The O'Bannon v. National Collegiate Athletic Association litigation has put the financial landscape and future of intercollegiate sports at a monumental crossroads. The U.S. district court granted Division I men's basketball and football players remedies due to antitrust violation by the National Collegiate Athletic Association ("NCAA"). On appeal, the Ninth Circuit affirmed that NCAA must pass... (see full summary)

 
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2105
The Forgotten Party in O’Bannon v.
National Collegiate Athletic Association: How
Non-Revenue Sports Operate in a
Changing Intercollegiate Marketplace
Dillon J. Besser*
ABSTRACT: The O’Bannon v. National Collegiate Athletic
Association litigation has put the financial landscape and future of
intercollegiate sports at a monumental crossroads. The U.S. district court
granted Division I men’s basketball and football players remedies due to
antitrust violation by the National Collegiate Athletic Association (“NCAA”).
On appeal, the Ninth Circuit affirmed that NCAA must pass antitrust
scrutiny and accepted one of the district court’s remedies. Other reforms,
including the NCAA’s decision to grant the Power Five Conferences more
autonomy, have made clear that the “Principle of Amateuri sm” needs to be
revisited for college athletes. The vast majority of athletes, those in “non-
revenue” sports, do not have a clear place in this reform. Those in a position
of reform should account for these interests to reach the best solution for the
future of intercollegiate athletics. This Note proposes three possible routes that
fit the changing times for student-athletes and their compensation for their
athletic services. First, without other intervention, changes to college athletics
could lead to a free market employeremployee relationship between student-
athletes and the institutions. Second, government intervention could help
stabilize what lies ahead in college athletics. Lastly, and what this Note argues
to be the most appropriate, member institutions should embrace cost-of-
attendance scholarships, and the NCAA should reform its bylaws to allow
student-athletes to receive compensation for their name, image and likeness.
The NCAA bylaw reform should rethink the “Principle of Amateurism” and
allow athlete-agent interaction for the benefit of “indirect financial activity.”
*
J.D. Candidate, The University of Iowa College of Law, 2016; B.A., William Jewell
College, 2013. Thank you to the staff of Volumes 100 and 101 of the Iowa Law Review for the
great experience. Thank you to Jay Bilas (and to my friend Nick Schwerdt for providing the
connection), Dr. Darlene Bailey, and Professor Herbert Hovenkamp for taking the time to help
with my research. And finally, thank you to my family for their amazing encouragement
throughout the years.
2106 IOWA LAW REVIEW [Vol. 101:2105
I. INTRODUCTION ........................................................................... 2106
II. HOW AMERICA ARRIVED AT TODAYS INTERCOLLEGIATE
ATHLETICS STRUCTURE .............................................................. 2110
A. COLLEGE ATHLETICS AND THE ORIGINS OF THE NCAA ........... 2111
B. COLLEGE SPORTS BECOMES BIG BUSINESS .............................. 2113
C. TITLE IX AND OTHER GOVERNMENT INVOLVEMENT IN COLLEGE
SPORTS ................................................................................. 2114
D. ADDITIONAL STUDENT-ATHLETES RIGHTS LITIGATION .......... 2116
E. THE BATTLE FOR STUDENT-ATHLETE COMPENSATION:
O’BANNON .......................................................................... 2117
III. THE NINTH CIRCUIT DECISION, POWER CONFERENCE SHIFTS
AND WHAT IS AHEAD ................................................................... 2120
A. THE NINTH CIRCUITS O’BANNON DECISION ........................ 2121
B. THE EFFECTS OF O’BANNON AND OTHER SIGNIFICANT
CHANGES .............................................................................. 2123
C. DANGERS FOR THE “FORGOTTEN SPORTS ............................... 2126
IV. NON-REVENUE SPORTS PATHS TO SURVIVAL .............................. 2129
A. THE LAISSEZ-FAIRE APPROACH .............................................. 2129
B. THE GOVERNMENT INTERVENTION APPROACH ....................... 2133
C. NCAA FINANCIAL GOVERNANCE: 21ST-CENTURY APPROACH .. 2136
1. Implementation of Cost-of-Attendance
Scholarships ................................................................. 2137
2. NCAA Bylaw Reform to Allow Student Access to NIL
Revenues ...................................................................... 2138
V. CONCLUSION .............................................................................. 2140
I. INTRODUCTION
College sports and American culture are intertwined. Approximately
420,000 young adults in about 1000 member institutions are now a part of
the National Collegiate Athletic Association (“NCAA”).1 While most “will be
going pro in something other than sports,”2 no one can deny the impact that
collegiate athletics have on students. Countless students have needed non-
revenue intercollegiate sports to “make it.”
