Before there were the White or O’Bannon or Alston or House athlete antitrust cases, Rick Giles, the founder of the College Basketball Invitational (CBI), tried to sue the NCAA for price-fixing.
A former college football player at Princeton who spent eight years working at IMG, Giles founded a sports marketing company, the Gazelle Group, in 1994, which went about organizing in-season college sports competitions.
Two years later, the NCAA began its formal process of certifying exempt tournaments—which offered schools the chance to play more games than their maximum of 28—and thus embarking on what the association is known to do well: create rules.
One of those provisions required exempt-tournament organizers to defray many of the expenses incurred by the participating teams, including reimbursing 50% of travel costs, providing free lodging and dispersing $30 per diems for each member of the traveling parties. Then, the NCAA adopted the so-called “two-in-four” rule, where Division I members were allowed to participate in a maximum of two certified events over a span of four years.
In 2000, Giles’ company and three other promoters sued the NCAA for violating the Sherman Antitrust Act, arguing that the association’s rules were illegally stifling free-market competition. By then, the NCAA had decided to do away with the forced reimbursement requirements, after having received threatening letters from the promoters’ lawyers. In 2003, a federal judge overseeing the case issued a permanent injunction against the NCAA, preventing it from enforcing the two-in-four rule, while still acknowledging the governing body was “not subject to traditional antitrust limitations.”
The injunction was soon overturned on appeal and the case was dismissed, thus relegated to a small footnote in the annals of college sports legal history.
“If we were to present that case today, we would probably win in a landslide,” Giles said in a recent interview, noting the Supreme Court’s 9-0 ruling against the NCAA in the Alston case and Justice Brett Kavanaugh’s blistering concurring opinion that called out the other compensation policies of college sports’ governing body.
Giles said that while his Ohio-based attorneys were at the time spoiling for a much bigger antitrust war with the NCAA, the litigation had dragged on for so long that he and his co-plaintiffs were ready to call it a day.
The promoters struck a settlement with the NCAA, which Giles said included a “little bit of money,” and the two-in-four rule went by the wayside in 2006.
Following the lawsuit, Giles said he tasked a couple of his interns with a project to conceptualize a “much more streamlined college sports governing body,” one with far fewer rules that allowed for players to be compensated based on their market value.
Whether it has to do with college athletes or tournaments, Giles is unapologetically in favor of pay-for-play—a position he says he has held since his academic days.
“It is only a matter of time before we take the next steps, whether (players) are treated as employees or they are contracted,” Giles said. “The fact is they should be getting paid directly by schools. This NIL situation is way better than what it was, but it is not what it should be.”
After establishing several early-season tournaments, including the Atlantic City Shootout (now Empire Classic) and Legends Classic, Giles launched the CBI as his first postseason foray in 2008. It sought to capitalize on an opening created that year by the National Invitation Tournament’s reconsolidation to a 32-team field (after experimenting for a few years with 40) and adoption of automatic qualifiers. One of the CBI’s distinguishing and controversial features is that it charged schools to participate; initially the price was $50,000, which was slashed to $27,500 in recent years.
Days before the CBI was set to finalize its first 16-team field, Giles received a cease-and-desist letter from the NIT, which had been purchased by the NCAA in 2005 as part of a separate antitrust settlement. Ignoring its rival’s threat, Giles’ tournament took place, ultimately crowning Tulsa as its inaugural champion.
“It was a great tournament for us, obviously, because we won it,” said Bubba Cunningham, then Tulsa’s athletic director and now the AD at North Carolina. “And, to Rick’s credit, it has lasted 15 years.”
That the CBI has endured for a decade-and-a-half is, indeed, something to behold, given not only its treacherous start and subjection to endless ridicule—in 2017, the Chicago Tribune listed it among “50 of the dumbest things in sports”—but how the industry’s recent upheaval has undone far more ingrained features in the college sports fabric.
“We have beaten the odds,” Giles said.
That’s not to say the CBI had it all figured out from the start; it has more survived than thrived over its tenure. The tournament’s original business proposition was centered on what it saw as the overlooked postseason value of college basketball’s home-court advantage. The NCAA tournament plays all games at neutral sites, while the NIT hosts its early rounds on the home courts of its higher seeds. The NIT semifinal and championship contests were historically played at Madison Square Garden in New York until this year, when they move to Las Vegas.
Until the pandemic, the CBI hailed itself as the only postseason college basketball tournament that had a championship series (best-of-three) and could theoretically celebrate its champion on its own home floor. The now-defunct CollegeInsider.com Tournament (CIT) which launched a year after the CBI with a similar fee model, was single elimination.
In March 2021, the CBI brought a truncated field of eight teams to a bubble in the COVID-depressed surroundings of Daytona Beach, Fla. Giles said the Gazelle Group got a bargain rate from the city’s Hilton Oceanfront Resort, forming a partnership that has become all the more valuable now that business has returned to normal. (The CIT failed to survive the pandemic’s disruption.)
“We have 16 teams coming to one site,” Giles said. “The NCAA has eight teams coming to eight sites. I guarantee we run a much more streamlined, cost-efficient operation.”
While Giles still is an ardent believer in a postseason college basketball playoff, he says the logistics have made keeping the CBI in neutral Daytona too difficult to part with. But he thinks there remains an opportunity for someone to take note of the “swaths of empty seats” in the neutral-site arenas hosting the first rounds of the NCAA Tournament, and try to go a different way.
“What has happened over the last few years is a signal or sign that the (college sports) bureaucracy as it exists does not work,” Giles said. “Not in practice or the courts. That is why (the NCAA) came up with the transformation committee.”
The same goes for athlete compensation. For this year’s tournament, the CBI introduced a first-of-its-kind plan to reward winning teams with NIL money for their players—$40,000 to be split among the champions, $25,000 to the runner-ups and $2,500 apiece to the semifinalists.
Giles hopes these purses—which will likely now be distributed via NIL collectives—continue, and that the process of financially rewarding college athletes will become only less bureaucratic in the years to come.
“I hope that there will be dramatic change more quickly than there has been,” Giles said. “There was this great resistance to NIL. Now all of a sudden that is being embraced, and there is resistance to pay-for-play. Well, guess what? There shouldn’t be.”
