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Sports Law
Fall, 2006
Notes: Legal Issues and Relationships in Amateur Athletics: Contractual and QuasiContractual Issues: Worker’s Comp.
-Waldrep case: employee vs. independent contractor (state law, but really
common law); result of unions and the entrepreneurs (it limited the employers’ liability,
through a cap) (there is a scheduled premium on a yearly basis); employees relinquish all
common law claims (they cannot sue), but they don’t have to fight to get worker’s comp;
employers give up all right to defenses, but will not have to pay more than the set cap;
only exception is an intentional tort (you don’t want the employer to be responsible for
the bad conduct of the employee)
-2 tests for worker’s comp: 1. nature of the work (economic reality) - are the
worker’s efforts inextricably linked to a specific aspect of the employer’s business; 2.
Right to control the work (did the injury occur in the course of the employment?) (Yes if
the employment brought the worker into the orbit of risk that resulted in the injury) (This
is very broad language)
-Is a scholarship athlete an employee of the school he plays for? They pay for the
education, but it could also be considered a job. But, it is also a choice.
-Waldrep: College football player. Suffered a spinal cord injury, filed a worker’s comp
claim (17 years later); claim was appealed because he was not an employee. His
response was that he put in a lot of time and it was the same as an employer-employee
relationship. He had signed a 4 year deal that would be given to him as long as he stayed
eligible. Texas Employers Commission said that he was an employee. He won at the
lower court level. Appeals court said he was not an employee.
-Issue is “Was he an employee of TCU?”
-Standard of review: Will only overturn appeals court if there is no way a
reasonable person could conclude that he was an employee.
-Appellate court looked to the NCAA guidelines, and not just the TCU
guidelines. Court said that the student-school relationship did not have the aspects of an
employee relationship. He was not on the payroll; and he was there to learn, not to serve
an employee. He did not get paid; but that was because TCU did not want him to get
paid. He would have been ineligible if he was paid (no kidding, the NCAA does not
want him to be an employee)
-Byers (executive director of NCAA)’s testimony was excluded. He had
said that student athletes were exploited and it was a sham to not allow worker’s comp.
Had this evidence been admitted, the result might have been different. It basically
becomes a professional league if worker’s comp claims are allowed.
-The conclusion of the court is that the decision should not be taken too
broadly.
-Articles of heat exhaustion: It is very difficult to diagnose. There are symptoms that are
across the board. You don’t know what is going on. Athletes placed in that situation
would not want to stop. Should the coach or the athlete be responsible? There is a limit
to how much the coach can do. “Out of season” and “optional” football practices are not
really optional. Should the athletes know there own bodies and bear responsibilities if
there are no coaches there? Rashidi Wheeler was a chronic asthmatic. It was chaotic on
the field when he fell down; they could not find the proper medical authorities. Should
they get in trouble for not having a viable medical plan? He had not taken his meds for a
while. They settled out of court.
-Korey Stringer: Lineman for the Vikings. Wife was suing for wrongful death.
His symptoms were going on for a few days and he was overweight, so they should have
known things could have occurred. Contend they did not provide a safe environment (not
enough doctors or trainers there). He had told them that he had nausea, and they said it
was nerves. He laid down on the field on the next day. In the training room, he was
sweaty. The response was slow and they were not taking him seriously (not even ice in
the ambulance). 108.8 degrees; he died in the hospital.
-Court of Appeals: This could be worker’s comp, but the trainers (whom
the suit is against) were co-employees, so they have immunity. Issue is whether the
trainers were responsible. Lower court: no immunity for co-employees if it was the
result of gross negligence. There is no personal duty running from the co-employees to
the victim when the co-employees are carrying out the employer’s duty to maintain a safe
workplace. So they won’t hold employees liable for the responsibility of the employer.
Co-employee has a personal duty only if they do a direct act that is outside of their
employment responsibilities. Lower court did not find gross negligence, because they at
least tried to take care of him, even though they failed miserably. Went up on appeal. He
was one of 11 players to be treated that day. Should have sued the Vikings and the NFL.
In order to show that a co-employee has a duty, you have to show that they acted outside
of the scope of their employment. Trainers were hired to take care of the players, so it
was within the scope of the employment.
-Result: Everyone revamps their training and health procedures. Have to have
someone who can cancel practice if the conditions are not safe. This will not work
though. Put restrictions and rules on practices. (Not in full pads, etc.). League makes
sure these rules are complied with.
-Duty to Educate (?): free market, so if they fail in this duty, you can go elsewhere;
what about if certain classes aren’t offered every semester; is this something that people
buy and pay for?
-Taylor v. Wake Forest (rights arising from an athletic scholarship): scholarship
player did poorly in school, left the team to focus on studies (so he lost his scholarship),
he stayed off the team even after he got his grades up, and sued to get his scholarship
money; there were athletic and academic prongs to eligibility; after he got his grades up
(enough so that he would be eligible to play), he realized that they would go right back
down if he went back to football; but if the did that, he would lose his scholarship; he
said there was an oral agreement that said he wouldn’t have to play football if his grades
were poor, but since he did not have any written agreement, the court ruled against him;
summary judgment for the university
-Ross v. Creighton: educational malpractice claim; player went to Creighton, and
he was assured that he would get tutoring help if he needed it; he stayed eligible to play
throughout, but did not get enough credits to graduate (also, other people were writing his
papers for him); he reading levels were still way below par; he would not have gotten into
the school if it weren’t for his basketball ability; his attorney said this was a case of
negligence and a contractual promise not be upheld (the court threw away the negligence
one)
-5 causes of action: 1) educational malpractice, 2) negligent infliction of
emotional distress (stressful environment that he was not prepared for), 3) negligent
admission to school, 4) contract claim (opportunity to obtain a degree), 5) contract claim
(provide a college education)
-district court says 1) is not in Illinois because the courts do not want to go
into the realm of universities (academic freedom), and because it would lead to way too
many claims being filed, and because education is very collaborative (there is not much
the school can do if the student does not learn the stuff)
-2) would be thrown out because he was not close enough to another
physical tort
-3) is thrown out because it is simply a policy issue, and because colleges
would be overly selective in admissions processes
-an agreement is needed to find any contract; he would need to establish a
specific thing that was owed to him (in exchange for playing basketball)
-Appeals Court only takes the contract claims into account; meaningful
opportunity to obtain an education could be solidified as a contractual duty and a claim
could be based on this; remanded to see if there was any real access to an education at all
other than to play basketball
-Problem: Isn’t the Appeals Court’s decision to remand a decision
regarding the quality of the education in itself?
