NCAA Athletes Seek Class Status for Lost NIL Pay in Lawsuit

Michael McCann
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The case poised to follow Ed O’Bannon’s and Shawne Alston’s lawsuits in rocking NCAA restraints on athlete compensation escalated on Friday.

Attorneys for Arizona State swimmer Grant House, Oregon basketball player Sedona Prince and former Illinois football player Tymir Oliver petitioned for class certification. They aim to represent many thousands of current and former college athletes who have been denied—unlawfully, their attorneys charge—NIL revenue, with NIL construed broadly to include billions of dollars in broadcast revenue paid to colleges and conferences as well as lost opportunities to appear in college video games that were never made.

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House v. NCAA (also called In Re College Athlete NIL Litigation) is before Judge Claudia Wilken, the same trial judge who presided over O’Bannon and Alston. Like those two cases, House is an antitrust lawsuit that charges the NCAA and its member schools, as well as Power Five conferences, illegally conspire through amateurism rules to deny players economic opportunities.

This time around the argument centers on NIL opportunities players could have had prior to the NCAA’s permitting NIL on July 1, 2021, and on the continued denial of other pay opportunities for college players. The players are represented by teams of attorneys from Winston & Strawn (led by Jeffrey Kessler) and Hagens Berman (led by Steve Berman).

Friday’s 51-page brief proposes four classes. The first is an injunctive relief class that would consist of all DI athletes who competed or will compete from June 15, 2020 (when the complaint was filed), to the date of judgment in the case, which is currently scheduled for trial on Sept. 16, 2024, and could face additional years of appeals. The purpose of this class is to obtain a court order that would compel the NCAA to change rules. The attorneys contend the NCAA’s interim NIL policy doesn’t go far enough in ensuring athletes have a right to monetize their NIL.

“The interim NIL rules,” the brief says, “do not permit direct NIL payments to athletes from the NCAA, conferences, or schools. In essence, after arguing for years that NIL compensation would be the death knell of college sports, Defendants have now embraced NIL compensation, but only insofar as it is paid for by third parties and not out of their own pocketbooks.” These third-party deals, the brief asserts, “do not come close to restoring to college athletes the full value of their NILs.”

The briefs blast schools for not sharing the TV money generated through the marketable identities of college athletes appearing in games. “It’s not as though Defendants do not have the means to share with athletes the billions of dollars in broadcast revenues that their NILs help to generate for Defendants,” the brief maintains. The brief adds that college players “play in stadiums and arenas that are filled with logos—endorsements of companies that compensate their colleges—and they compete on national television in uniforms and shoes licensed by their schools.”

The other three classes are damages classes, meaning monetary compensation is sought on their behalf. A “football and men’s basketball class” would consist of DI football and men’s basketball players who have played since June 15, 2016, to the date Judge Wilken would certify the class (likely not until next year). According to the brief, this class projects to have at least 6,280 members. These players, the brief charges, have been deprived of NIL opportunities, including sharing in multibillion dollar TV contracts.

Players also lost money when video game publishers tried to include them in games but were denied. NCAA Football 2014 and NCAA Basketball 10 were the last college sports games published by EA. The brief notes that EA sports executives testified in O’Bannon and made subsequent comments indicating they “wanted to license the NILs of college athletes for its college sports video games and tried for years to convince the NCAA to allow it to happen … but NCAA rules prevented [EA] from doing so.” In other words, but for NCAA rules, thousands of college players could have been in games, and been paid for the use of their likenesses.

The other two damages classes are a women’s basketball class, which also traces back to 2016 and projects to have at least 856 members, and an “additional sports class,” which would essentially include all other non-basketball and non-football DI players who were, or have been, denied their full NIL and which projects to have at least 7,384 members.

A petition for class certification is hardly automatic. The NCAA will counter the players’ arguments. Judge Wilken will demand the proposed classes comply with Rule 23 of the Federal Rules of Civil Procedure, which insists that a class meet a bevy of requirements, including that the claims of House, Prince and Oliver are typical of the classes they purport to represent. She could certify, modify or reject the groups proposed by the players.

Still, if Judge Wilken certifies classes that are in the ballpark of those proposed by the players, the ramifications would prove enormous. It would mean the NCAA and its member schools face a lawsuit that could conceivably claw back billions of dollars and redistribute that money to current and former athletes.

House is occurring in a transformative era for college sports and the law. Last year, in Alston v. NCAA, the U.S. Supreme Court held the NCAA is subject to ordinary antitrust scrutiny. Although Alston concerned only education-related costs, more important, the case confirmed that NCAA restrictions on athletes’ economic opportunities are not beneficiaries of preferable treatment under antitrust law. Meanwhile, the NCAA has lobbied for a federal NIL bill that would contain an antitrust exemption that repels lawsuits such as House. But the NCAA hasn’t enjoyed traction, with Democratic and Republican members skeptical of an exemption. The NCAA also faces Johnson v. NCAA, which is before the Third Circuit and demands college athletes be paid at least as well as work study classmates who are paid to work at games, and assorted memos and petitions before the National Labor Relations Board that call for recognition of college athletes as employees who can also unionize.

With House seeking billions of dollars already paid—and at least in theory, already spent—to the NCAA and member schools and conferences, it’s unclear how schools, many of which say they are financially strapped and stress there are restrictions on endowments, would foot the bill.

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