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O'Bannon v. NCAA

United States District Court for the Northern District of California

August 8, 2014, Decided; August 8, 2014, Filed

No. C 09-3329 CW

Opinion

 [*962]  FINDINGS OF FACT AND CONCLUSIONS OF LAW

INTRODUCTION

Competition takes many forms. Although this case raises questions about athletic competition on the football field and the basketball court, it is principally about the rules governing competition in a different arena -- namely, the marketplace.

Plaintiffs are a group of current and former college student-athletes. They brought this antitrust class action against the National Collegiate Athletic Association (NCAA) in 2009 to challenge the association's rules restricting compensation for  [*963]  elite men's football and basketball players. In particular, Plaintiffs seek to challenge the set of rules that bar student-athletes from receiving a share of the revenue that the NCAA and its member schools earn from the sale of licenses to use the student-athletes' names,  [**11] images, and likenesses in videogames, live game telecasts, and other footage. Plaintiffs contend that these rules violate the Sherman Antitrust Act. The NCAA denies this charge and asserts that its restrictions on student-athlete compensation are necessary to uphold its educational mission and to protect the popularity of collegiate sports.

A non-jury trial on Plaintiffs' claims was held between June 9, 2014 and June 27, 2014. After considering all of the testimony, documentary evidence, and arguments of counsel presented during and after trial, the Court finds that the challenged NCAA rules unreasonably restrain trade in the market for certain educational and athletic opportunities offered by NCAA Division I schools. The procompetitive justifications that the NCAA offers do not justify this restraint and could be achieved through less restrictive means. The Court makes the following findings of fact and conclusions of law, and will enter as a remedy a permanent injunction prohibiting certain overly restrictive restraints.

FINDINGS OF FACT

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7 F. Supp. 3d 955 *; 2014 U.S. Dist. LEXIS 110036 **; 2014-2 Trade Cas. (CCH) P78,865; 2014 WL 3899815

EDWARD O'BANNON, et al., Plaintiffs, v. NATIONAL COLLEGIATE ATHLETIC ASSOCIATION; ELECTRONIC ARTS INC.; and COLLEGIATE LICENSING COMPANY, Defendants.

Subsequent History: Affirmed in part and reversed in part by O'Bannon v. NCAA, 802 F.3d 1049, 2015 U.S. App. LEXIS 17193 (9th Cir. Cal., 2015)

Prior History: O'Bannon v. NCAA, 2009 U.S. Dist. LEXIS 122205 (N.D. Cal., Dec. 11, 2009)

CORE TERMS

student-athletes, football, licenses, basketball, athletic, teams, sports, consumer, videogames, amateurism, attendance, telecasts, networks, leagues, submarket, procompetitive, players, television, buyers, footage, grant-in-aid, restrain, sellers, antitrust, bundles, output, intercollegiate, bylaws, anticompetitive, archival

Antitrust & Trade Law, Monopolies & Monopolization, Conspiracy to Monopolize, Sherman Act, Price Fixing & Restraints of Trade, Per Se Rule & Rule of Reason, Market Definition, Relevant Market, Product Market Definition, Regulated Industries, Higher Education & Professional Associations, Colleges & Universities, Sports, General Overview, Regulated Practices, Cartels & Horizontal Restraints, Relevant Market, Sherman Act, Remedies, Injunctions