-Jackson v. Drake: basketball player was upset with how the basketball team was
run after it got a new coach; coaches tried to get him to turn in papers written by other
people; practices coincided with his class times; he said University owed him the
opportunity to play basketball (is this really true?); court rejected that they owed him an
atmosphere conducive to getting an education; motion for summary judgment denied for
the fraud and negligent misrepresentation claims (said if the school didn’t keep promises
or defrauded him, they screwed up)
-Fiduciary Duty: Hendricks v. Clemson: college baseball player went to his advisor to
make sure he would be eligible to play (50% of credits need to be toward his major); he
had gone to St. Leo’s, and his former major was not offered at Clemson; the advisor
screwed up and admitted it; he filed a suit alleging improper academic advisement (after
the team won the title that year); (his coaches said that he wouldn’t have played anyway).
Lower court entered summary judgment for the university; Appeals Court said school
didn’t owe him a duty of care, there was no fiduciary duty between advisor and student,
student didn’t point to any promised that was not kept, and breach of contract claim could
not proceed; student really did rely on the advice of the advisor (should he have?)
-4 issues of appeal: was there any duty; was there a fiduciary duty; was there a
contract of any sort; did he suffer any measurable damages?
-there was probably not any gross negligence in this case; court said no duty,
because it would get into education malpractice, which is bad
-fiduciary duty: no
-breach of contract: what kind of K would it be? He could not really identify any
specific contractual promise that was not kept
-measurable damages: no, because there is really no way to measure what the
damages would have been
-Sain v. Cedar Rapids: got offers to play college basketball; his English requirements
were not up to where they should have been; he sued the high school for not giving him
adequate advice; court said that the counselor person in the profession of supplying
information, and that the relationship was such that the counselor had to give good advice
to the student; student only found out from the Clearinghouse that he was not eligible
after he had already graduated; guidance counselor took an affirmative act by saying that
he should take a specific course, and it was not approved because the guidance counselor
had not submitted the course for approval in the first place, like she should have done
-he sued the school district (to get the scholarship for school that he would’ve
gotten) and the NCAA (because essentially he wants to play)
-is the school district negligent for failing to get the course approved? Lower
court said no, because it is essentially the same as an educational malpractice claim;
appeals court reversed (is it a better case for the plaintiff since he is still in high school,
since the student does not have a lot of experience in filling out admissions forms? Is
there more of a duty, due to the circumstances?)
-does this claim involve the same policy concerns? Probably not, because there
won’t be the same glut of claims that will be made; it doesn’t require the court to enter
into the day to day operation of the schools, and it is not the same thing as educational
malpractice
-negligent misrepresentation claim: there needs to be a duty; be in the business or
profession of supplying information to others, and is aware of what information will be
used for (yes, in this case); she would understand what would happen if the information
was wrong; is a guidance counselor getting paid to supply information? Well, this is an
advisory relationship, not an arms-length one
-saying, “Yeah, its ok, take it” was wrong; there was not a special relationship (it
was more of a supervisory role), so there was summary judgment on that case
-no duty to submit list to the NCAA (it is a policy decision)
-so there really is no right to play college ball or a scholarship or guidance
counseling
-A national letter of intent is a contract; you are limited to its terms; but that’s all that it
is; so you can draft a complaint, but it’ll probably not work; educational malpractice will
not fly; fiduciary duty will not work; fraud re: educational malpractice may work
-Amateur Sports Associations: 2nd-ary schools (public and private), independent
organizations, collegiate, and Olympic; there are constitutional issues for these; ***Is it
state action? Is the question to ask!!! (If it is a private action, there are no constitutional
issues); 5th and 14th Amendments (EP and SDP and PDP); if it is not state action, private
association law comes into play; courts will not usually intervene if it is private action
(only will if there is fraud, illegality, arbitrariness/capriciousness, the own body violated
its rules)
-The NCAA: Is it a state actor? No, because it is a private organization; People think it
is a state actor because it influences a lot of different people in a lot of different ways (it
touches on individual liberties)
-What is its membership? 55% public, broken up into 3 divisions, there is an
Executive Committee (set the rules, write the manuals, set the budget, pick the CEO, do
the planning, do amendments), there are specific committees; the purposes are to ensure
that student-athletes remain amateurs and student, and to provide a system of inter-
institutional control and development; it formed because T. Roosevelt wanted to regulate
intercollegiate athletics; to be eligible as an amateur athlete: cannot take money, cannot
have an agent; cannot have received compensation for your athletic activity in your sport,
cannot be promised to be paid later, cannot sign a contract to play professionally (even if
it is not enforceable), cannot receive things from boosters, cannot play pro even if not
paid, can enter draft if you follow the proper procedures in basketball and football (no
agent, not drafted, sign petition to get reinstated in 72 hours), cannot sign K with agent,
cannot get an agent’s advice on the draft status, can have an agent for one sport and still
be amateur in another if you are very careful and specific, there are restrictions on what
charities or magazine covers, or work you can do
-Jeremy Bloom case: football player and skier; wanted to receive money from
endorsements for his skiing while still playing college football; sued the NCAA to be
able to do this; he needed the money in order to still do his skiing; NCAA said it would
be hard to discern if he was getting his money just from his skiing, looks, etc.; Bloom
says he is a 3rd party beneficiary to the K that goes from the NCAA to its members; the
rules that they have to abide by is the contract; Bloom says the bylaws regarding
endorsements are arbitrary and capricious; Bloom says it is a restraint on trade
-court says he is a 3rd party beneficiary, but to get an injunction, he has to show
that he suffered irreparable harm, likelihood to succeed on the merits, no other remedy at
law, and that it would survive the status quo
-irreparable injury was that he would lose the season, and that there was
no other remedy at law; but, he was not able to show a likelihood of success on the merits
(because the bylaws serve the purpose of reserving amateur status of the athletes) (and
because he cannot show that the NCAA is not being consistent in enforcing its rules)
-not the same thing as when a school has a commercial endorsement
-Freshman Eligibility Rules: 1986-Freshman required to have certain GPA’s to stay
eligible; they do this to try to prevent problems where students have bad GPA’s while
playing (the public sense is that things were out of control); there are minimum entrance
standards; they have to take certain courses; if you are a qualifier, you can practice, play,
and get scholarship; partial qualifiers cannot compete as freshman and only get 3 years of
eligibility; non-qualifiers get no aid, cannot play or practice, and still only have 3 years of
eligibility left; in order to do this, they made the NCAA clearinghouse (centralized
institution that looks at each individual case); the big issue is which courses will meet the
requirements; need to be a full-time student in good academic standing and get four years
of eligibility in a five-year span; there are also institutional controls (set rules for fair
play, have an enforcement arm, set limits on contributions and recruiting [limit what
coaches can say, so the NCAA will not be hauled into court if coaches do not fulfill
promises to kids], boosters cannot recruit (because they cannot be controlled), restrict
practices and games and tournaments, control certain tournaments and championships)
-So is the NCAA a state actor?
