May 28, 2024
The NCAA has suffered many losses in federal court over the past few years with several stemming from the Supreme Court’s decision in NCAA v. Alston. There, the Supreme Court deemed it an antitrust violation for the NCAA to impose any restrictions on a student-athlete’s ability to receive education-related stipends beyond their cost of attendance including, but not limited to, funding to be a research assistant or a paid internship at their university.[1] This decision itself did not grant student-athletes the opportunity to be compensated for their name, image and likeness (collectively “NIL”) nor did it grant them the opportunity to be paid for playing their sport.
The Alston decision’s impact was felt even more heavily in the concurring opinion of Justice Kavanaugh where he shredded the NCAA’s business model.[2] He wrote that the NCAA’s current practice is “price-fixing labor”[3] and at his bluntest, stated that, “The NCAA’s business model would be flatly illegal in almost any other industry in America.”[4] Just nine days after the Alston decision was published, the NCAA adopted a uniform policy suspending any restrictions on a student athlete’s opportunity to be compensated for their NIL across all sports.[5]
The NCAA since has lost numerous times in federal court on antitrust grounds — notably in Ohio v. NCAA where the Court ruled it was an antitrust violation for the NCAA to bar a player from participating in their sport for a year if they transferred.[6] Today, the NCAA allows student-athletes who have transferred to be immediately eligible to play, no matter how many times they have switched schools.
What distinguishes Johnson v. NCAA from the NCAA’s most recent bouts in federal court is that this case is not being argued on antitrust grounds, but on strictly labor law grounds under the Fair Labor Standards Act.[7] The plaintiffs of this case are led by a former Villanova football player, and they are seeking minimum wage compensation for the time they spend in practice and competition.[8] The plaintiffs note that they already sign time cards tracking how much time they spend practicing given that the NCAA has imposed a 20-hour per week practice rule.[9] On interlocutory appeal, the 3rd Circuit is addressing directly whether it is plausible that college athletes could be deemed employees.[10] NCAA student-athletes have advocated for this classification at the Circuit level in the past, but they lost at both the 7th and 9th Circuit Courts.[11]
The tone of the oral arguments at the 3rd Circuit has given some confidence though that this panel of judges may rule differently than those in the past.[12] Judge Restrepo referred to Division 1 athletic departments as “regimes,” and Judge Porter acknowledged limitations in the 7th Circuit decision particularly as it relates to Division 1 athletes competing in revenue-generating sports.[13]
The 7th Circuit decision was joined by Judge Hamilton, but he wrote a concurring opinion where he acknowledged their reasoning could be limited in the context of revenue-generating Division 1 sports.[14] He wrote that, “in those sports, economic reality and the tradition of amateurism may not point in the same direction,” and with a developed factual record, there should be room for further debate to address employment status.[15] Judge Porter specifically addressed this language during the 3rd Circuit oral arguments, and the entire panel brought questions forward regarding athletes in revenue-generating sports.[16]
In a February 5, 2024 decision, the National Labor Relations Board ruled that Dartmouth men’s basketball players were employees under the National Labor Relations Act.[17] It is not hard to imagine that the 3rd Circuit would find it plausible that a student-athlete could be considered an employee particularly in the same context of revenue-generating Division 1 sports. Given the billions of dollars in television and streaming revenue the NCAA continues to earn through these sports, coupled with the large compensation paid to college coaches, arguments about the fiscal inability to pay any student-athletes at all are largely mute.
Should the NCAA lose here, the District Court will have to consider the amateur vs. employee question with the 3rd Circuit’s further guidance. The NCAA could appeal the case to the Supreme Court, but they may be hesitant to do so given the tone of the decision rendered in Alston regarding the NCAA’s notion of amateurism. A split between the 3rd Circuit and the 7th and 9th Circuits though would give the Supreme Court even more reason to grant certiorari to this case.
Victor Ficarra is Class of 2024 graduate of the Temple University Beasley School of Law.
[1] See NCAA v. Alston, 141 S. Ct. 2141, 2165 (2021).
[2] Id at 2166.
[3] Id at 2167.
[4] Id.
[5] Laura C. Murray, The New Frontier of NIL Legislation, 60 Hous. L. Rev. 757, 766 (2023).
[6] See Ohio v. NCAA, 2023 U.S. Dist. LEXIS 22953, (2023).
[7] Richard Johnson, Explaining Johnson v. NCAA and What’s At Stake in Wednesday’s Court Hearing, Sports Illustrated (Feb. 15, 2023), https://www.si.com/college/2023/02/15/johnson-v-ncaa-court-hearing-employment-status.
[8] Id.
[9] Id.
[10] Amanda Christovich, Federal Judges Blast NCAA’s Amateurism Model, Front Office Sports (Feb. 16, 2023, 9:38 AM), https://frontofficesports.com/federal-judges-blast-ncaas-amateurism-model/.
[11] Id.
[12] Id.
[13] Id; Ralph Johnson, et al v. The National Collegiate Athletic Association, et al, Docket No. 22-01223 (3d Cir. Feb 8, 2022).
[14] See Berger v. NCAA, 843 F.3d 285, 294 (2016).
[15] Id.
[16] Ralph Johnson, et al v. The National Collegiate Athletic Association, et al, Docket No. 22-01223 (3d Cir. Feb 8, 2022).
[17] Christopher R. Deubert, Considering The Implications of the NLRB Regional Office’s Dartmouth Decision, Sports Business Journal, (April 1, 2024), https://www.sportsbusinessjournal.com/Articles/2024/04/01/oped-01-deubert.