The lawsuit brought by former UCLA basketball star Ed O’Bannon has many commentators condemning major college sports and predicting the demise of the NCAA. They’re wrong, at least about the second point. In fact the NCAA will almost certainly win the case, thanks to a 30-year-old U.S. Supreme Court precedent.
O’Bannon is the lead plaintiff in a class action claiming that current and former athletes like himself should be paid when their images are used, for example, in telecasts of games. The case raises questions about amateurism, which is difficult to define in the best of circumstances but particularly in the context of collegiate football and men’s basketball. Those sports generate billions of dollars in revenue for their schools, pay coaches in the millions and take place in venues that cost hundreds of millions. The players who sued are essentially asking for a share of that revenue.
While theoretical questions about amateurism may be difficult to answer, the most important legal questions were settled in a 1984 case between the NCAA and the University of Oklahoma. In that case the Supreme Court set out some principles that should guarantee victory for the NCAA in the O’Bannon lawsuit, if not at trial then on appeal.
The precedent could not be clearer. Identifying the “product” of college sports as athletics associated with an academic tradition, the Supreme Court unequivocally stated that “in order to preserve the character and quality of the ‘product,’ athletes must not be paid, must be required to attend class, and the like.” Although in 1984 the more than 1,200 NCAA schools were generating millions rather than billions, the point remains valid. Indeed, the Supreme Court in 1984 recognized that the “NCAA and its member institutions are in fact organized to maximize revenues.”
That profit motive, however, does not compel payment of student-athletes. The reverse is true, because paying student-athletes would eliminate the academic tradition that, according to the 1984 Supreme Court, “differentiates college football from and makes it more popular than professional sports to which it might otherwise be comparable, such as, for example, minor league baseball.”
Whether one agrees with this reasoning, it is a judicial precedent on which the entire edifice of college sports—both revenue-generating and non-revenue-generating sports—has been built in the last three decades. To destroy that edifice would benefit no one except the less than one percent of college athletes who are skilled enough to play professionally.
The trial judge in the O’Bannon case has ignored this precedent so far. But I expect that at the least it will be followed on appeal if the NCAA loses at trial, which is currently awaiting a verdict from the judge.
A recent sports law case with an even older Supreme Court precedent illustrates the point. In that case, the city of San Jose, Calif. sued Major League Baseball for not permitting the Oakland Athletics to re-locate to San Jose.
That case was dismissed because of a Supreme Court case decided nearly a hundred years ago—a case that appears outdated and incorrect today. The 1922 ruling held that Major League Baseball was not involved in interstate commerce, and therefore was immune from antitrust lawsuits. Although it seems obvious now that Major League Baseball engages in interstate commerce, the trial court judge in the San Jose case felt—correctly—that he did not have the power to overturn a Supreme Court precedent. He dismissed the case, which is now on appeal.
The 1922 precedent, however, served an important purpose: it gave Major League Baseball the right to organize itself based on this precedent, resulting in a massive, successful enterprise. This is the precise reason why we have a legal system based on precedent—so that citizens can organize their affairs with some legal certainty.
That is why ultimately the NCAA will survive the O’Bannon lawsuit and other lawsuits that have been filed against it claiming that student-athletes should be paid. Putting aside the practical and legal problems of paying student-athletes, it makes no sense to drastically change a system that is based on a Supreme Court precedent and that is supported by the more than 1,200 schools that are members of the NCAA. As the Supreme Court said in 1984, the NCAA is the “guardian of an important American tradition.” Although, like many institutions, the NCAA is not free of hypocrisy, that’s no reason to dismantle a tradition that is cherished by tens of millions of Americans.