-Tarkanian v. UNLV: NCAA investigates UNLV because it won so much; Tarkanian
was involved in 10 of 38 rules violations; he interfered with the investigations and he told
his players not to talk and to lie (he also fabricated evidence); so the NCAA had no
choice but to come down hard on him; 2 years probations and get rid of Tarkanian; Tark
brought suit in state court in 1977 saying that NCAA was acting in an arbitrary and
capricious manner and tried to get an injunction; 7 years later the district court got it
(meanwhile, he is still coaching); district court upholds, saying it was state action; NCAA
appeals to Nev. Supreme Court and lose; goes to US Supreme Court (5-4 decision),
which reverses and finds state action (said that there was not something about the
relationship between UNLV and the NCAA which makes the NCAA a state actor)
-the meat of this case is how they view the NCAA and how powerful it is and
what its position is among its members; did UNLV’s actions in compliance with the
NCAA’s rules constitute state action?; membership makes and adopts the rules
-NCAA is not a state actor that deprived Tark of liberty and property (his job)
-UNLV retained the power to walk away from its relationship with the NCAA
-was it state action because UNLV delegated power to NCAA, making it state
action? No, because the NCAA could not directly fire Tark (UNLV had to, or else get a
show-cause issued)
-UNLV and NCAA are adversarial, even though they are co-defendants
-is the option to leave the NCAA really a viable option? No, because there are no
other real alternatives because they wouldn’t be able to play anyone
-it’ll lead to a lot of litigation if the NCAA is found to be a state actor, because
everyone will be able to bring cases; that UNLV’s options were not good does not mean
that they were not existent
-Cohane case: NCAA told UB to fire Cohane; said that it was not state action because it
was on behalf of the entire NCAA membership
-NCAA v. Miller: these 4 states didn’t want the NCAA interfering with their football;
NCAA got the state statutes declared void as against the Commerce Clause because it has
a direct impact in interstate commerce and business
-NCAA is a private association and not a state actor
-***NCAA’s enforcement mechanisms: College President is responsible for compliance;
full time staff for the NCAA investigating this; found out by self-reporting (they’ll go
lighter on them), anonymous tips, media, whistle blowers, NCAA staff; evaluate
information and factors: severity, recidivism, credibility, evidence; allegations are either
substantiated or not; if they are substantiated, a formal notice will be sent and a formal
investigation will be commenced
-***If you are told something is wrong at your institution by an anonymous tip, you
should investigate yourself and say to people, “You will want to have counsel” and take
notes that will not be discoverable (say they are privileged and confidential), and draft up
some sanctions for yourself (this is what went wrong, we have taken steps to correct it, it
will never happen again because we fixed it, and this is what our punishment should be),
you can appeal the decision (but you want to think long and hard about doing it)
-penalties: loss of scholarship, no postseason, and team gets killed
-HYPO: You are counsel for NCAA compliance division; you get info that an institution
in DI is possibly breaking rules. What would be important in the investigation? Make
sure you follow the correct procedures, so that you don’t lose on a technicality; first step
procedurally would be to think about who gave you the info (if it was the university, you
will probably cut them some slack, since it looks like the program in under control) (if
they self-report but do not tell you everything that is going on, then you will have to start
your own investigation, so that you will be sufficiently tough and will not break your own
bylaws [it will look bad for you to go after one hard while not going after the other]); you
should look at the past history at that university when it comes to rules (this matters for
credibility issues); see how pervasive this is at the university and how long it has been
going on (if it is pervasive, either they weren’t aware of it or they weren’t paying
attention, or that the leaders of the administration wanted to do things to break the rules);
look at how honest they were; if the media reports it, immediately seek out the parties
that are involved and figure out how truthful the allegations are (you will also probably
be harsher because they didn’t self report) and tell everyone to get an attorney (since
there will be a conflict of interest); in fact, always advise each party to get an attorney to
make sure that things are not compromised; make sure that you take notes on all of the
proceedings; then get all of the points of view and ideas and then give an honest
assessment; your primary objective is to preserve amateurism; personalities are relevant
because they are a fact of life; come up with an effective solution but keep in mind that
this decision will have an effect on many other people and institutions; if they self-report
or if it a small infraction, you probably want to go easy on them; if you do a harsh
penalty, it will lead to negative publicity on the whole NCAA; then hire a PR person to
put a good spin on it
-Bassett v. NCAA: failure to do own bylaw, fraud or illegality, or arbitrary or
capriciousness will lead to actions; make sure it looks as though some rudimentary due
process was granted; coach was told resign or else worse things will happen; coach
resigns and they investigate; he wouldn’t comply with the investigation so the NCAA
makes sure no one else will sign him; tortuous interference with the K with the university
is the only one that survives; court said NCAA had an incentive to do that since others
wouldn’t do it in the future; court said the coach agreed to abide by it when he signed his
K; also, the court said there is an interest in self-reporting; court was bothered by the fact
that he lied; court granted summary judgment for the NCAA
-Brentwood: whether a state-wide athletic association among private and public schools
is engaging in state action when it enforces its rules against a member school; it is a
private school; TSSAA was not for profit and not mandatory, but pretty much everyone
belonged to it; school districts are paying the salaries of the people on the TSSAA, and it
was founded by the state board of education to promote athletics (so it would seem to be
state action), but they changed the wording after figuring out that they screwed up in
1996 (after Tarkanian); the wording said that they were authorizing schools to voluntarily
join it (after everyone was in in the first place!); school charged with violating undue
influence rule; Brentwood said that this is state action and not allowed; lower court
agrees with Brentwood because it found a symbiotic relation between state and TSSAA;
appeals court reverses this saying that the state doesn’t traditionally serve this function
and says there is no forcing; Supreme Court says “there is state action only if there is a
