After unveiling reform proposal, Congressional lifeline mission-critical for NCAA

In the wake of the NCAA unveiling its potentially ground-breaking proposal last week, attention now returns in earnest to efforts on Capitol Hill.

The roll-out of the bold plan – which would for the first time allow schools to directly pay players – is the NCAA’s clarion call to federal lawmakers. The NCAA hopes to at long last secure a reform bill that includes at least limited antitrust protection and codifies that athletes are not university employees.

For the NCAA, it is nothing short of mission-critical. 

Legal threats are mounting by the day – two more lawsuits were filed within hours of each other Thursday and it’s within the realm of possibility yet another one could be filed by the time you’re finished reading this story. At the same time, the employment train continues barreling down the tracks through ongoing proceedings in the courts and with the National Labor Relations Board.

Opinions surrounding the likelihood of Congress acting aside, SEC Commissioner Greg Sankey told On3: “We’ve got a responsibility to engage in that venue [Congress] given the complexity of what is now in front of us and decisions not to do certain things in the past.”

IN THEIR OWN WORDS: Do you agree with NCAA’s efforts to secure federal reform?

Sankey stressed that Congress is the “venue that can fully address the challenges that currently face college athletics.”

In recent weeks, On3’s reporting team conducted exclusive interviews with more than 50 leading college sports voices – commissioners, athletic directors, collectives, coaches, athletes, NIL and legal experts and others – to gather insights on the industry’s most consequential issues. As part of On3’s State of College Sports project, we will publish their responses, along with accompanying stories. 

We asked stakeholders shortly before the NCAA unveiled its proposal two questions about Congress: Do you agree with the association’s efforts to try to land a federal reform bill? And is it needed?

Before unveiling the proposal, NCAA President Charlie Baker told On3 that the association is indeed making changes but stressed that there are “elements outside the association’s control and that’s why there is an opportunity to partner with lawmakers.”

‘How do we keep all of Division I together?’

Putting a finer point on the NCAA’s efforts is Pittsburgh Athletic Director Heather Lyke, an ACC representative on the NCAA Division I Council. She told On3 that it is “really important to get a bill and to get antitrust protection. Keep kids as students and protect all of college sports. If we start paying them, Division II and III [are at risk], and how do you even keep all of Division I together? So many people couldn’t afford it.”

Some contend that college athletics finds itself in this predicament because it has long been resistant to change, clinging to an antiquated amateur model collecting cobwebs and failing to engage the athletes themselves to craft a mutually beneficial path forward.

“We have protected amateurism way too long,” Texas A&M Athletic Director Ross Bjork told On3. “We held athletes back from real NIL opportunities when it would have been much simpler. We haven’t sat down with our athletes and asked them, ‘What do you want out of this experience?’ We’ve done a lot of this to ourselves. That’s why the only viable entity, good or bad, is Congress because there has to be now federal oversight to have any sort of uniform standards.”

Walker Jones is executive director of the Ole Miss-focused Grove Collective and a leader in The Collective Association who has testified in front of Congress. He acknowledged that some of the items in a potential federal reform package are needed. Problem is, he said, “I have a hard time saying the NCAA is the one to do that.”

To no fault of first-year president Baker, Jones added, he inherited an organization that “through their ineptitude and inaction had lost all sort of trust and equity with the stakeholders in the collegiate space. And I just think that that’s where they’re going to run out of room. That is why I think some people are against the antitrust exemption.

“You are giving the organization that created a lot of these ills the power back, and the trust that they’re going to go fix it with the athletes’ best interests in mind when all they have done for decades is not have the athletes’ best interests in mind … I think they’re going to have a hard time getting that antitrust exemption because of decades of manipulating the marketplace.”

Many stakeholders told On3 that Congressional intervention is needed. Over the past several months, messaging from the NCAA, conference commissioners and athletics directors has emphasized the need for a reform bill to specifically address the patchwork of disparate state NIL laws that exist nationwide, thus creating an unlevel playing field.

But in some respects, that’s a red herring.

The two big-ticket items that the NCAA most covet – and views as essential – are antitrust protection and the codification that athletes are not employees.

What is conundrum confronting college sports? 

Oklahoma Athletic Director Joe Castiglione, who expressed his views to On3 shortly before the NCAA unveiled its proposal, painted the current state of play in college sports as a “conundrum.”

“Universities and conferences could and should be the ones to create a model. But because of the current climate, we’re absolutely limited in our capacity to come together as a group to forge a new structure,” the veteran administrator explained. “Without Capitol Hill action, we’re going to continue to be at the mercy of ongoing litigation or perhaps even new state laws that could eventually eliminate a university’s ability to fund broad-based athletics programs.”

