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Supreme Court Appears Poised to Break Up NCAA’s Monopoly Power Over College Athletes in Landmark Antitrust Case


The Supreme Court of the United States heard oral arguments on Wednesday in a case that will determine whether or not college athletes can be adequately paid for their labor.

The National Collegiate Athletics Association (NCAA), along with a smaller college athletics association and a handful of states, says that students should be subject to the organization’s rules and cannot be endorsed by outside third parties because that would render college athletes into something more than amateurs. The students, along with dozens of law professors, economists, historians, former NCAA officials and the U.S. government, believe the NCAA is engaged in classic antitrust behavior and using their arguments about amateurism to shield their actions from scrutiny.

The NCAA argues that they are not a for-profit enterprise and that their basic goal is “to maintain intercollegiate athletics as an integral part of the educational program.” One of the ways the group does this, their argument goes, is by retaining “a clear line of demarcation between intercollegiate athletics and professional sports.”

On the students side, the argument goes that things have changed since the NCAA was established in 1905 — and they have changed substantially. The organization is a multi-billion dollar entity; many high-profile coaches are paid seven figure salaries; and many college athletes are often worked nearly as hard as members of the NBA and NFL.

The law at issue is the Sherman Antitrust Act of 1890.

In relevant part, the Sherman Act says that “[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.”

The NCAA is admittedly restraining the ability of college athletes to enter into economic agreements of their own. The group says they are entitled to an antitrust exemption because their commitment to preserving amateurism is “part of serving a societally important non-commercial objective: higher education.”

The students say the modern world demands a modern way of looking at the NCAA — or, rather, simply applying existing antitrust law to the group’s “monopolistic practices” because of the way college sports have changed in the past 115 years. In other words, they want courts to be able to evaluate the NCAA’s admitted restraints on trade using “a fact- and market-based analysis.”

A California federal district court and the U.S. Court of Appeals for the Ninth Circuit have already ruled in the students’ favor. The NCAA appealed and was granted certiorari in order to press its case before the Supreme Court.

You might call it the full court press.

Set against the backdrop of the Final Four, the case stylized as NCAA v. Alston could become a landmark ruling when it is eventually decided. It has the potential to remake the landscape of college sports — or the high court’s ruling could keep things more or less the same.

But judging by the tenor and the content of questions from the nine justices during oral argument on Wednesday, the nation’s high court looks poised to rule in the students’ favor — and maybe even farther.

Attorney Seth Waxman said the proposed compensation agreements would be “akin to professional salaries” and cited “the unique history” at play between the 115-year-old NCAA and the national college sports market. Most of the justices were dismissive of the NCAA’s appeals to history — and some were explicitly antagonistic.

“You can only rely on the history here for so long,” centrist Justice Elena Kagan said at one point. “These are competitors all getting together with total market power to fix prices.”

“They use that power to fix athletic salaries at extremely low levels — far lower than the market would set,” she added.

Chief Justice John Roberts noted that the NCAA pays for students’ insurance and said it sounded like a version of “pay-to-play” that the NCAA uses to discourage students from going professional.

“Doesn’t that undermine the amateur status theory that you have?” he asked.

Justice Clarence Thomas was the first to bring up the hot-button issue of coach pay and asked what impact those salaries have on the amateurism analysis.

“Coaches are not student athletes,” Waxman said in response. “They are professionals.”

“It strikes me as odd that the coaches’ salaries have ballooned and they’re in the amateur ranks,” Thomas replied.

Justice Samuel Alito posed a particularly harsh interrogation:

The briefs that are submitted in support of the [students] paint a pretty stark picture and they argue that colleges with powerhouse football and basketball programs are really exploiting the students that they recruit. They have programs that bring in billions of dollars as Justice Thomas mentioned. This money funds enormous salaries for coaches and others in huge athletic departments, but the athletes themselves have a pretty hard life. They face training requirements that leave little time or energy for study, constant pressure to put sports above study, pressure to drop out of hard majors and hard classes, really shockingly [low] graduation rates. Only a tiny percentage ever go on to make any money in professional sports. So, the argument is they are recruited, they’re used up and then they’re cast aside, without even a college degree, so they say, “How can this be defended in the name of amateurism?”

Waxman attempted an answer about graduation rates being high for most NCAA athletes but was cut off by the conservative justice who dismissed those numbers as being relegated to the ranks of students on rowing and fencing teams.

Liberal Justice Stephen Breyer came the closest to defending the NCAA — frequently expressing concerns about the terms of the lower court’s order and railing against judicial management of economic activity. Some of those concerns were later echoed, in lesser form, by Justice Sonia Sotomayor, who said she was worried about the destruction of “the game.”

But while each of the two most left-leaning members of the court posed some of the toughest questions to Jeffrey Kessler, the students’ attorney, neither justice appeared to be particularly convinced by the NCAA’s arguments on the actual legal merits.

Kessler, for his part, was repeatedly tossed softballs by most of the court — including arch-textualist Justice Neil Gorsuch and Samuel Alito — who both essentially teed up opportunities for the students to point out the NCAA’s monopsony power over student athletes.

“The center of the case is an agreement among competitors to fix prices in the labor market,” Gorsuch noted in his earlier comments to Waxman in his typically matter-of-fact manner. “Here, the NCAA has monopsony control over labor price. There isn’t another league.”

Justice Brett Kavanaugh premised his comments and questions with an “overarching concern” that “antitrust laws should not be a cover for exploiting student athletes” and added that he believed “schools are conspiring with competitors to pay no salaries to workers,” leaving little room for doubt on his position here either — though he later tempered his stance by expressing concern for floodgates of litigation that might ensue with a favorable result for the students.

Justice Amy Coney Barrett may have been the most averse to the NCAA overall. In her questioning of Kessler, she dismissed the allegedly revered nature of the NCAA’s place in history (and consumers’ esteem) and hinted that the organization’s entire business model might be more broadly anti-competitive than even the students were arguing.

“The idea is to allow the market to decide,” the students’ attorney noted at one point — stressing the limited nature of the lower court’s ruling. “This injunction doesn’t require one school to pay anything.”

If left to Barrett and some of the more conservative justices alone, the market might best be left to decide heavily against the NCAA as presently constituted, it seemed.

“Put yourself in position to be in position,” college basketball coach Bobby Knight often told his players. On Wednesday, the student athletes looked to be in such a spot.

[Image via Joe Robbins/Getty Images]

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