June 27 (Bloomberg) -- Lawyers for the National Collegiate Athletic Association and current and former athletes faced questions from a federal judge about rights to millions of dollars a year in broadcast revenue.
At the conclusion of a three-week trial in Oakland, California, U.S. District Judge Claudia Wilken today asked about different proposals under which, if she finds a violation of antitrust law, athletes might share in the revenue.
One option Wilkin, who will decide the case without a jury, said she would consider for compensating athletes for the use of their names, images and likenesses, or NILs, is allowing the schools and NCAA to keep money generated by current athletes. She said the NCAA might be barred from selling rights to continued use of NILs after students graduate, unless it first negotiates with athletes for those rights. She inquired whether possible remedies might cause new antitrust violations.
“Could we keep competitive balance and have revenue sharing by giving to poorer schools, like the pros reward teams that lose?” she asked. “Or would that be an antitrust violation?”
Glen Pomerantz, an NCAA lawyer, argued all the options generated new problems. William Isaacson, attorney for the athletes, encouraged the judge to adopt any of them.
The trial will determine whether the NCAA, which treats student-athletes as amateurs, has engaged in an antitrust cartel and must allow players to negotiate payment for their appearance in broadcast games. The athletes are seeking control over their names, images and likenesses and compensation for their use.
Under NCAA regulations athletes can be stripped of their scholarships and barred from playing if they accept payment.
The NCAA had $912 million in revenue last year, including $838 million from television, championships and marketing-rights fees, according to its financial statement.
The plaintiffs, led by former University of California at Los Angeles basketball player Ed O’Bannon, must prove the NCAA conspired to restrain the student players’ market for the use of their names, images and likenesses in violation of antitrust law.
Even if O’Bannon’s lawyers succeed in proving such restraint occurred, the NCAA might still prevail if it can show its policies denying student-athletes royalties encourage competition, Isaacson has said.
O’Bannon said during trial testimony that he doesn’t believe he and current NCAA student-athletes were or are amateur players. He said the UCLA games he played were televised locally, regionally and nationally, and that playing basketball was his priority -- not academics.
O’Bannon said he first realized his image was being used in video games in 2008. While he received no compensation, he said he’d be willing to sell his image for video games.
NCAA President Mark Emmert testified that paying student athletes would betray the organization’s core value of amateurism and damage the popular appeal of college sports.
The case is In Re NCAA Student-Athlete Name and Likeness Licensing Litigation, 09-01967, U.S. District Court, Northern District of California (Oakland).
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