Deconstructing the NCAA’s Procompetitive Justifications to Demonstrate Antitrust Injury and Calculate Lost Compensation

• Published in: Antitrust bulletin Vol. 62; no. 1; pp. 184 - 236
• Main Author: Tatos, Ted
• Format: Journal Article
• Language: English
• Published: London Sage Publications Ltd 01.03.2017
• Subjects: Antitrust; College basketball; College sports; Compensation; Education; Federal court decisions; Rule of reason; Scholarships & fellowships; Sherman Antitrust Act 1890-US; Student athletes; Traditions
• ISSN: 0003-603X; 1930-7969
• DOI: 10.1177/0003603X16688968

Faced with significant antitrust scrutiny, particularly from ongoing cases, the NCAA has sought to justify, under the rule of reason, the competitive restrictions its collegiate model of amateurism imposes by claiming procompetitive benefits. This article examines the NCAA’s arguments and presents five findings: (1) the procompetitive justifications that the NCAA has offered for its restraint on athlete payments have little, if any, economic merit and do not justify the consumer injury resulting from the restraint; (2) absent the restraint, the minimum amount public P5 conference schools alone could have paid athletes is approximately $5.2 billion between 2003–2004 and 2014–2015, approximately two-thirds of which would have been used to compensate football and men’s basketball players, indicating that the consumer injury resulting from the NCAA’s restraint on trade has caused significant antitrust damages; (3) contrary to the NCAA’s claims, empirical and documentary evidence demonstrates that directly compensating FBS/D1 athletes would not result in decreased consumer demand; (4) “competitive balance,” when analyzed in an antitrust setting, does not support the NCAA’s claims; and (5) evidence, including the over one million documents released from the academic/athletic fraud investigation at the University of North Carolina at Chapel Hill, demonstrates significant consumer injury associated with the integration of academics and amateur revenue sport athletics. Such findings stand in direct opposition to the NCAA’s claim of procompetitive benefits from integrating athletics and academics under its amateur model.