College Football Bowl Game System Raises Antitrust Concerns, Varney Says

College football’s Bowl Championship Series raises anticompetitive concerns because it lacks a playoff system, said Christine Varney, who heads the U.S. Justice Department’s antitrust division.

In a May 3 letter, Varney asked National Collegiate Athletic Association President Mark Emmert if he attempted to establish playoffs before the championship game, as is the case in other sports.

“Serious questions continue to arise suggesting that the current Bowl Championship Series system may not be conducted consistent with the competition principles expressed in the federal antitrust laws,” Varney wrote.

The Justice Department has been urged by 21 professors and “other prominent individuals” to take antitrust action against the NCAA, she said. Playoff PAC, a political action committee that wants the sport to adopt playoffs and scrap its system of using polls and computer rankings, filed a complaint in September with the Internal Revenue Service.

The group said the Fiesta, Orange and Sugar Bowls are violating their tax-exempt status by providing excessive compensation to executives, spending undisclosed amounts on lobbying and intervening in political campaigns. The group also said that bowls provided substantial private benefits to organizational insiders.

Operating as Charities

The Fiesta, Orange and Sugar Bowls represent three of the five bowls that make up the BCS. The others are the Rose Bowl and the BCS championship game. The bowls operate as tax-exempt 501(c)3 charities, and contributions to the organizations are tax deductible.

Fiesta Bowl President and Chief Executive Officer John Junker was fired in March following an independent investigation into campaign contributions and executive compensation.

Emmert has said “the NCAA is willing to help create a playoff format for Football Bowl Subdivision football” as long as members of the group agree. Schools in the FBS, formerly known as Division 1-A, have the most competitive football programs.

Bob Williams, an NCAA spokesman, declined to comment on Varney’s letter until the organization receives it.

To contact the reporter on this story: Jeff Bliss in New York at jbliss@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.