1. NCAA College Athletics Statistics, STAT. BRAIN RES. INST., http://www.statisticbrain.com/
ncaa-college-athletics-statistics/ (last visited May 16, 2016) (providing information verified as of May
16, 2016).
2. NCAA, NCAA Commercial Spot: Going Pro in Something Other than Sport (Bourse Sportive USA),
YOUTUBE (Jan. 29, 2013), https://www.youtube.com/watch?v=CXeDUFTaU1Y.
2016] THE FORGOTTEN PARTY 2107
One example comes from William Jewell College, a small but well-
respected liberal arts institution in Liberty, Missouri.3 William Jewell Athletic
Director Darlene Bailey recounted the story of a student-athlete who
graduated in December 2014.4 School-sponsored athletics are not often the
reason that an individual ends up at a school like William Jewell, which
competes in the NCAA’s Division II.5 Yet this particular student-athlete came
to the school after being discarded from a larger university due to
underwhelming grades and lack of playing time.6 The coaching staff for this
young man’s non-revenue producing sport at William Jewell gave him another
shot at higher education, supplemented by an athletic scholarship.7 He
struggled through poor grades his first year but wanted to be there because
he was getting the chance to play college sports.8 The coaching staff and Dr.
Bailey took care to ensure that he was not forgotten in the highly academic
environment.9 The young man seized the opportunity and remained eligible
every semester.10 After completing a strong student-athlete career, this
student-athlete will realize the prize of a college degree.11 This would not have
happened without college athletic programs for non-revenue sports and
scholarships that draw individuals to a school like William Jewell.
The NCAA has become big business.12 Yet the value for the “forgotten”
athletes—those not seen on ESPN every Saturday in the fall or at the men’s
basketball tournament every March—is comprised completely of the
3. See About Jewell, WM. JEWELL C., https://www.jewell.edu/about-jewell (last visited May 16,
2016) (“Consistently ranked among America’s best colleges in U.S. News & World Report, Forbes,
The Princeton Review, Washington Monthly, and Kiplinger’s Personal Finance, Jewell is cited for small
class sizes, low student debt, high graduation rates, commitment to service and overall value.”).
4. Telephone Interview with Darlene Bailey, Athletic Dir., William Jewell Coll. (Oct. 17, 2014).
5. See About NCAA Division II, NCAA, http://www.ncaa.org/about?division=d2 (last visited
May 16, 2016) (“[I]nstitutions in Division II generally don’t hav e the financial resources to devote
to their athletics programs or choose not to place such a heavy financial emphasis on them.”).
6. Telephone Interview with Darlene Bailey, supra note 4.
7. Id.
8. Id.
9. Id.
10. Id.
11. Id.
12. Big business and college sports now go hand in hand. Television money for both men’s
Division I basketball and FBS football has skyrocketed. The NCAA is in the middle of a 14-year March
Madness (men’s basketball tournament) television contract with CBS and Turner Broadcasting that is
worth $11 billion. Chris Smith, The Most Valuable Conferences in College Sports 2014, FORBES (Apr. 15,
2014, 2:49 PM), http://www.forbes.com/sites/chrissmith/2014/04/15/the-most-valuable-conf
erences-in-college-sports-2014. Additionally, the television contracts each Power Five Conference (Big
Ten, Big 12, Pac-12, Southeastern Conference (“SEC”) and Atlantic Coast Conference (“ACC”))
receives for football are enormous. For example, the SEC’s new network contract is reported to have a
payout to each team of $34 million annually starting with the 2014–2015 season. Steve Berkowitz, SEC
Revenue Set to Jump 50% with Playoff, New TV Deals, USA TODAY (Jan. 16, 2013, 9:23 PM),
http://www.usatoday.com/story/sports/college/2013/01/16/sec-conference-money increases
/1836389.

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