close nexus between the state and the challenged action that seemingly private behavior
may be fairly treated as an action of the state itself (close nexus means entwinement, an
extremely close relationship between the parties); there is no one fact that makes it
definitely state action, and even if there is, there may be a countervailing reason to ignore
it;” the court says the state legislature passing a law is not enough; there is pervasive
entwinement between state actors and the parties; in this case, it looked and smelled like
state action, so we are finding it in this case, but we might find another reason why it is
not state action; court says athletics is not a traditional state function (Thomas dissenting
says it is; he says we have not done anything like this before); so court remands
-Olympics: IOC-non governmental agency, but is dependent on international
cooperation; discipline and eligibility
IFs: IOC’s delegates for the specific sports; buffer between IOC and countries
agencies; countries do not have jurisdiction over them
NGB’s: USOC- participation of the nation; participation; created by Congress;
Amateur Sports Act of 78- no private cause of action for an athlete (they have no
recourse), Athletes’ Bill of Rights was not added
Olympic Congresses for specific Olympiads
US Courts have deferred on matters pertaining to the Olympics (there would be a
jurisdictional problem and because it is a privilege and not a right, and because they have
to exhaust remedies through itself, and because it is not their function)
-DeFrantz: this was around the time of the Cold War; Carter said we are not going to go
to the Games (strongly recommended it to the USOC); athletes wanted to go, since it is
their one shot; athletes tried to find a private cause of action under the Act; court says it is
not state action; there is not a symbiotic relationship that would make it state action
because there is no money changing hands; the USOC could have not listened to Carter
(but this was not really a viable option for the USOC); voluntary association, so no state
action, so administrative law applies (if it is state action, 14th amendment comes into
play); recently, courts have been less inclines to defer
-Butch Reynolds: track star who tested positive for drugs; no due process remedy for
him until he exhausts all of his administrative appeals; federation conducts its own
inquiry and says he is guilty; it might be arbitrary and capricious because it might have
not been his urine; federation (IAAF) does not appear in court because court doesn’t have
jurisdiction; positive in Monaco, results done in France, released in England, he lives in
Ohio, so there is no jurisdiction; there were no major contacts in Ohio that Reynolds
could point to (the only thing was some after the fact letter); 3 part test for jurisdiction:
must be some action that the federation is taking in Ohio, must be some activities in
Ohio, acts and consequences must have a substantial connection in Ohio; neither of these
were met in this case; court said this could lead to a slippery slope, meaning that IAAF
would be able to be hauled into court wherever an athlete lived
-Walton-Floyd: husband buys wife supplement and calls USOC hotline to see if it is
legal; he got it from Hans in an unmarked container (no list of ingredients); he is told that
it is just a supplement and that it is okay to take; she calls back a bunch of times to make
sure it is okay; she wins the championships; she gets banned from amateur track for 4
years; it turns out she was taking an amphetamine; they sue the USOC, saying they had a
duty of care and didn’t follow it by telling her it was okay to take; she shouldn’t have
taken the chance; sue USOC for negligence; USOC didn’t have pecuniary interest in
supplying the information (it was only done as a service to the athletes); USOC got
summary judgment; Walton-Floyd appeals saying they should be responsible under
breach of a reasonable duty of care (meaning, regular negligence); 98, amateur sports act
amended, saying courts cannot do injunctive relief against USOC within 21 days of
Olympics (this is to keep courts out)
-CAS: appointed by the IOC; it has been revamped to make it more fair; ordinary
division, appeals division, and Olympic division; athletes have to sign a waiver
submitting to CAS; people cannot give away constitutional rights, so this may be a
problem
-dispute process set up may have a jurisdictional problem
-when do courts intervene? Fashy: swimmer; tests positive for steroids; USS says tests
were good but she really had no idea how it happened; they penalize her; swimmer files a
suit to stop the penalties; USS says there is no jurisdiction; there are stringent procedures
for drug tests; she couldn’t get another test from a 3rd lab; USS says once we find a
positive, we will punish (even if we get false positives); courts intervene to prevent this
-Lindland: Lindland fighting Seracky to determine who will represent the US; Seracky
won the first one; arbitrator ordered a new match; Lindland won 2nd match; Seracky got
another arbitrator to rule in his favor; USA Wrestling supports Seracky, the initial winner
(for credibility reasons, so that it will not lead to a slippery slope where everyone can
fight decisions); USA Wrestling sends the name of Seracky to the USOC, while the
arbitrator says Lindland should be sent; USOC rejects Lindland; Lindland tries to get an
injunction, and Seracky goes to a different district court; cases combine; Court wants the
USOC to substitute Lindland for Seracky; USOC says arbitration award for Seracky was
not something he legally could have done, so the arbitrator should not have accepted
jurisdiction; also, when the first arbitration decision came down, that should have been
the end of it; was the injunction requiring Seracky’s name to be sent binding on the
USOC? Yes, and they are required to obey it; the 21 day before Olympics rule does not
preclude this decision
-Lazutina: Russian cross-country skier; caught doping and appealed, saying the
procedure was not correct; as the test was being done, she won a medal; could she point
to any hole in the procedure? No; court said that it was a meritless claim, so she had to
pay the court costs
-Ohio Taekwondo: internal grievance filed, saying they violated their own bylaws; does
the court have jurisdiction over this? Three tiers: have to exhaust all other remedies, can
file complaint with USOC, adverse USOC claim can be reviewed by American
Arbitration Association; do you have to do all three to get to court? Yes, so that you do
not burden the courts; courts want to stay out of Olympic issues; courts were not
compelled to intervene in this notice claim
-Eligibility Issues: Danny Almonte- 14 year old pitcher was playing in the Little League
WS when people shouldn’t have been more than 12; teams who he was beating were the
first ones to start looking into it; SI finds out about it (multiple birth certificates); Little
League looks into it themselves and suspend people and take away the wins; Little
League really had no choice but to enforce its rules
-Free Speech: Avant: freedom to move; he was a senior and transferred; people think