Former U.S. Congressman Tom McMillen, the current CEO of LEAD1 Association, said if the NCAA could have lawmakers codify that athletes are not employees it would be the “trifecta, incredible if they can pull that off. I just think the Democrats are not going to jump ahead of the courts on that issue.”

Movement is afoot in the courts and with the NLRB. In Pennsylvania, plaintiffs in Johnson v. NCAA, former Villanova football player Trey Johnson and other Division I athletes are asking that athletes be deemed employees subject to the Fair Labor Standards Act. A Boston-based NLRB regional director is weighing the question of whether Dartmouth men’s basketball players are employees and can conduct a union election. Plus, a hearing in Los Angeles will begin Dec. 18 regarding the NLRB complaint against USC, the Pac-12 Conference and the NCAA, which alleges respondents unlawfully misclassify football and men’s and women’s basketball players as student-athletes.

At the same time, some Democrats are doubling down on athletes being designated as employees. Last Wednesday, U.S. Senators Chris Murphy (D-Conn.), Bernie Sanders (I-Vt.), and Elizabeth Warren (D-Mass.) reintroduced the College Athlete Right to Organize Act. That bill would affirm that college athletes are employees under the National Labor Relations Act who are entitled to the right to organize and collectively bargain for fair compensation and better working conditions.

READ: REVIEWING PROPOSED FEDERAL NIL LEGISLATION

None of the flurry of draft bills that have circulated over the last year has even gone to a vote. Whether one can ultimately pass – especially during an election year – is anyone’s guess. Ten Congressional NIL hearings – which often waded into broader issues – stirred discussion nationwide but seemed to accomplish little else.

College sports is not ‘candy store for these lawyers’

In the weeks before American Athletic Conference Commissioner Mike Aresco announced his retirement after the 2023-24 academic year, the veteran college sports leader sounded off on the perpetual legal threats now facing the enterprise.

“We are getting sued over nonsense – we just have to stop that,” Aresco told On3. “College sports is not the candy store for these lawyers – that’s how they view it now. The other thing about college sports, it is a unique endeavor. I’m so tired of people saying, ‘Treat it like just a business.’ It’s not a business – has never been a business. 

“Yes, there’s a lot of money flowing in. You have to have restrictions and limitations. If you have complete freedom of everything, you have chaos. And that’s where Congress comes in – give us some protection so we can pass national laws and not get sued.”

Put bluntly, Dan Lust, a sports attorney at Moritt Hock & Hamroff LLP and sports law professor at New York Law School, told On3 that the NCAA seems to want to use the federal government as a “shield.” He said that, “if you’re just weighing all the different daggers pointed at the NCAA, I think a federal law gives them some cover.”

House v NCAA could reshape everything

One of the most potent so-called daggers is being sharpened in Oakland, perhaps posing an existential threat to the NCAA.

There, U.S. District Court Judge Claudia Wilken – herself no sympathizer with NCAA arguments – is weighing in the landmark House v. NCAA antitrust case whether thousands of athletes in damages classes should receive a slice of the broadcast revenue pie and retroactive NIL pay.

Overall, what’s at stake in the blockbuster case is some $4.2 billion in damages that the NCAA and power conferences could have to pay thousands of athletes – a financial bill that would threaten the future existence of the NCAA as we know it. 

On Thursday, another antitrust lawsuit was filed, this one alleging that rules that prohibit schools from paying athletes violate antitrust laws. The plaintiffs – Duke football player Dewayne Carter, Stanford soccer player Nya Harrison and TCU basketball player Sedona Prince – who filed the complaint in the Northern District of California federal court are represented by familiar names, Jeffrey Kessler and Steve Berman.

The duo is once again a thorn in the side of the NCAA, having successfully sued the NCAA in the consequential Alston case and continuing to represent plaintiffs in the high-stakes House case.

Duke refused to let DeWayne Carter, one of three plaintiffs in the massive new lawsuit against the NCAA, speak on the record with the media. Carter acceded to Duke’s wishes. pic.twitter.com/9pCAJtunym

— Luke DeCock (@LukeDeCock) December 9, 2023

Federal help or bust for NCAA

Lawsuits are now coming fast and furious – as legal threats and fees are mounting by the day.

Expect the NCAA’s efforts to land a federal reform bill to intensify – many stakeholders view it as mission critical.

“We need some antitrust protection,” Tom Wistrcill, the Big Sky Conference commissioner, told On3, “or the lawsuits will become overwhelming, and schools will start dropping sports because the revenue from the conference media deals will all go to legal fees and settlements.”