ncaa media exploitation of collegiate athletics

Running head: NCAA Media Exploitation of Collegiate Athletes 1

NCAA Media and Exploitation of Collegiate Athletes

David Walsh

High Point University

NCAA Media Exploitation of Collegiate Athletes 2

The National Collegiate Athletic Association (NCAA) has been around for 105 years,

and in their time they have managed to remain the governing body for over 1,200 institutions,

organizing athletic programs and helping over 45,000 student-athletes reach their goals. The

“non-profit” organization that brings you the College Football Bowl Series and March Madness

Basketball has really developed into a powerhouse. But at what point do you distinguish a

powerhouse organization from a monopoly? Often, organizations such as the NCAA use

unethical- and sometimes illegal actions to control their market. There is a side of the NCAA that

has gone virtually unnoticed, and there are several landmark cases and events that have changed

the NCAA’s image forever. The NCAA is a multibillion-dollar organization; it is worth noting

where the revenue is going, as well as where it should be going. It can be argued that the NCAA

is violating constitutional rights and ethical principles by using the name, image, and likeness

(NIL) of its athletes to gain profit without giving proper compensation from the organization and

its partners to the rightful recipients.

Student-athletes are the backbone of many major universities- public and private. They

help universities thrive in many ways: from marketing to bolstering school spirit. It is obvious

that without the effort from many student athletes, some schools would not be where they are

today. Look at Tulsa University; without the efforts of the student athletes in their athletic

programs, there is no way the school would have been as well known across the country as it is

today. There are undeniable connections between athletic success and school success, so why

should those students have to pay to come to a school where they are essentially pawns in

marketing efforts and catalysts in school spirit boosting? Of course, there is also the side of the

argument that student athletes should never be paid. The NCAA claims that "scholarship student-


athletes are not employees, they are students – exclusively – first, last and foremost” (NCAA,

n.d.). But without even mentioning the argument from the NCAA, there are other issues that go

along with paying collegiate athletes. If the NCAA were to pay student athletes, who would they

pay the most, the athletes who perform the best? Would athletes be paid on a contract, and what

if that player got injured? Would they only pay D1 programs? There are countless rules that

would change and challenges that would arise if the NCAA started paying its athletes. However,

the main question remains: should collegiate athletes be compensated for the use of their (NIL

based on laws belonging to the First Amendment? Based at the statutes involved as well as the

different cases and opinions, we can weigh the pros and cons.

If you are a collegiate athlete in a program governed under the NCAA, you are prohibited

from doing many things. The main point the NCAA drills into student-athletes is that they are

amateurs. This veil of “amateurism” prohibits student-athletes from “playing under contract,

accepting a salary, accepting prize money above necessary expenses, playing with professionals,

trying out, practicing, or competing for or with a professional team, accepting benefits from an

agent, agreeing to be represented by an agent, and delaying initial full-time collegiate enrollment

to participate in an organized sports competition” (NCAA, n.d.). The eligibility that students

must pass as amateurs ensures that they are “preserving an academic environment in which

acquiring a quality education is the first priority” (NCAA, n.d.). This is important, admittedly,

but the NCAA fails to recognize many factors that go into being a student-athlete. According to

the NCAA Sports Sponsorship and Participation Rates Report, “for the 2011-2012 academic

year, the average annual scholarship shortfall (out of pocket expenses) for each FBS ‘full’

scholarship athlete was $3,285” (Irick 2011). In the same report, it is recorded that “the typical


Division I college football player devotes 43.3 hours per week to his sport – 3.3 more hours than

the typical American work week” (Irick 2011). These numbers are astounding, and although they

only focus on the bigger-name programs, there are still fairness issues within all programs, big

and small.

There are certain statues that the NCAA has run into trouble with over the past decade.

Student-athletes have felt cheated for years in regards to the amount of money the NCAA is

making on the student-athletes’ NIL, and legal ethical concerns come into play as to where that

money should be going. The first statute the NCAA has been known to violate is the Sherman

Antitrust Law. The Sherman Antitrust Law was put into place in 1890, and was initially created

in order to combat monopolistic business practices and prohibit restriction of competition in the

marketplace. There have been several cases where the NCAA has been brought to court on the

bases of violation of the Sherman Antitrust Act. A 2009 case that paved the way for the future of

antitrust skepticism was O’Bannon v. NCAA. That year, Ed O’Bannon, a former UCLA

basketball player, filed an antitrust class action lawsuit against the NCAA. His case was filed

because he found that the NCAA were using the NIL of its collegiate athletes for commercial

purposes, therefore exploiting the players for financial gain and further publicity. While he was

at UCLA, O’Bannon felt that he couldn’t do anything about the NCAA using player NIL in their