kids would just go to the school with the better team; rule says that if you transfer you
have to sit out a year if your parents didn’t move with you to another district; he went
from private school to public school in the same district; he applies for eligibility under
the hardship rule, and the association says no, since the money situation in the family did
not change for 5 years; he gets a temporary restraining order and the court buys his
arguments; student cannot be denied arbitrarily, so were they arbitrary in this situation?
That is a question of facts, and in this case, athletics was a factor; is there state action?
Association says we are not state actors, but the court disagrees and says equal protection
does apply; when drawing lines, there needs to be a rational basis for the lines, and
everyone has to be treated the same way; court says the rule is okay because it is
reasonably related to preventing school jumping and everyone is treated in the same way
-Clemson kid is raising his little brother because his mom has drug issues and his dad is a
gambler; the issue is if he can take money due to his eligibility concerns since he is on
scholarship; if you allow this kid to do it, you open the door to other people in somewhat
similar situations; the NCAA is in a tough situation here; he eventually did get the
waiver; what can you do if you are in this situation? Are there any other relatives who
can do this? Can’t you get welfare or something like that?
-Academic requirements: Tiffany: does a high school student have a constitutional
right to play sports? If it is in an Individualized Education Program, then you are entitled
to it; does everyone get to be the quarterback though? Isn’t it above and beyond the
regular curriculum, so isn’t it more of a privilege than a right? You go to school to learn,
not to play sports; cannot attach requirements to constitutional rights (and that happens in
sports, meaning you need to attain a certain grade); he was too old to play, and it was
ruled that he couldn’t play, even though he was held back in kindergarten because he had
a learning disability; he said what the board did was arbitrary and against its own bylaws;
the court didn’t even touch his hardship, it simply said he had no constitutional right to
play; hardship rule allows them to waive their rules in special circumstances; board says
no exceptions (so they are not being inconsistent, but they are being arbitrary and
capricious, because they have a hardship rule but are choosing not to use it); athletics is
important, but it does not rise to rights
-Does the athlete have a K relationship with the NCAA? If so, what is the basis of the K?
Minimum requirements set out in the Letter of Intent; is the athlete a 3rd party beneficiary
between K’s between NCAA and the universities?
-Phillip: He doesn’t have the minimum number of core courses needed to compete; he
gets an injunction from keeping the NCAA from interfering in his right to play; he gets it
because he would suffer irreparable harm; he says he is likely to prevail because they
breached their duty to grant him a waiver by acting arbitrarily; to get injunction:
irreparable harm, no adequate remedy at law, balance of harms in claimants’ favor, likely
to win; lower standard applies; the K claim is that he has a scholarship to play but the
NCAA says he cannot use it; he says NCAA usually does grant waivers, so they should
have in this situation; court expresses no view whether duty existed, but then they said in
addition to arbitrariness, you also need to show bad intent; here there was no bad intent,
so cannot uphold lower court order; why is bad faith necessary? Courts usually do not
find bad faith, so counsel screwed up by doing K claim instead of private association
claim
-Yeo: very good Singaporean swimmer; her coach said, “I am going to Berkeley, come
with me.” Then they leave Berkeley and go to Austin. She can go there, but has to sit
out a year. She had to sit out while she was enrolled in school. She competed for 6 extra
events so she had to sit out 6 more later. She is claiming that her reputation is being
tarnished. She pleas for sympathy and loses. She says that she is an exceptional case,
and it is the degree of her stature that means she should win; court says it depends on the
nature of the right, and not the degree; court says there is more of a right for a graduate
student than for an athlete; court says they should stay out of student-athlete disputes
-Williams: basketball player; he kept dropping and adding courses at different JC’s so
that he would have enough credits to be able to play; he was receiving unfair benefits and
got bogus grades for his classes; they withdraw his scholarship since he could not play;
court says he screwed himself; NCAA found out about this because there were way too
many people involved; he gets interviewed and lies during the investigation; UC comes
up with a 7 point plan to deal with this, but they blame the fact that he arrived too early in
Cincinnati (so they are in denial and haven’t really fixed anything); they got him to admit
that he got a car ride home; they say he should be reinstated, but the NCAA says he
would have to miss most of the games; he drops out eventually and sues UC for many
different things; court looks at the breach of K claim and says the NCAA was the one
who said he couldn’t get the money, so there was no reason to sue UC; defamation claim:
it was the truth, so no defamation claim; he says they should be liable for doing wrong
things, court says too bad; intentional infliction of emotional distress and conspiracy do
not fly either
-academic requirements: academic progress rate track progress for each student-athlete
on whether he can play; there are exceptions to this as well
-Race: Pryor v. NCAA: Prop. 48 set minimum SAT scores for athletes, so that
graduation rates, especially for blacks, would go up (it accomplished this goal). Can you
voluntarily adopt an affirmative action program? No, because you would have to be
admitting past discrimination (which you cannot do). Cureton court found that Prop. 16
is illegal because there was no controlling authority over the schools by the NCAA in
determining athlete eligibility; district court grants motion to dismiss; they say it is not
intentional discrimination; Prop 16 was adopted in spite of, not because of racially
discriminatory things; it didn’t prevent any player from doing the National Letter of
Intent, it just put another condition onto it; more stringent standards on incoming
freshman eligibility; title 6 cases only apply to intentional discrimination; Pryor also had
a disability problem (she tried to say that the NCAA intentionally discriminated against
black applicants); did the NCAA know what the consequences were?; goals were higher
graduation rate; do the ends justify the means in this case?; they would want to make sure
students were qualified enough to graduate before even letting them in in the first place
-Is this intentional discrimination, since they know they will have fewer black
athletes? Are they doing it because of, or in spite of...? Does it make a difference that
black female athletes graduate at a higher rate than black female non-athletes?
