2021 was a transformative year on many fronts, including in sports law. There were several legal controversies in sports that have shaken the industry.
It became clear when the U.S. Supreme Court held the oral argument for NCAA v. Alston in March: The NCAA was in trouble. The justices peppered the NCAA’s attorney, Seth Waxman, with hostile questions about a system of rules that prevent college athletes from earning compensation. On a court with both conservative and liberal justices, they seemed to agree on at least one thing: The NCAA’s system of amateurism was deeply problematic.
Still, the justices voting 9-0 against the NCAA surprised many. Few expected a shutout.
The Court held that the NCAA and its member schools violate antitrust law when they conspire to limit how much each can compensate athletes for academic-related costs. In a blistering concurrence, Justice Brett Kavanaugh described the NCAA as a cartel that “would be flatly illegal in almost any other industry in America.”
The ruling was both transformational and incremental.
The NCAA has long viewed itself as deserving of preferential treatment under antitrust law. That era is over. Ongoing antitrust litigations against the NCAA have already relied on the Alston ruling, which has since been cited in other types of antitrust litigation, including one involving McDonald’s hiring practices.
Meanwhile, schools have begun to capitalize on the Court’s ruling, which now allows them to give cash awards equal to the NCAA limit on athletic cash awards (currently, $5,980). Ole Miss and Texas are set to provide those awards. Other schools will follow.
Yet college sports are not much different in this post-Alston world. Crucially, the ruling does not invalidate NCAA rules on the more central feature of college sports: limits on compensation for athletic-related costs. When the Alston litigation began in 2013, it was much more disruptive. It proposed a new world where colleges could pay recruits their market value. Over the years, the case shrunk into one that only challenged academic-related costs. Also, while Justice Kavanaugh’s concurring opinion is often quoted, it’s not the law. The far more restrained majority opinion by Justice Neil Gorsuch is what governs.
Despite losing Alston, the NCAA and its system of amateurism remain alive—though not as solidly as before and vulnerable to further attack.
- College Athletes Can Sign Name, Image and Likeness Deals
A controversial idea when Ed O’Bannon took the NCAA to court in 2009, NIL had achieved wide support—even from the NCAA—by the start of 2021. Yet the NCAA was unable to adopt NIL without unwanted intervention by states and a failed effort by Congress to pass a federal NIL statute.
NIL empowers college athletes to hire agents and negotiate the use of their names, images and likenesses with video game companies, apparel companies, trading card shows, athletic camps and other industries.
Although often described as a new right, NIL allows college athletes to enjoy their right of publicity—a right they already have as Americans. NIL merely restrains the NCAA and schools from punishing college athletes for using that right.
In January, the NCAA indefinitely punted on an NIL vote. It did so after receiving a worrisome letter from the Justice Department about how NIL restrictions could spark antitrust scrutiny. Whether the letter, authored by a Justice Department official who was set to leave office when Joe Biden became president, warranted such a reaction invited skepticism.
The NCAA then pleaded with Congress to pass a federal NIL law before such statutes in a group of states would go into effect on July 1. NCAA president Mark Emmert made his last pitch to the U.S. Senate on June 9. It came up short.
When July 1 arrived, the NCAA adopted an interim NIL policy that essentially tells schools to follow state NIL law or, if no such law exists, adopt reasonable NIL restrictions. The NCAA stresses that colleges can’t pay college athletes, who under NCAA rules can’t be paid by anyone for their labor.
Some confusion has already arisen. Last week, Sportico revealed that the NCAA is probing Miami and BYU to determine if NIL deals for football players are, in reality, pay-for-play inducements to enroll, and remain, at those schools. Expect to see other investigations over payments that are nominally for NIL but might have ulterior motives. Whether the NCAA will be able to accurately assess the true intentions of NIL deals is a separate question.
Like the Alston ruling, NIL hasn’t radically altered college sports. With several celebrated exceptions, NIL deals have generally been modest. Opendorse recently calculated that the median monthly NIL earnings for all Division I college athletes, including the many who have not signed deals, is $6 a month. Among those D-I athletes who have landed deals, they’re pocketing about $250 a month..
Of course, for many college students, a monthly infusion of $250 is nothing to sneeze at. And, as O’Bannon himself stressed, the purpose of NIL was never to make college athletes rich. It was to ensure they’re treated like other college students and Americans.
- U.S. Women’s Soccer Team Appeals Pay Case, While Olivia Moultrie Gets to Play
Over the summer, members of the U.S. Women’s National Soccer Team appealed their defeat in a long-running pay discrimination case. The players insist that U.S. Soccer pays them a lower rate of pay than USMNT players and that the lower rate reflects sex discrimination. Though USWNT “only” netted a bronze medal at the Tokyo Summer Olympics, it has consistently outperformed the USMNT over the years and, USWNT maintains, has not been paid accordingly. Several prominent politicians, most notably President Biden and Sen. Elizabeth Warren, have advocated on behalf of the women’s position.
