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Homework answers / question archive / In Alston v
In Alston v. NCAA, District Court Judge Claudia Wilken ruled that the NCAA could no longer cap the amount of educational benefits a school can reward an athlete: “Restricting non-cash education-related benefits and academic awards that can be provided on top of a grant-in-aid has not been proven to be necessary to preserving consumer demand for Division I basketball and FBS football as a product distinct from professional sports. Allowing each conference and its member schools to provide additional education-related benefits without NCAA caps and prohibitions, as well as academic awards, will help ameliorate their anticompetitive effects and may provide some of the compensation student-athletes would have received absent Defendants’ agreement to restrain trade” (104.10–104.19). Under the ruling, schools — if allowed by their conferences — could give athletes anything furthering their education (computers, science instruments and more). However, the decision underscored a desire to have a clear distinction between college and professional sports. In order for Alston to win this case, they had to show that the NCAA (1) had a contract or conspiracy; (2) that this agreement unreasonably restrained trade under either a per se rule of illegality or a rule of reason analysis; and (3) that the restraint affected interstate commerce. District Court decided to apply the rule of reason analysis because NCAA’s structure necessitated a “certain degree of cooperation”. We will break into groups to discuss and answer the questions below: 1. Economic theory says monopsony market restrictions are anti-competitive (lead to inefficiencies). However, the NCAA (attorney Waxman) argues that monopsony restrictions on compensating college athletes is pro-competitive and therefore does not violate antitrust laws. Explain this reasoning in the context of antitrust law. 2. According to the case (and related to question #1) what is distinction between college and professional sports and why is it important? 3. Justice Alito says student-athletes are paid in room and board, tuition, special admissions. The distinction is not if they are paid but the form they are paid and how much. Does this distinction matter with respect to the Supreme Court’s decision? 4. How (or why) might the rule of reason apply in this case? That is, why aren’t the NCAA schools’ agreement (cooperation, joint venture) to limit compensation a clear violation of the Sherman Act (and therefore a per se rule applies)? 5. Justice Robertson says it is troublesome that schools pay $50,000 for insurance to protect athletes for future earnings (amount is not limited), which seems like pay-for-play in that it is to entice players to play in college. Is this pay for play? What is the NCAA response? 6. Justice Alito states that court briefs for respondents paint stark picture of powerhouse programs exploit students, money funds enormous salaries for coaches and other parties while athletes spend hours training, pressure to study, low graduation rates, drop hard majors and classes, and a small percentage make money in pros and without even a college degree. Does the evidence (from class) support or refute this view? 7. Justice Barrett asks whether allowing education-related benefits would impact on Title IX and women’s sports? Waxman replies that evidence shows that schools would likely find the money from reducing non-revenue sports thus lowering benefits of those other sports. Do you think any potential impacts on Title IX relevant in the Court’s decision? 8. The justices mention consumer demand survey – why is it relevant to the case?