EA Sports NCAA video games, but when they extended that reach beyond college, including

classic NCAA teams (such as the 1996 UCLA Bruins basketball team) as additions to their

game, O’Bannon felt that they were cheating the players of some compensation. In a text in the

Marshall Law Review, Welch (2011) states, “through its administration of Form 08-3a,

the NCAA has unconscionably and illegally obtained rights over former athletes' images for


eternity” (Welch 2011). In O’Bannon v. NCAA, text from the court decision states,

“O'Bannon and Newsome plead that Defendants violated Section 1 of the Sherman Act by

agreeing to fix prices and to engage in a group boycott, both of which constitute unreasonable

restraints of trade” (O’Bannon v. NCAA, 2009). The term “fix prices” is interesting because it

shows the clever angle O’Bannon used in the case to highlight the violation of the anti-trust act.

According to the lawsuit, the NCAA and the Collegiate Licensing Company (CLC) excluded

O’Bannon and his teammates from the collegiate licensing market when they forced them to sign

their contract for eligibility into the NCAA. Text in the O’Bannon case reads, “because the

NCAA has rights to images of him from his collegiate career, it, along with its co-conspirators,

fix the price for the use of his image at ‘zero’” (O’Bannon v. NCAA, 2009). O’Bannon is correct

in stating that the NCAA is excluding him from the market because it would be breaching the

NCAA’s contract to accept any money from other organization as compensation for the use of

his NIL, even though the NCAA has fixed the compensation price of its student-athletes at $0. In

Section 2 of the Sherman Anti-Trust Act (1890), it is stated that, “Every person who shall

monopolize, or attempt to monopolize, or combine or conspire with any other person or persons,

to monopolize any part of the trade or commerce among the several States, or with foreign

nations, shall be deemed guilty of a felony” (Sherman Anti-Trust Act, 1890). For example, since

the NCAA went into an agreement with EA Sports, they gain revenue from video game sales.

However, if a competitor of EA Sports (hypothetically, Nike’s College All-Stars Challenge video

game) decided to offer O’Bannon compensation for using his NIL in their video game, he would

be prohibited from accepting it due to NCAA rules. What Ed O’Bannon brought to light with his

case is the illegal stronghold the NCAA has on its student-athletes as well as the market.


There are more cases that demonstrate the power of the NCAA. In 2004, the Metropolitan

Intercollegiate Basketball Association (MIBA), the organization behind the National Invitational

Tournament, filed an anti-trust lawsuit claiming that the NCAA had monopolized the market.

The NIT was started in 1938, before the NCAA tournament, and was once the leading

tournament for college basketball. As the years went on and the NCAA grew larger and more

powerful, the NIT became a secondary option. The lawsuit in 2004 was filed as a result of a rule

that the NCAA created that prohibited the teams that made the NCAA tournament from

attending the NIT. This essentially made the best teams unavailable for the NIT and ruined its

chances of ever hosting the best teams in the future. There is a set of rules put into place by the

NCAA for its postseason, and one of them is the “End of Playing Season” rule. It is stated in

MIBA v. NCAA, “NCAA argues that the End of Playing Season Rule protects the welfare of

student athletes because it prevents coaches from forcing their teams to play and practice all year

long” (MIBA v. NCAA, 2004). This is a feeble attempt by the NCAA to justify keeping student-

athletes from competing in a different tournament other than its own, a league that has the

potential of compensating its student-athletes for the revenue they bring. The case resulted in a

denial of summary judgment for the NCAA, and promptly caused the NCAA to make moves.

Less than a year later, The New York Times published the news; “The N.C.A.A. settled an

antitrust suit yesterday by buying the preseason and postseason National Invitation tournaments

for $56.5 million” (Litsky, 2005). The motion of buying out the NIT to take them off of the map

was not an out-of-character move by the NCAA; in 1982, they bought out the Association for

Intercollegiate Athletics for Women (AIAW) by usurping large collegiate groups that had

previously supported the AIAW. In the text AIAW History (1970-1982), written by Leotus


Morrison, she states “after much discussion the board of the AIAW decided to disband rather

than see women in athletics split and we negotiated with the NCAA to secure leadership

opportunities in the NCAA for women. It was a difficult decision because we had representation

from three different collegiate groups and we were leaving two of those groups which had been

an important part of AIAW” (Morrison, n.d.). A question that some may ask when one thinks of

the NCAA as a whole is, “what makes it different from the NFL, NBA, and other professional

sports organizations? Why don’t those organizations get slapped with an anti-trust lawsuit as

well?” In the past, nearly every professional sports organization has had an anti-trust lawsuit

brought up on them, but they are almost always exempt. An example of exemption from these

laws can be seen in American Needle Inc. v. NFL. The exemption from the anti-trust law was

under the grounds that each NFL team was its own business that is free to create their own

revenue, therefore the NFL could not be monopolizing the market or violating any anti-trust act.