U.S. Soccer flatly disputes the players’ pay calculations. It also contends the USWNT’s union was offered, but rejected, the USMNT’s pay structure, which eschews guarantees for bonuses. As U.S. Soccer tells it, the USWNT players pursued a structure focused on guaranteed pay. U.S. Soccer also emphasizes that the women’s union negotiated and accepted the structure that the players now claim is illegal.
A yet-to-be-named panel of three judges on the U.S. Court of Appeals for the Ninth Circuit will review the arguments in 2022 and issue a ruling that could eventually land at the U.S. Supreme Court.
As they battle in court, the women’s team players and U.S. Soccer could see their collective bargaining agreement expire. The CBA was set to run out on Dec. 31, 2021 but has been extended for an additional three months. U.S. Soccer would like to negotiate identical CBAs with the USWNT and USMNT, which have played with an expired CBA since 2018.
Meanwhile, the women’s soccer world also saw a young player take on the establishment in 2021 and, effectively, win.
Olivia Moultrie, 15, sued the National Women’s Soccer League over its 18-year-old age eligibility requirement. U.S. District Court Judge Karin Immergut issued an injunction in May that permitted Moultrie to sign with the NWSL’s Portland Thorns. Moultrie, who as a 13-year-old signed a nine-year endorsement deal with Nike, then reached a settlement with NWSL that reaffirmed her right to play. Moultrie played in nine matches for the Thorns.
- Kyrie Irving, Aaron Rodgers Vaccine Holdout Part of Political Debate
While 97% of NBA players are vaccinated against COVID-19, Brooklyn Nets star Kyrie Irving reportedly is not. Unfortunately for Irving, he plays in New York City, where Mayor Bill de Blasio issued an executive order barring unvaccinated people from entering the city’s sports arenas. Irving thus can’t enter the Barclays Center, where his Nets play home games, or Madison Square Garden, where the Knicks play. Oddly, if Irving still played for the Boston Celtics, he’d be able to play in the Big Apple. NYC’s executive order only applies to players on the Nets and Knicks, not visiting teams.
Irving stepped away from the Nets before the season per mutual agreement with team management. While he was still being paid for games in which he was eligible to play, he projected to forfeit about $16 million of his $33 million salary for games in NYC. In December, however, Irving and the Nets agreed that he would return. But he hasn’t played since he reportedly tested positive for COVID-19.
Irving will remain unavailable for home games and games at MSG, unless he gets vaccinated or NYC law changes.
It’s possible that NYC Mayor-elect Eric Adams, who will take office on Jan. 1, could rescind the executive order or amend it in a way that permits Irving to play. But with infection rates climbing and with uncertainty over the Omicron variant, Irving shouldn’t expect that. In fact, NYC recently expanded the vaccine mandate to include all private sector employees, beginning on Dec. 27.
Meanwhile, Green Bay Packers quarterback Aaron Rodgers took heat in November after he tested positive for COVID-19. Rodgers had previously said he was “immunized” in response to a journalist’s question about whether he had been vaccinated. “Immunized” could mean natural immunity that comes after an infection, in addition to immunity derived from a vaccine. Regardless, Rodgers acknowledged on an appearance on the Pat McAfee Show that he “misled” people, though he also complained he was “in the crosshairs of the woke mob.” Rodgers’ sponsors had varying reactions to the brouhaha.
The vaccination statuses of Irving and Rodgers have been raised in political debate over vaccine mandates in the workplace and in schools. With the pandemic showing no signs of ending, expect that debate to continue.
- NFL Pays St. Louis in Relocation Case but Not Oakland
Faced with the unappealing prospect of seeing commissioner Roger Goodell and team owners testify before a St. Louis jury in January, the NFL cut its losses in November, reaching a settlement with the city and county governments and the public entity that owns the Dome at America’s Center. The league will reportedly pay $790 million to resolve contractual claims that centered on whether the NFL had unlawfully applied its own relocation policy in the Rams’ move to Los Angeles.
The four-year litigation undermined the league’s presentation as a united front. As leaked to the media, Rams owner Stan Kroenke suggested he might reach a settlement with St. Louis on his own, thus leaving the league and other owners to fend off the city’s lawsuit. Kroenke and the league also wrangled over whether he should pay the legal fees and related costs. For a league that argued it was a “single entity” to the U.S. Supreme Court, it seemed anything but during the Rams litigation.
The NFL fared much better in resolving litigation brought by Oakland over the Raiders’ relocation to Las Vegas. In December, the Ninth Circuit ruled in favor of the NFL, which had been portrayed as a cartel by Oakland attorneys. While St. Louis’ contract-based lawsuit advanced, Oakland’s antitrust-based lawsuit fumbled. That is a lesson worth remembering for cities that may lose teams in the future.