Even after NCAA approves settlement in House antitrust case, key case, questions remain

The NCAA and all five power conferences approved a landmark agreement that will settle three consequential antitrust lawsuits – House, Carter and Hubbard – in a history-making development that ushers in the age of revenue sharing.

But for the NCAA, there is also this sobering reality: At least for the moment, it failed in its attempt to consolidate one more financially threatening lawsuit into the global House settlement.

The NCAA and power conferences argued that a Colorado judge should consolidate Fontenot v. NCAA with Carter, a similar case in Northern California. 

Judge Charlotte N. Sweeney had other ideas.

Sweeney ruled Thursday the Fontenot v. NCAA case would remain in Colorado and proceed outside of the House settlement – which was not the news the NCAA wanted to hear as it secured approval on the landscape-shifting agreement.

What does ruling against NCAA mean?

That ruling carries heightened significance because, in the coming months, U.S. District Judge Claudia Wilken will need to certify the House agreement. As part of the deal, athletes in the represented classes in the House case will be given the opportunity to opt-out of the settlement.

The plaintiffs’ attorneys in the House case have no concerns that athletes will opt out of the settlement in the wake of the judge’s ruling regarding the Fontenot case.

“None,” Steve Berman, co-lead counsel for the plaintiffs in the House case, told On3 Thursday afternoon. “It’s only continuing on a short-term basis. The judge made it clear that if there is a settlement going forward she won’t allow the case to continue. She can’t, as a basic bedrock rule of law, allow a case to go forward that’s been released by another judge. So, that case is alive for a nanosecond.”

In terms of potential athlete opt-outs in the House settlement, the settlement entails $2.8 billion being distributed to athletes in damages and up to $2 billion per year to start going forward – escalating as revenues rise – for a 10-year period.

“So, an athlete who opts out and forgoes all of this has to decide can they do better?” Berman added. “And must do so on an individual basis and not as a class. That’s a huge risk to take and a hugely expensive case to litigate. I think it would be irresponsible to advise an athlete to opt out in the hopes of getting more money.”

Legal expert curious about cases against NCAA

Boise State sports law professor Sam Ehrlich told On3: “I’ll be really curious to see whether other athletes – now that this [Fontenot] case represents an alternative – join up with this class rather than opting into the House settlement.

“Maybe it stays small. But if anything, this certainly weakens the idea that the House settlement represents an end to antitrust litigation against the NCAA over amateurism rules and bolsters any dissent – to the extent it exists – on the athletes’ side against the settlement. That can’t be extremely comfortable for the NCAA to hear on the day that I’m sure they were looking to start moving closer toward the settlement.”

NCAA hopeful but needs help from Congress

Nonetheless, the NCAA and the power conferences said in a joint statement that the House settlement “is an important step in the continuing reform of college sports that will provide benefits to student-athletes and provide clarity in college athletics across all divisions for years to come.

“This settlement is also a road map for college sports leaders and Congress to ensure this uniquely American institution can continue to provide unmatched opportunity for millions of students. All of Division I made today’s progress possible, and we all have work to do to implement the terms of the agreement as the legal process continues. We look forward to working with our various student-athlete leadership groups to write the next chapter of college sports.”

Interestingly, Notre Dame President Rev. John I. Jenkins called the settlement both “undesirable” and “promising.” But he, too, pushed for a Congressional lifeline – something that is yet to come and will become even more of the focus moving forward for the NCAA after the House settlement.

“To save the great American institution of college sports, Congress must pass legislation that will preempt the current patchwork of state laws; establish that our athletes are not employees, but students seeking college degrees; and provide protection from further antitrust lawsuits that will allow colleges to make and enforce rules that will protect our student-athletes and help ensure competitive equity among our teams,” Jenkins said.

However, Congresswoman Lori Trahan (D-MA) said in a statement Friday that she urges NCAA and conference leaders to give athletes a seat at the table.

“This agreement is a massive victory for athletes who create the value in college sports and deserve a share in the multibillion-dollar revenue they generate,” her statement said. “Over the past decade, college athletes have sued for violations of their rights in court, and they’ve won significant progress not just for themselves, but athletes everywhere. Rather than asking Congress to turn back the clock, college leaders should take this opportunity to embrace a future where athletes have a seat and a voice at the table when decisions are made about the industry built on their hard work.”