In the case of American Needle Inc. v. NFL, it is stated, “the league’s teams were best described

as a single source of economic power when promoting through the licensing of intellectual

property, meaning that there was no basis for a claim under section one of the Sherman Act”

(American Needle Inc. v. NFL). This reason for exemption does not work for the NCAA,

however, because the NCAA regulates over 1,200 institutions while simultaneously stripping

student-athletes of their right to profit from their NIL, something no professional organization

does. Now that the NCAA has acquired, merged with, or eliminated all of its competition, their

only threat has been in the form of lawsuits. The kind of power demonstrated by the NCAA in

acquisitions alone is a direct example of its efforts to monopolize the market and eliminate

competition, actions that are prohibited by anti-trust acts.


Another statute the NCAA does not allow its student-athletes the liberty to is the right of

publicity. The right of publicity is directly related to the argument that student-athletes should be

compensated for the use of their NIL. However, the right of publicity is a less straightforward

statute compared to the Sherman Anti-Trust Act. This statute is only recognized in about half of

the states in the United States, and it interpreted differently by each state. According to the Legal

Information Institute at Cornell University, the right of publicity can be defined as a statute that

“prevents the unauthorized commercial use of an individual's name, likeness, or other

recognizable aspects of one's persona. It gives an individual the exclusive right to license the use

of their identity for commercial promotion” (Cornell University, n.d.). In previous cases, the

right of publicity has come into play with cases that almost mirror O’Bannon v. NCAA. In Keller

v. NCAA, Sam Keller, a former Nebraska and Arizona State quarterback, sued the NCAA and

EA Sports for violation of his right of publicity after the use of his NIL in an EA Sports video

game. Similar to O’Bannon, Keller v. NCAA is a case where the plaintiff asserts, “there is

misconduct by NCAA and CLC, related to NCAA's amateurism rules. Plaintiff maintains

that NCAA's approval of EA's games violates NCAA's ‘duty to NCAA athletes to honor its own

rules prohibiting the use of student likenesses.’ He cites NCAA Bylaw 12.5, which prohibits the

commercial licensing of the ‘name, picture or likeness’ of athletes at NCAA-member

institutions. Plaintiff asserts that CLC must honor NCAA's prohibitions on the use of student

likenesses” (Keller v. NCAA, 2010). The lawsuit filed cites both California and Indiana right of

publicity statutes, covering both the locations of the NCAA (Indiana) and EA Sports (California).

Basically, Keller is arguing that his right of publicity was taken from him and used freely by the

NCAA. In the California statute, it reads, “Any person who knowingly uses the (NIL) … without


the person’s prior consent shall be liable for all damages … and any profits of the unauthorized

use are attributable to the injured party” (CAL. CIV CODE § 3344). The hypocritical use of its

student-athletes NIL is made to seem unintentional by the NCAA, but in the interests of revenue,

the actions aren’t out-of-character.

What is the solution to the exploitation of student-athletes? What kind of conclusion will

retain the competitiveness and entertainment value in the NCAA while giving the student-

athletes what they deserve? Broadcasting revenue is at an all-time high, according to an NCAA

press release, “The NCAA today announced a new 14-year television, Internet and wireless

rights agreement with CBS Sports and Turner Broadcasting System Inc., to present the Division I

Men’s Basketball Championship beginning in 2011 through 2024 for more than $10.8 billion”

(NCAA, 2010). Ratings are at an all-time high as well. In a recent article from Forbes, Tom Van

Riper (2014) states, “The title game between Louisville and Michigan drew 23.4 million viewers,

trailing only the Alabama-Notre Dame BCS Championship football game (26.4 million) and the

NFL (multiple games) for sports television supremacy last year” (Van Riper, 2014). But with the

growth of the NCAA over the years, there have been bumps in the road. Both the O’Bannon and

Keller case have been recently settled in favor of the plaintiffs, which is an important step toward

changing the direction the NCAA in terms of using players NIL in video games and other media.

O’Bannon was extremely successful, where in 2014 he was able to settle a ruling, this ruling

“prevented the NCAA from enforcing any rules or bylaws that would prohibit its member

schools and conferences from offering their FBS football or Division I basketball recruits a

limited share of the revenues generated from the use of their names, images, and likenesses in

addition to a full grant-in-aid” (Berkowitz, 2014). Judge Wilken’s ruling stated, “the NCAA will


be able to cap the amount of new compensation that Football Bowl Subdivision and Division I

men's basketball players can receive while they are in school, but that cap will not be allowed to

be an amount that is less than the athletes' cost of attending school” (O’Bannon v. NCAA, 2009).

