O’Bannon Trial Decision Changes Everything But Preserves The Status Quo

Apr 6, 2014; Arlington, TX, USA; NCAA president Mark Emmert speaks at a press conference before the national championship game between the Kentucky Wildcats and the Connecticut Huskies at AT&T Stadium. Mandatory Credit: Kevin Jairaj-USA TODAY Sports

After 5 years in torturous discovery and litigation, Ed O’Bannon’s landmark case against the NCAA reached its conclusion and US Federal District Judge Claudia Wilken delivered the much-anticipated bench verdict: despite finding the NCAA’s model of amateurism to be in outright violation of antitrust laws, Judge Wilken issued such a limited injunction against the NCAA that practically very little has now changed for either the NCAA or student-athletes.

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Sports Illustrated’s legal expert Michael McCann, who has been an avid follower and chronicler of the NCAA’s recent legal issues, wrote a fantastic article breaking down Judge Wilken’s decision into small, digestible pieces. The crux of the decision is as follows: Judge Wilken wrote 99 pages of rhetoric that lambasted the NCAA and led readers to believe that she was about to implode the NCAA and everything for which it stands.

In contrast though, the actual injunction, which is the legally enforceable aspect of the decision and the part that requires specific action to be performed, was incredibly narrow and meek relative to the grandiose rhetoric that preceded it. In the end, Judge Wilken conclusively determined that the NCAA and its member schools were in direct violation of antitrust law through its concepts of amateurism and the manner in which they colluded anti-competitively to prohibit student-athletes from being compensated for their name, image, and likeness (NIL) rights.

However, her injunction allowed the NCAA to continue to prohibit student-athletes from endorsing products and capped potential NIL earnings from media revenue at $5,000 annually per football or men’s basketball student-athlete, starting with the 2016 recruiting class. The NIL payments would be held in trust and not paid until the student-athletes either graduated or exhausted eligibility. She also allowed NCAA member schools to cap direct compensation to student-athletes at the cost of attendance for each school.

McCann also broke down the next steps for each side. The NCAA will likely appeal Judge Wilken’s decision to the U.S. Court of Appeals for the 9th Circuit, which hears appeals for cases brought in the U.S. District Court of Northern California, and attempt to have the appeals court overturn the District Court decision. Despite being only narrow losers in the O’Bannon trial, the NCAA’s concept of amateurism was essentially laughed at and torn apart by Judge Wilken’s decision, making it near-impossible for the NCAA to argue in future trials that student-athletes shouldn’t be monetarily compensated above the value of an athletic scholarship based on amateurism rules and ideals.

The interesting twist could come in O’Bannon also appealing the decision despite being the nominal winner of the case. Attorney Jeremy Jarrett breaks down the winners and losers of the trial a bit more in depth on The Sports Esquires blog and raises some interesting points that O’Bannon would want to bring up in an appeal. Despite Judge Wilken strongly arguing in favor of O’Bannon that the NCAA’s member schools colluded to nullify the monetary value of student-athletes’ NIL rights, she then somewhat bizarrely concluded that a $5,000 cap on yearly trust payments to players for NIL rights was acceptable. O’Bannon could very convincingly argue that such a cap is just another, just slightly less abhorrent, form of price-fixing that restrains student-athletes from attaining market value for their NIL rights.

Furthermore, O’Bannon could argue that not allowing student-athletes to be compensated for endorsements is another form of restraint on student-athletes attaining market value for their NIL rights.

It will be fascinating to see this case and the respective strategies of both legal teams unfold going forward. At the very least, it seems fair to say that, right now, “amateurism” as a concept seems to be dead, but the NCAA itself hasn’t quite been sunk just yet.