Saturday, August 9, 2014

How the NCAA Won a Lawsuit That It Lost

Yesterdays ruling in the Ed O'Bannon case sent ripples throughout college athletics. Some people went as far as proclaiming it the death of college athletics. When the early news broke of the ruling against the NCAA, I was skeptical and rightfully so. The NCAA almost always loses lawsuits brought against them. I repeat, the NCAA almost always loses lawsuits brought against them. The real jewel in any litigation against the NCAA has NOT been the short verdict but the extensive judge rulings. That is where the real-world ramifications of lawsuits against the NCAA is found. The O'Bannon case isn't any different and its 99-page judge ruling was a substantial win for the NCAA.

To understand the ruling, I need to quickly address the basics of the case. O'Bannon and other plaintiffs were challenging the NCAA restraints on athletics-based compensation, the cap on total financial aid, and the prohibition on compensation from outside sources (such as endorsement deals or autograph signings). The O'Bannon trial wasn't really about pay for play or athletes being paid salaries, instead it was more about increasing the value of scholarships (which are estimated as high as several thousand dollars short each year) and giving the athletes an ability to capitalize on their own image and likeness. Think of it in terms of a drama major being on scholarship, and still being able to receive compensation for commercial or movie appearances (completely legal by the way).

The proposed solutions of the O'Bannon trial were to raise the limit on grant-in-aid funded by licensing revenue (not federal dollars), create a trust fund where schools could deposit a share of licensing revenue to be paid to student athletes after they graduate or leave school, and allow student athletes to be compensated for third-party endorsements. The judge ruled in favor of the first two propositions, but rejected the last one as a means of protecting student-athletes from "commercial exploitation" (very ironic statement). The third and final proposition is probably the most important one, in regards to money and power. It was the key proposition in deciding the true fate of the case. If athletes were given complete control, it probably would have ended college athletics; if athletes and the universities were both able to profit off of likeness, it would have been a real win for the athletes. Not being able to receive compensation for third-party endorsements clearly made the trial a win for the NCAA and member institutions.

I'm of the opinion that institutions should be able to profit off of a "student-athletes" likeness as sort of a compromise in return for a scholarship and the various perks that come with it, but they shouldn't hold complete control over an athlete's likeness. Take Johnny Manziel, who was probably the most famous teenager in America two years ago. How much could he have made off his likeness from corporations looking for a young spokesman for a product? I don't even know how to quantify the amount. Now he's a professional athlete and well-paid, but what if his career fizzles, what if he was at his peak brand value as a collegiate athlete? Is it fair to punish, or in this case make a player wait, to capitalize on their own brand despite knowing how fleeting brand value can be? I believe that limiting an athlete's ability to capitalize off of his own name and image is un-American, but apparently that is the new norm nowadays. Now I know some believe that since previous generations athletes weren't able to profit off of their image, that it is fine now too, but in past generations athletes weren't apart of a billion dollar industry run by Corporate America. If anyone is to "blame" here it is the universities that sold out on integrity to be pawns of Corporate America for the all-mighty dollar.

So what exactly does the O'Bannon decision mean for the future of college athletics, specifically football and basketball? In the short term, nothing really, although some could argue that it is the "first cut" to the current model of college athletics since schools have now been put on notice that licensing dollars aren't completely their own. I don't think it is a coincidence that this decision was reached after the Power-5 Conferences (ACC,SEC,PAC-12,Big-10,Big-12) were granted autonomy over their own legislation the day before. The Power-5 conferences had previously already agreed to many of the concessions of this lawsuit, but were outvoted by the smaller conferences that didn't have the funds to increase their financial aid packages and feared being unable to recruit quality athletes because of it. Basically, all the changes the lawsuit brought about were inevitable, to make it even better for the NCAA the judge ruled that they could also cap those increases as well. The major powers (Texas, Ohio State, Florida, etc) can easily afford the new requirements with little consequence and still retain absolute power over the athletes.

Until The NCAA allows the players to actually profit off of their own likeness from third-parties, the players will still be nothing more than chess pieces, and will continue to be maneuvered as such. It also will continue to penalize athletes from poor backgrounds (the ones who would benefit the most from being able to make some cash off of their likeness), and did nothing to lessen the environment for scandal and improper benefits that still exist. My hope is that this is a step in the right direction, and the Power-5 Conferences will use their new autonomy to really address some of the fundamental issues of college athletics, not just monetary but academic as well. I'm very aware that college athletics and the NCAA aren't all bad (I'm a proud beneficiary of the system), so I hope positive changes continue so that the model will still exist in some form. I think it is safe to say that the college athletics Doomsday meter has been reset back a couple of years.