This took ruling took some financial pressure off of student-athletes who had previously been

struggling with the annual scholarship shortfall mentioned before, but does not necessarily

justify the amount of money the “non-profit” NCAA is still making off of NIL of its student-

athletes. An example of a first-hand account of this scholarship shortfall can be seen in 2013. In

that year’s NCAA Tournament, there was a famous quote by UConn basketball standout Shabazz

Napier; he complained, “there are nights that I got to bed starving.” This example highlights

another huge reason so many talented collegiate athletes opt out of finishing their college

education to make the jump to professional sports. Why struggle with finances as a student-

athlete when you can make big bucks playing the sport you are good at? This idea that so many

student-athletes share goes against that one seemingly paramount policy the NCAA preaches,

education before athletics.

In the wake of the O’Bannon ruling, the NCAA made more moves. First, they

discontinued the NCAA EA Sports video games, which was a necessary step in the halting of

exploitation of student-athletes’ NILs. Secondly, they settled on the other case involving the

unfair use of NIL, Keller v. NCAA. The case that was scheduled to go to trial in March 2015 and

both decisions were cleared in an NCAA press release, “The NCAA today agreed to settle claims

against the Association over college-themed basketball and football video games produced by

Electronic Arts. The agreement will end the Keller litigation … the settlement will award $20

million to certain Division I men’s basketball and Division I Bowl Subdivision football student-


athletes who attended certain institutions during the years the games were sold” (NCAA, 2014).

Again, this is another big step toward delivering proper compensation to the rightful recipients,

the student-athletes.

Bottom line, in the world of collegiate sports, the NCAA rains king. There are staggering

statistics that show that the NCAA is a cash cow and that the revenue they bring in annually is

the same if not greater than some professional sports organizations. In a 2013 interview with

ESPN’s Mark Schlabach, NCAA president Mark Emmert had an interesting answer to a specific

question. Schlabach asked him, “Why doesn’t college sport’s governing body sponsor an

Ultimate Frisbee Tournament?” Emmert responded, “The NCAA didn't have a ‘tsunami of cash’

at its disposal” (ESPN, 2013). According to Kantar Media (2014), the NCAA March Madness

Tournament alone, “generated $1.15 billion in ad revenue in 2013” (Kantar Media, 2014). That

number is expected to increase greatly over the next decade. Not only is it unethical for the

NCAA, a multi-billon dollar “non-profit” organization, to not compensate its student-athletes for

their NIL, it is unlawful as well.


References

American Needle, Inc. v. National Football League, et al., 130 S. Ct. 2201, 176 L. Ed. 2d 947 (2010).

Irick, E. (2011). NCAA Sports Sponsorship and Participation Rates Report 1981-1982 – 2010-2011.

The Value of College Sports. (n.d.). Retrieved from http://www.ncaa.org/student-athletes/value-college-sports

Summary of NCAA Regulations. (2012, January 1). Retrieved from http://fs.ncaa.org/Docs/AMA/compliance_forms/DI/DI Summary of NCAA Regulations

O'Bannon v. Nat'l Collegiate Athletic Ass'n, No. 09-3329 (N.D. Cal. July 21, 2009).

Sherman Anti-Trust Act of 1890, §§ 1-7, 15 U.S.C. (1890).

Right of Publicity, CAL. CIV CODE § 3344, (n.d.).

Metro. Intercollegiate Basketball Ass'n v. NCAA, 337 F. Supp. 2d 563, (S.D.N.Y., 2004).

Litsky, F. (2005, August 18). N.C.A.A. Buys N.I.T. for $56.5 Million. Retrieved from http://www.nytimes.com/2005/08/18/sports/ncaabasketball/18nit.html

Morrison, Leotus. “AIAW History (1970-1982).” 1-3, Lee Morrison Papers, Special Collections, Carrier Library, James Madison University, Harrisonburg, Virginia.

Right of Publicity, an overview. (n.d.). Retrieved from https://www.law.cornell.edu/wex/publicity

Keller v. Elec. Arts, Inc., et al., 2010 U.S. (N.D. Cal., 2010).

Solomon, J. (2014, August 8). Retrieved from http://www.cbssports.com/collegefootball/writer/jon-solomon/24653743/obannon-judge-rules-ncaa-violates-antitrust-law

Schlabach, M. (2013, July 12). NCAA: Where Does the Money Go? Retrieved from http://espn.go.com/college-sports/story/_/id/6756472/following-ncaa-money

Van Riper, T. (2014, March 20). March Madness Ratings And Revenue Keep Reaching New Heights. Retrieved from http://www.forbes.com/sites/tomvanriper/2014/03/20/march-madness-ratings-and-revenue-keep-reaching-new-heights/


References (cont.)

Welch, B. (2011). UNCONSCIONABLE AMATEURISM: HOW THE NCAA VIOLATES ANTITRUST BY FORCING ATHLETES TO SIGN AWAY THEIR IMAGE RIGHTS. John Marshall Law Review.

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