-It is a facially neutral policy. Court will not assess whether there was
discriminatory purpose. NCAA says they should not be liable, since it was a benign
intent. Court says that is wrong reading, and that even a neutral policy that discriminates
on the basis of race still has to survive strict scrutiny. Court says even extreme
indifference does not mean intent. Hard standard to meet. 1981 contract claim will be
allowed because propositions will be part of the contract (even though they are
preconditions of it). (They are preconditions because you cannot get to an NLI without
first clearing the hurdles of the propositions.)
-Warde Manuel: big legal issue is the severance packages given out if someone in the
athletic staff is fired
-Knapp: basketball player who has a bad heart; has full basketball scholarship; school
does not want the liability; should they just let him sign a waiver saying he won’t sue the
school? (But that may lead to bad press for the school) (What if he died due to the fault of
the medical staff?); if they don’t let the kid play, other kids may hide problems in the
future; the waiver could actually lead to liability, because it could be argued that the team
knew about risks
-is this kid disabled? His disability isn’t one that affects him 5% of the time; it is
really the case that he is okay or else he is dead
-court is basically saying that basketball isn’t the only thing this kid has going for
him; and saying that Northwestern did right by him; the experts were really split on the
issue, so there really isn’t one right answer; whether he was otherwise qualified
individual with a disability
-must prove: he is disabled, he is otherwise qualified, excluded solely due to
disability, and that the thing receives money
-does it affect major life activities? Must show there is a physical impairment that
affects one or more major life activities; he says playing ball is a major life activity (this
is a subjective definition); other side says it is only basic functions; whether impairment
is a substantial limitation ‘for that person’ a major life activity (this part definitely is
subjective); court says no to the kid because playing basketball is not a major life activity
for everyone (court makes it objective); to prove otherwise qualified, you must show that
it is a substantial limitation to a major life activity
-major life activity of learning does not include playing ball; court says he isn’t
otherwise qualified because he is not physically qualified to play (they do not put it in
disability terms though)
-court says decision should be left to the team doctors as long as there is sufficient
evidence and it is a rational and reasonable conclusion and reasonable accommodations
were looked into
-case is inconsistent and its rationale is poor
-Sandison: 19 year old with a learning disability; he was held back early in school; rule
is you cannot be 19 before September 1st of the year; so there is no way that they are held
back to gain a competitive advantage (since it happened so early); this was more an age
question than a disability question; purpose of the age limitation is protection to other
athletes and to keep things fair; track does not lead to injury if the kids are older; court
says they are not disabled, they are not otherwise qualified (which you don’t get to unless
you are disabled); court should have thought that “but for their disability, they wouldn’t
have been held back”
-if the court would’ve applied the statute correctly, they would’ve not gotten to
this outcome; if kid is disabled, otherwise qualified, thing gets money, and kid was
discriminated against solely due to disability, next step is: are there reasonable
accommodations? No if it is a fundamental alteration or an undue burden
-court says they are not discriminated because of disability, they are discriminated
because they are too old (but if this is the case, the rest of the act does not apply and the
court should not have talked about it)
-Johnson: hearing problem, so he started kindergarten late; no a ringer, since he started
playing late; they say it is not waivable because it is essential; title 2 of ADA applies to
public entities; title 3 applies to disabled people and private entities of public places, and
def. is a private operator of a place of public accommodation; are reasonable
accommodations available that would not fundamentally alter?
-is he otherwise qualified? It is a public entity? Is he an individual with a
disability? Are there reasonable accommodations that would not fundamentally alter?
