Monday, February 04, 2013
Judge: O’Bannon Case Can Move Forward as a Class Action
In a case that exemplifies the saying that "the wheels of justice grind slowly," a U.S. District Court judge in California, Claudia Wilken, last week denied the NCAA's attempt to prevent a group of former and potentially current football and basketball players from having their antitrust and image rights lawsuit classified as a class action. A certification hearing is now scheduled for June 20.|
The lawsuit was first filed in 2009 by former UCLA basketball player Ed O'Bannon, who claims that the NCAA's rules and regulations constitute anticompetitive conduct in violation of Section 1 of the Sherman Antitrust Act — in particular, that in order to retain eligibility to participate in athletics, the NCAA requires all athletes to relinquish all rights in perpetuity to the commercial use of their images, including after they graduate and are no longer subject to NCAA regulations.
If an athlete refuses to sign the form, he or she is not allowed to participate in intercollegiate athletics and could lose his or her scholarships. As a result, the former athletes claim that the NCAA's rules and regulations enable the organization to enter into licensing agreements with companies that distribute video games containing student-athletes' images without compensating the athletes for the use of their images, and thereby depriving the athletes of their rights of publicity.
The decision to allow the lawsuit to move forward has dramatically upped the stakes for the NCAA and its members. While the damages sought by the former players was estimated in the millions of dollars, by allowing the lawsuit to add current athletes and the value of current television revenue, the cost to the NCAA and its members could reach into the billions. In addition to the money involved, if the court finds that the NCAA and the schools illegally used the athletes' rights of publicity or violated the Sherman Antitrust Act, the decision could deprive the NCAA and individual member schools of a financial stream, while at the same time opening the door to direct financial compensation to college athletes.