A 74-year-old judge’s decision to convert college sports to a professional sports model, with players paid to play, salary caps, and other features that would blur the line between the pros and the university will determine the future of college sports.
Do n’t expect U. S. District Judge Claudia Wilken to instantly grant approval.
In reality, there’s a genuine possibility she could accept the offer.
Wilken likely wo n’t review the NCAA’s settlement of the House, Carter &, and Hubbard litigations for months, as there is no agreement yet to review. The term sheet, a small on large picture items, has been agreed upon by power conferences, DI sports, and NCAA attorneys, but they still need to gather information and share it with member colleges and thousands of former and current DI athletes.
The details matter, also. Uncertainty and confusion have risen as to whether the new model had accidentally lead to new legal issues under Title IX, emigration, employment, and other laws involving paying college athletes. If NCAA regulations allowed for NIL, video game, and broadcast payment, schools might wonder how much money they would lose if profit was withheld to pay college sports for the income they may have made. There is also a similar case in Colorado, Fontenot v. NCAA, that is not (yet ) part of the settlement. Even if the settlement is approved, it wo n’t prevent athletes who are n’t in the class from filing their own antitrust lawsuits.
But when there is a final proposed agreement, perhaps by this fall or early 2025, Wilken will have the obligation under Federal Rule of Civil Procedure 23 ( e ) ( 2 ) to determine if the agreement is “fair, reasonable and adequate”.
For the attorneys involved, some of whom could make a fortune if the roughly$ 2.7 billion amount for retroactive compensation is approved and they are cut, meeting that broad standard wo n’t be a layup. Wilken may recognize some problems.
One of the concerns is whether the agreement had overradically rebuild school sports. As some courts have held, a settlement should n’t reshape an entire industry.
Simply ask Google.
In 2011, U. S. District ( now Second Circuit ) Judge Denny Chin, whose name might be familiar from Deflategate, rejected the” Google Book Settlement” on grounds it “would simply go too far”.
Google’s attorneys, authors, and producers negotiated what they believed to be a sensible solution to Google delivering and archiving thousands of books from libraries without the consent of trademark owners. Google was charged with breaking the Copyright Act, which grants artists the sole authority over how their books are reproduced and distributed. Google insisted its steps were protected by good use, which means illicit, but valid, copying of another’s copyrighted work. Google added that it had opened up new opportunities for trademark owners to increase their ability to sell books while expanding public exposure. According to the settlement, Google would pay for books it now scanned and for books it may scan, with author and publisher rights to decline.
Chin was troubled by this structure. He worried it had “give Google a major advantage over rivals” and “reward” Facebook” for engaging in general reproducing of copyrighted works without authority”. Although Chin acknowledged that” a universal digital library may gain many,” he found it difficult that Google was sued for allegedly scanning books and displaying snippets for online searches, despite the proposed settlement’s demand that Google continue to operate on a business model built on monitoring without authorization.
The judge also found it problematic that hundreds of critical comments about the agreement were made during a comment period that included hundreds of people who were mostly authors and writers. There were a lot of naysayers, and it appeared problematic for those who would be governed by a so-called resolution.
The Department of Justice also weighed in with an influential amicus brief for Chin’s consideration. The DOJ criticized what it called” an attempt to implement forward-looking business arrangements that go far beyond the court’s jurisdiction” in this litigation. The agreement, according to the group concerned that it would violate the” core principle” of the Copyright Act, which dictates how and where their works are used.
With the settlement rejected, the litigation resumed. It moved on to a trial and an appeal to the Second Circuit’s U.S. Court of Appeals. The case, which began in 2005, lasted more than a decade, with Google ultimately coming out on top.
David Drummond, the chief legal officer of Google/Alphabet from 2002 until his retirement in 2020, told Sportico there are analogous concerns with the NCAA antitrust settlement.
According to Drummond, Wilken might wonder whether a settlement should result in” such a significant restructuring of college sports.” Wilson will undoubtedly be aware of the settlement’s potential to reimagine college sports in a way that the NCAA and other institutions had long and vehemently opposed, including by allowing college sports to appear as minor league pro sports.
Additionally, according to Drummond, approval may be seen as violating fundamental antitrust and labor laws in ways that, as Chin is concerned about fundamental copyright law principles, will deter Wilken from saying yes.
The NCAA antitrust settlement is a work-in-progress and could change, but it does allow colleges to pay athletes up to a salary cap of about$ 21 million. That figure represents a 22 % share of the average power league college’s revenue, which is significantly lower than the pro leagues’, where athletes collectively bargain for about 50 % of the revenue. The settlement also calls for non- Power Five conferences, which were not named defendants for monetary damages, to nonetheless absorb a cost of about$ 990 million over a 10- year period.
Drummond, who received a full-ride football scholarship to Santa Clara University and later earned a Stanford Law School diploma, wonders how the settlement “is supposed to bind other Division I schools who are n’t even named in the complaint and who are essentially able to comply with antitrust law by negotiating with their players on their own”?
It’s a good bet Wilken will ask that question. From a labor law perspective, she might also be wondering if attorneys are having trouble bargaining what amounts to a CBA on behalf of college athletes. Since unions are the ones who negotiate CBAs, those athletes are currently unable to negotiate a CBA. Unions are composed of employees, and save for Dartmouth college men’s basketball players, college athletes have not (yet ) been recognized as employees. However, Wilken might have to wonder if a settlement that is expected to last ten years is too lengthy and comprehensive given the numerous legal efforts being made to recognize college athletes for their employment.
Wilken will be ready to inquire what happens after the 10-year settlement period is over. The NCAA may alter its rules to conform to the settlement, but once the settlement is no longer in effect, the NCAA may restore the old rules. Because it would lead to antitrust lawsuits, the NCAA probably would n’t do that. In a college sports environment where labor has been denied a voice as a collective, the possibility highlights the peculiarity of a settlement functioning as a labor agreement.
Wilken will also consider how many players choose to withdraw from the settlement. The more objections and opt-outs, as seen in the Google Book Settlement, will be perceived as insufficiently representing class members and achieving other legal objectives. She’ll likely also consider whether NCAA member schools disagree with the settlement or file legal action against the NCAA for alleged errors in how the settlement was approved and how it places unnecessarily burdened are financially.
The attorneys who are negotiating the settlement will make several points known in an effort to persuade Wilken to agree.
The NCAA will contend that all of its D1 members, including those outside the power conferences, have been subject to and benefited from the rules that the players have challenged, and that they are all held accountable. The NCAA will also stress that the settlement would help to lessen, if not end, the legal muddle brought on by ongoing and destabilizing antitrust litigation. In exchange for money, players would be able to release a large number of claims wherein they would agree to drop lawsuits and potential claims. The players could seek restitution from any of the schools if the NCAA decides to continue suing House, Carter, and Hubbard, which would potentially pit the schools against one another.
As for the players ‘ attorneys, they’ll contend the deal is a great one for college athletes. These athletes will earn money through NIL deals and receive compensation for the past and future earnings as well. The attorneys might also contend that the settlement would not foreclose a situation in which athletes are recognized as employees, unionized, and then bargain collectively with the NCAA, conferences, and academic institutions.
One thing is for certain: Wilken is uniquely situated to review the settlement. She is arguably the most knowledgeable judge in the world regarding NCAA antitrust issues. Wilken previously presided over Ed O’Bannon and Shawne Alston’s antitrust lawsuits. For the past ten and a half years, there have been NCAA antitrust cases on her case docket. As attorneys for NCAA, conference, and athletes who have testified before Wilken know well, they must bring their A games if they want their deal approved. ( This story has been updated in the headline. )