-it definitely is a public entity (so it is title 3); he is not the biggest kid and not a
star, so it would not fundamentally alter
-Cruz v. Penn.: turns 19 before cut off, so they say that he is not able to play sports; court
lets him play after balancing interests regarding the reasons for the rules; he was not big
at all, so he wouldn’t hurt the other competitors; he had a learning disability and an IEP;
Cruz was reading at a 3rd grade level in high school; involving him in extracurriculars
allows him to maintain social interactions with other students; problem is that if the IEP
does not state that football is necessary for development, there will be problems proving
that they are necessary for him to succeed in school; IEP is like a contract (it states what
your educational experience must be); IEP doesn’t reference sports specifically, but it
sort of does refer to sports improving his self-esteem; court says he will suffer irreparable
harm if he is not able to play; they say the waiver is reasonable and would not
fundamentally alter (they do this on a case by case basis, which is a subjective and
different standard than what was used before); they allow him to play
-Bowers: football player with a learning disability; nonqualifier; schools no longer
pursue him as hard; claims: title 2 claim against Iowa (he is disabled and more facts are
needed to see if his denial was due to his disability) (court says NCAA provides the
waivers, and he would be qualified if he met the aspects; he cannot meet them; Iowa
cannot change the rules because NCAA has the power to enforce the waivers); title 3
against NCAA (problem is title 3 applies to public accommodations; he was told he
couldn’t play; under the ADA, he needs to show that he was denied access to a place of
public accommodation, which he cannot really do; they’re not telling him he cannot go to
school, they are just telling him he cannot go to school); the board does not let him
qualify because he would not be able to handle the workload (so he doesn’t get a waiver);
NCAA is not a physical place, but it could be argued that it operates these things; but the
control is not direct, since it is done through the schools; *to the extent that clearinghouse
rules and threat of NCAA sanctions for playing nonqualifier dictate school’s choice to
not pursue nonqualifier may mean NCAA operates place of accommodation for our
purposes (this is a complete reversal from Tarkanian!)
-Ganden: swimmer with bad grades; needs to be competing against good people; can still
practice but cannot compete in meets; he says loss of season will be irreparable harm;
needs to prove disability, it is an entity that leases a place of public accommodation, and
he was discriminated on basis of disability; other side needs to say that it was not
necessary or that plaintiff was denied due to disability and defendant did not do
reasonable accommodation which would fundamentally alter it; his window is closing;
this would open the floodgates; court says it does place of public accommodation
-Matthews: football player; learning disability which makes it hard for him to read and
write; he needs to make reasonable progress toward a degree (75-25 requirement); taking
lesser course load, he still is failing, so he is denied a waiver; he sues; plaintiff can say he
has a disability and that he is being disabled on the basis of it, but he has problems
showing it is a place of public accommodation; maybe NCAA does do place of public
accommodation
-Martin: golfer who has serious leg problems; if they tell him he cannot use the cart, he
will not be able to play; he wins in the lower levels; they say golf place is a place of
public accommodation during play; they do a subjective standard; circuit court says he
can use the cart; goes to the supreme court; is golf course place of public
accommodation; would using a cart fundamentally alter the game?; this could lead to a
slippery slope if one person is allowed to ride; allowed to ride in senior tour (and it is still
real golf); golf course are listed as places of public accommodation (even though PGA
says they should not be, since there are white lines marking where people are allowed;
limited access); court says it is a place of public accommodation; Martin has to pay
money to compete and meet Q school requirements; is he a consumer or a performer?;
they say he is a performer but not an employee; he is definitely disabled and he was
discriminated on account of disability; would using the cart be a fundamental
alteration?*; court says no; but, what about other sports? (Once you alter rules of play,
where will it stop?); in majority opinion, the bottom line is that it would not
fundamentally alter the game (it was peripheral)
-Restitution Rule: school gets penalized and has to forfeit games; there is a disincentive
for the student not to sue (but, kids have no choice and are stuck, so why do this?)
-Jessa Martin: high school girl bball player; transfers; lives with former coach and wife;
subject to the transfer rule; allowed to only play JV; loses last year of eligibility; appeals
but is not granted a waiver; wins on appeal but the school is afraid of letting her play,
because it may have to forfeit games; she says she is not able to get the benefits of the
injunction if this happens (she says it is contempt of court); this is similar to Tarkanian,
because the rule is not forcing her to sit out, the school is!; it is not a private association,
so court said she could’ve pursued other actions; for the contempt of court, there is a high
barrier because there are serious consequences (need to show they willfully disobeyed a
specific court order) (the language in this case is too broad to prove contempt of court);
even though the court found in her favor, it did her no good due to the restitution rule
-Gender Equity: relief: 14th Amendment EP clause (only for state action, so not for
NCAA), state title 9 and state equal rights amendments, title 9
-14th: Hoover: soccer case; she was the only girl on the team; she could only play in JV;
they said soccer was a contact sport, and so there was a major injury risk for girls; they
were trying to protect the girls; if she wasn’t skilled to begin with and able to handle it,
she wouldn’t have gotten onto the team; the rule is facially discriminatory; this is state
action; rule is based on a false premise (that are girls are smaller than all boys); there
were no other eligibility criteria (small boys could play); the rule is irrational, because if
you really are all about well-being, you would make it so that small boys couldn’t play;
intermediate scrutiny, so you must have important objective that is substantially related to
the classification; screening does not further the governmental objective; separate but
equal is okay here because there would be no stigmatizing (like there would be for race)
(this is not true); court decides to give the school options (don’t have team at all, let girls
on guys team, have girls team)
-Title 9: Williams: he was playing field hockey but high school only had girls’ field
hockey; he has to show that policy was not necessary and not justified by preventing past
discrimination; school says boys are better, so girls will lose spots on team (but not many
boys wanna play field hockey); court says you can treat them differently if there really
are differences between the sexes; it is not relevant that few boys wanna play; this is fact
based and based on a state statute
-state statute: Blair: skewing the funding of scholarships; they have to get to a point of a
relatively equal split (but they take out football); if you take out football, the budget goes
way down; so they are not really similarly situated; so is it okay to pull football out of the
calculation? No, because it'll never be equal them; Washington State was found in
violation, but the lower court gave an injunction; it is irrelevant that they do it for
business purposes; but it is okay for the sports to do their own revenues (says appellate
courts)*; women’s teams will not be able to get as much as men’s teams though; the
impact is not gender neutral
-Title 9: redress past discrimination and promote more equal athletic opportunity for
women as a group; applies to educational programs and activities; they need to be
receiving federal funds; program specific (from Grove City) approach (so title 9 only
applies to the specific thing that gets money); Congress overruled this in the Civil Rights
Restoration Act and does an institutional approach (it applies if anyone gets money);
NCAA isn’t subject to title 9, but its member institutions are; *numbered things on page
130 plus money given (funding); look at program as a whole, not at the specific sport
-NCAA v. Smith: volleyballer who graduated early; went somewhere else for grad
school; rule says she cannot play sport since she went to a different school, even though
she still has 2 years of eligibility left; board will not grant the waiver; they granted more
waivers to males, but the court never got that far; schools get the funds, rather than the
NCAA; it is supposed to be broad; NCAA gets money from the school from dues
payments (is this enough? No); plaintiff says NCAA gets money in 2 other ways: they
cede controlling authority, so the other entity should be subject to Title 9 and that NCAA
gets federal money from NYSP (youth outreach program); court says if they can show
that NYSP does get federal money, she may have a case; mootness may soon become an
issue
-need state action for constitutional issues; not for NCAA, sometimes for universities,
always for high schools, yes for high school associations (if they are state); program is
subject to title 9 if and money is coming in*; 10 factors plus money in an overall look
-exemptions for title 9: doesn’t apply to religious institutions; private entities; beauty
pageants; not for profits; where selection is based on skill and it is a contact sport; okay
to field a same sex team, but what if you allow someone of the other sex to try out?
