Supreme Court Rules against NCAA in class-action benefits case, and NIL meeting set for later this week

In a 9-0 decision handed down mid-Monday morning, the Supreme Court of the United States (SCOTUS) unanimously ruled against the NCAA’s limits on education-related perks for college athletes in the case National Collegiate Athletic Association v. Alston et al. The ruling upheld the decisions of the lower courts, striking down education-related restrictions the NCAA had in place for student-athletes.

Judge Claudia Ann Wilken of the United States District Court for the Northern District of California had previously narrowly ruled against the NCAA on the same grounds SCOTUS upheld today. Judge Wilken agreed with the NCAA about direct compensation for student-athletes. However, she struck down provisions prohibiting enhanced education benefits, ruling they were fair game for member schools to provide even though the NCAA’s argument was such benefits would set up a bidding war between universities and athletic conferences for top athletes. The U.S. Ninth Circuit Court upheld the District Court ruling last May.

Associate Justice Neil M. Gorsuch wrote the majority opinion for SCOTUS, while Associate Justice Brett Kavanaugh wrote a concurring opinion. The case originated as a class action lawsuit against the NCAA filed by former West Virginia running back Shawne Alston and former University of California center Justine Hartman, representing other former men’s and women’s student-athletes.

Justice Gorsuch wrote that Judge Wilkin’s original decision “stands on firm ground — an exhaustive factual record, a thoughtful legal analysis consistent with established antitrust principles, and a healthy dose of judicial humility.”

The decision handed down does not allow for outright compensation to student-athletes, or toss out the “amateur” model, either. However, it does allow college and universities to offer even greater financial and other benefits that are directly tied to education moving forward. This means a school could try to find a competitive advantage in recruiting student-athletes with promises such as scholarships for graduate or vocational schools, graduate internships, new laptops or other computer equipment related to education, study-abroad programs, and even potentially small cash awards for student-athletes who do well in the classroom.

The ruling also has no impact on the ongoing Name, Image, Likeness (NIL) debate going on in the United State Congress, numerous state capitals across the country, and in the NCAA and member institutions. The NCAA is scheduled to meet later this week to work on NIL reforms after twice punting on the issue so far this year and with a number of states set to have NIL laws go into effect on July 1 next week.

However, for now the final paragraph of Gorsuch’s opinion seems a fitting note to finish with in terms of the scope of the ruling and purview SCOTUS had in its authority for review of the case (emphasis added):

Some will think the district court did not go far enough. By permitting colleges and universities to offer enhanced education-related benefits, its decision may encourage scholastic achievement and allow student-athletes a measure of compensation more consistent with the value they bring to their schools. Still, some will see this as a poor substitute for fuller relief. At the same time, others will think the district court went too far by undervaluing the social benefits associated with amateur athletics. For our part, though, we can only agree with the Ninth Circuit: “‘The national debate about amateurism in college sports is important. But our task as appellate judges is not to resolve it. Nor could we. Our task is simply to review the district court judgment through the appropriate lens of antitrust law.’” 958 F. 3d, at 1265. That review persuades us the district court acted within the law’s bounds.

The judgement is affirmed.

NCAA Holding NIL Meeting This Week

Separately from the SCOTUS ruling this morning, the NCAA is set to meet again this week to once again consider NIL rule changes. If you don’t recall my breakdown from last month on NIL, be sure to check it out here. As mentioned in it, this week marks the NCAA’s next meeting, where the council will consider possible changes.

With the upcoming decision by the Division I Council this week, a number of college conferences are reportedly jockeying for dumping the proposal the NCAA was set to consider. A group of six conferences consisting of the SEC, ACC, Pac-12, Sun Belt, SWAC, and MAAC want the NCAA to take a more hands-off approach with NIL. Individual schools would be responsible for enforcing NIL rules, and schools in states where NIL laws exist will adhere to those rules, while schools in states without NIL will have the opportunity to use NCAA NIL rules.

It may also happen that the NCAA again punts on the issue into next month, despite six states having NIL laws taking effect next Thursday, July 1. With such different rule proposals being lobbied suddenly, it may also be in the interest of everyone to wait until next month and allow more time to consider alternative ideas. It would also allow more time for a bipartisan national bill to take shape, but if you are a betting person, the likelihood of a breakthrough on talks on the topic happening between now and the end of July, let alone an actual bill coming out of it and sailing through both chambers, is about as likely as Jim Harbaugh winning a national title at Michigan in his first six years as head coach in Ann Arbor.