NCAA Judge Says Athlete-Pay Rules Takes Effect Next Year

A federal judge clarified when the National Collegiate Athletic Association must scrap rules barring student athletes from seeking a share of its $800 million in annual broadcast revenue.

U.S. District Judge Claudia Wilken in Oakland, California, said her injunction overturning the rules will take effect next year on Aug. 1. Until then, the NCAA, which has vowed to appeal the decision, can continue applying the rule, which is designed to prevent student athletes from being paid like professionals.

Wilken ruled this month that the NCAA can’t prohibit students from getting paid for licensing their names and likenesses up to the full cost of attending school. She also said the NCAA can’t bar schools from offering to put a share of licensing revenue aside for players, to be paid after they leave school. The NCAA can cap the payments, but they can’t be less than $5,000 for every year of play, she said.

The Indianapolis-based association, the governing body for most U.S. college sports, said in a statement on its website yesterday that it will fight the judge’s order in a higher court because “we do not believe the NCAA has violated any antitrust laws.”

Damage Appeal

The NCAA and broadcasters said paying players could lead to athletes with agents, fewer teams and waning fan interest. Compensating players would damage the popular appeal of college sports and prompt schools to quit Division I competition because big-money schools would have the funds to attract the best athletes, NCAA President Mark Emmert testified in June.

In a lawsuit filed in 2009, ex-college basketball player Ed O’Bannon challenged the demand by the NCAA that colleges treat students as amateurs. The plaintiffs said college basketball and football have evolved into multibillion-dollar businesses, with money flowing to the NCAA, broadcasters, member schools and coaches -- everyone but the players.

The case is O’Bannon v. National Collegiate Athletic Association, 09-cv-03329, U.S. District Court, Northern District of California (Oakland).

To contact the reporter on this story: Steven Church in Wilmington, Delaware at schurch3@bloomberg.net

To contact the editors responsible for this story: Andrew Dunn at adunn8@bloomberg.net Charles Carter

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