The Washington Monthly - Supreme Court Affirms Limited Win for College Athletes But Helps Monopolies

Sandeep Vaheesan publishes a piece about how the NCAA case set back antitrust law.

This week, the Supreme Court gave college basketball and football players a modest victory over the National Collegiate Athletic Association but one that, in the long run, may make life harder for proponents of vigorous antitrust against dominant corporations.

The Court, in a unanimous decision authored by Justice Neil Gorsuch, upheld a lower court ruling that invalidated the NCAA’s prohibition on education-related benefits to athletes. Despite the headlines declaring a defeat for the NCAA, the Court only affirmed a limited win for college athletes. It did not strike down the NCAA’s prohibition on paying a salary to players who generate billions for their colleges and universities.

In its ruling in NCAA v. Alston, the Court rejected the NCAA’s pleas for lenient antitrust treatment or an outright antitrust immunity. The NCAA asserted that a 1984 Supreme Court decision, which invalidated NCAA rules on television broadcasts, immunized its rules on capping player compensation because the Court noted the “revered tradition of amateurism in college sports.” The NCAA also claimed that it and its member schools are not “commercial enterprises.” These arguments gained no traction, and the Court ruled that the granting of antitrust immunities is the province of Congress, not the judiciary.

The Court, however, declined to revisit the trial court’s analysis that robbed the players of a complete victory against the NCAA. Although the players sought an end to NCAA’s collusive prohibition on player compensation, Judge Claudia Wilken, following a bench trial, struck down only the NCAA’s rules on education-related payments. In preserving the NCAA’s general prohibition on paying players, she concluded that some viewers may watch and attend college basketball and football games because the players are not paid like professionals. In its amicus briefs in support of the players in the Ninth Circuit and Supreme Court, the Open Markets Institute, where I work, argued that this “cross-market” balancing of harm to workers against benefits to consumers (whether theoretical or real) is bad law and bad policy.

The Court, however, declined to squarely address this issue because the players and their counsel gave it an easy out. The opinion stated that “the student-athletes do not question that the NCAA may permissibly seek to justify its restraints in the labor market by pointing to procompetitive effects they produce in the consumer market.” Although the Court punted on this question, law professor John Newman noted that the Court approved of Judge Wilken’s analysis and so appeared to implicitly bless such balancing.

Read the full article on The Washington Monthly here.