Student athletes playing under NCAA auspices today filed an antitrust
class-action lawsuit against the NCAA and the NCAA's most powerful
members including the Pac-12, Big Ten, Big-12 as well as the SEC and
ACC, claiming these entities have agreed in violation of national
antitrust laws to cap the value of athletic scholarships despite the
fact that the NCAA's valuation of athletic scholarships is far below the
actual cost of attending school, and far below what the free market
The class-action case seeks to represent former NCAA Division I Football
Bowl Subdivision (FBS) scholarship players who have played from February
2010 to the present within those conferences.
"Members of FBS teams have generated significant annual revenue for NCAA
members and their business partners in a highly commercialized and
professionalized entertainment industry," said Steve Berman, managing
partner of Hagens Berman Sobol Shapiro LLC and lead attorney on the
case. "Not a single dollar of that revenue would exist if it were not
for the efforts of the Football Bowl Subdivision football players
The new suit filed in U.S. District Court in San Francisco alleges that
the NCAA and these five Power Conferences have systematically colluded
to disrupt the free market and deprive FBS football players of the full
economic benefits of their labor. According to the complaint, NCAA rules
artificially depress the value of athletic scholarships - known as
Grants-in-Aid or GIAs - to typically several thousand dollars less per
year, per player, than the actual cost to attend an NCAA school.
The suit's plaintiff - former West Virginia University football star
Shawne Alston - received a grant-in-aid scholarship from WVU that was
intended to cover all tuition and registration fees, required
course-related fees, room, meals and required textbooks, but was
significantly lower than the roughly $40,000 annual cost of attendance.
In 2012, Alston had to take out a $5,500 loan to cover the difference
between his GIA and the actual costs of attendance. During the 2011-2012
academic years, Alston led the WVU Mountaineers in number of touchdowns,
securing major victories. In his senior year, Alston led the team to its
being ranked eighth in the nation. Still, during his time at WVU, Alston
was unable to work, given rigorous academic and athletic obligations,
and took out loans to cover costs that were not covered in the college's
The complaint alleges that in a market unrestricted by NCAA and member
restrictions on GIAs, schools would compete for star athletes like
Alston and pay at least the full cost of attendance. The lawsuit seeks
an injunction to prohibit any agreement on capping GIA's below the cost
of attendance and past damages for players who had to pay the difference
between their scholarship and the cost of attendance as a result of the
"The NCAA and its members should stand for fairness and equal
opportunities to share in economic success. I hope that this litigation
can be part of making that a reality," Alston said. "I'm extremely
humbled by the opportunity to step forward on behalf of my football
teammates, opponents and all other FBS football players."
The complaint alleges that each of the five Power Conference Defendants
has stated that they would implement an increasein GIAs, and that every
FBS player would likely receive additional compensation above the cost
of attendance, if they were not bound by collusive agreements with other
Division I schools. Additionally, the complaint alleges that the
defendants, "repeatedly claim powerlessness, year after year, to change
their lucrative status quo, because smaller NCAA members won't agree to
the change. Were the Defendant Conferences to act unilaterally, each
would raise the GIA cap above the current levels."
The suit was filed on behalf of FBS football players by lead attorneys
Steve Berman and Bruce Simon. Berman is the managing partner of Hagens
Berman and the lead attorney in related cases Owens v. NCAA in which
football players are challenging the NCAA's neglects to protect
student-athletes from concussions, and Keller v. NCAA, in which
student-athletes are challenging the NCAA's ability to sell their
likeness to video-game publishers.
Simon is a lead partner at Pearson Simon, and one of the plaintiffs'
attorneys in O'Bannon v. NCAA, where student-athletes are challenging
the NCAA's restraints on players sharing in the licensing of their
images in products such as live broadcasts.
According to Berman, the new case differs in certain respects from the
ongoing cases about image rights.
"This new case gets at a fundamental issue having nothing to do with
image rights, but everything to do with basic economic rights. FBS
football players should no longer be treated as second class citizens,"
Berman said. "They generate massive amounts of money for the schools and
the NCAA, and these players should not have to struggle to make ends
meet while they are surrounded by multi-millionaire coaches."
"Our case contains a proposal that is designed to provide economic
fairness," Berman said. "Numerous reasonable, less restrictive
alternatives are available to Defendants' current anti-competitive
practices, including allowing incremental competition between Power
Conference Defendants and against their co-conspirator conferences
within FBS as to the financial aid terms that conference members will
make available to college football players."
"We expect the NCAA to defend this case with their standard playbook,
based on their version of 'amateurism' which is the same defense the
NCAA has deployed in most cases of this type," said lead attorney on the
case, Bruce Simon. "In this new case, we look forward to continuing to
demonstrate that the NCAA's defense does not apply. FBS football cannot
continue to thrive without the dedication of the student athletes, but
the NCAA and Power Conferences should abide by the antitrust laws that
all other businesses must follow."
The complaint requests past damages to compensate class members for the
difference between the value of scholarships and the actual cost of
attending school, and also requests an injunction to enjoin defendants
from continuing to enforce their anticompetitive rules. Additionally,
the complaint requests the appointment of an External Antitrust
Compliance Monitor to ensure that defendants conduct themselves in
compliance with the antitrust law, and to provide a mechanism for future
judicial oversight of defendants' operations, as was recently approved
in the antitrust litigation captioned United States v. Apple, Inc., case
number 1:12-CV-2826, filed in U.S. District Court in the Southern
District of New York.
Current or former NCAA athletes seeking more information about the case
can contact Hagens Berman at 206-623-7292 or Pearson Simon at
415-433-9000. They can also email NCAAscholarships@hbsslaw.com.
More information about these issues is available at http://www.hbsslaw.com/cases-and-investigations/cases/NCAA-Scholarships
About Hagens Berman
Hagens Berman Sobol Shapiro LLP (HBSS) represents consumers,
whistleblowers, investors, workers and others in complex and
class-action litigation. The firm is currently involved in a number of
cases representing NCAA and NFL athletes on image/likeness issues, as
well leading a class-action case against the NCAA regarding concussions,
and also representing former NFL players in regards to concussions. The
firm has offices in nine cities and has been named to the National Law
Journal's Plaintiffs' Hot List six times. Founded in 1993, HBSS
continues to successfully fight for plaintiffs' rights in large, complex
litigation against large corporations, recovering numerous
multimillion-dollar awards. More about the law firm and its successes
can be found at www.hbsslaw.com.
Visit the firm's class-action law blog at www.classactionlawtoday.com.
About Pearson Simon
Pearson, Simon & Warshaw, LLP (PSW) has emerged as a nationally
recognized force in class action lawsuits and complex litigation, with
offices in Los Angeles and San Francisco. PSW's attorneys' skill and
experience have enabled clients to press for justice against major
companies. The firm's veteran trial lawyers have obtained more than $1
billion in settlements and verdicts on behalf of plaintiffs in a wide
range of cases. More about the law firm can be found at www.pswlaw.com.
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