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Supreme Court says NCAA can't limit some benefits to student athletes

In a unanimous decision, the justices said a lower court's injunction is consistent with established antitrust principles.
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WASHINGTON — The Supreme Court ruled unanimously Monday that the National Collegiate Athletic Association went too far in blocking some education-related aid for student athletes, a decision that comes as college athletics struggles with the issue of how to preserve its amateur status.

The court said the NCAA violated antitrust laws when it limited the amount students could receive for musical instruments, scientific equipment, postgraduate scholarships, tutoring, academic awards and paid internships.

Writing for the court, Justice Neil Gorsuch said U.S. District Judge Claudia Wilken was correct in dismissing the organization's argument that antitrust law doesn't apply to the case. Her decision, he said, was based on "an exhaustive factual record, a thoughtful legal analysis consistent with established antitrust principles, and a healthy dose of judicial humility."

In a concurring opinion, Justice Brett Kavanaugh said the “NCAA and its member colleges are suppressing the pay of student athletes who collectively generate billions of dollars in revenues for colleges every year. Those enormous sums of money flow to seemingly everyone except for student athletes.”

He was especially critical of the NCAA’s justification for its rules, namely that the popularity of college athletics depends on fans knowing that the athletes aren’t paid.

“The NCAA’s business model would be flatly illegal in almost any other industry in America," Kavanaugh wrote. "All of the restaurants in a region cannot come together to cut cooks’ wages on the theory that ‘customers prefer’ to eat food from low-paid cooks.”

The Supreme Court's ruling did not, however, address the contentious issue of whether student athletes can be paid salaries or get other forms of compensation. The NCAA said it would consider this month whether student athletes can be compensated for the use of their names and images, which could allow them to benefit from endorsements and social media marketing.

"While today’s decision preserves the lower court ruling, it also reaffirms the NCAA’s authority to adopt reasonable rules and repeatedly notes that the NCAA remains free to articulate what are and are not truly educational benefits, consistent with the NCAA’s mission to support student-athletes," the organization said in a statement.

NCAA President Mark Emmert said the group "remains committed" to supporting name, image and likeness benefits for student athletes, and "to working with Congress to chart a path forward."

Monday's decision was a victory for current and former athletes in Division I basketball and the Football Bowl Subdivision, led by former West Virginia University running back Shawne Alston and former University of California center Justine Hartman. They filed a lawsuit over the NCAA's limits on education-related benefits.

Antitrust law is involved because the schools compete aggressively for the best players and coaches. The courts have said that even though the NCAA's limits on student benefits restrain some of that competition, the rules help preserve amateur status.

The NCAA had urged the court to rule in its favor.

"For more than a hundred years, the distinct character of college sports has been that it's played by students who are amateurs, which is to say that they are not paid for their play," the organization's lawyer, Seth Waxman of Washington, told the justices when the case was argued in March.

But the sports governing body faces growing pressure from state legislatures. More than a dozen have already passed laws allowing college athletes to be paid for the use of their names and images, and seven of those laws take effect in July.

The state provisions do not change the NCAA's ban on compensation from the athlete's school, but they would allow payments from other sources. Students who accept money for the use of their likenesses could risk losing their eligibility to play in sanctioned sports unless the NCAA changes its rules.

Congress is considering a bill that would provide a nationwide standard, but no action is imminent.