-Mercer v. Duke: football kicker who wanted to play; Duke didn’t let her play, saying it
was a contact sport; she was originally on it, but wasn’t allowed to practice and was
degraded; she left team and sued; Duke said it’s a contact sport; so women could be
excluded from a contact sport; regulations don’t address this situation because there is no
correlation for women; court says once you allow them to try out, you have to allow them
the opportunity to play on an equal basis; discrimination was when they let less-qualified
players stay on the team after they didn’t let her back on; punitive damages are not
allowed for title 9; so title 9 does apply to contact sports
-these regulations are not a slam dunk; president and congress can veto them
-3 prong test: 131; has to meet one of them; 1 is substantial proportionality with overall
population (wide disparity is a problem); 2 is a history of program expansion for the
under-represented sex; 3 is that the interests and abilities of the under-represented sex are
accommodated by the present program (making sure their needs and interests are met);
the 1st one is the safe harbor for schools; the other 2 are harder to show; there are some
places where the girls just don’t want to play sports; once the states get the funding, they
are not exempt*; schools want to exclude revenue producing sports
-Horner: plaintiffs suing under title 9 because they want fast pitch softball, so they can
get scholarships; whether they are subject to title 9; they didn’t get federal funding
directly but they got dues from schools who got federal funds; court says indirect funding
may be enough; plaintiffs need to show that 25% of schools in the district would play;
how do you determine the level of interest? They asked the administrations and not the
students, so that was a big problem for the schools; court wants more information to
determine it; whether title 9 requires intentional discrimination for damages: they need
intentional when a facially neutral policy is challenged; issue is whether there is a
disparate impact
-Cohen v. Brown: Brown cut women’s sports to cut budget, which they are free to do;
but that made it be not substantially proportionate; they looked at the 3 part test; school
didn’t pass the prongs; they stink on the first one; school says the women don’t want to
play and aren’t capable; court says it is an anti discrimination statute, not an affirmative
action statute (really, it is probably both and it maybe does require quotas); Brown wants
a relative interest standard (only have to meet relative interest) (trying to make prong 3
more accessible); court says no, you need to also accommodate women (and not just the
men); court rejects relative interest thing because they don’t want to get into whether
women are interested; if you cut women’s teams, you cannot say that you are
accommodating them (until those students leave); but Brown would be able to cut a
men’s team in order to comply (school can comply however they want to)
-remedies under title 9: funds can be terminated; implied cause of action against the
institution, but not the individual; there are money damages available under certain circ’s
(but congress can disapprove any termination of federal funding to a school due to title 9;
congress has never let it be terminated)
-ways to use title 9: use internal grievance process; file complaint with dept of education;
initiate compliance review from office of civil rights
-Miami: wrestling; to comply with title 9, Miami cut men’s wrestling to get to substantial
proportionality; Miami is public, so state action also applies; only if the policy
interpretations of title 9 are illegal can the plaintiffs win, and since they did not challenge
those things, they cannot win; policy interpretation is entitled to deference; title 9 focus
on under-represented gender (so it says it is affirmative action)
-Pederson: big football, so more money going into that than into women’s teams;
plaintiffs play softball and soccer; alleging violations of a lot of things; district court says
it violated title 9, but not intentionally (it is supposed to be a deterrent, so if it is not
intentional, there is nothing to deter); need intent in order to get money damages; need for
standing: suffered injury, causation, redressibility (if you win the case, will it do what
you need it to do) (different than mootness); only need to show you are able and ready to
try out for the team to get standing (not that you’d make the team); to have standing, you
need to have had varsity status at some point (this is bad because all of the factors say
that you have a team already); court doesn’t find it moot because they don’t trust what the
college did before (because they are not credible); LSU is definitely not incompliance
(there is a huge disparity), to which LSU says women are not interested (this answer will
not fly); LSU’s argument was that it is not intentional because they were just trying to
protect the women; since it is paternalism, it is definitely intentional; is ignorance
sufficient to get the school off the hook? No
-if plaintiff can show they are in violation of one prong, the burden shifts to the other side
to show they meet one prong
-Nat’l Wrestling Coaches: coaches seeking to challenge 3 part test and 1996
clarification; don’t challenge 1975 regulations or anything else under title 9*; they are not
challenging title 9; they say it violates administrative procedure act; standing: problem is
redressibility because plaintiffs still won’t get what they need even if 3 part test is taken
away (they want their wrestling program back) (court says schools are the ones that
choose whether to take away programs and even if court holds for plaintiffs, school still
might not put back wrestling program; they would have had standing if they would have
challenged title 9 itself; interest versus enrollment (they want to make policy
interpretation more liberal); in an ideal world, to cut costs, some programs will be cut;
adequate remedy under administrative procedure act precludes this suit
-College Sports Council: same plaintiffs; they are now saying that other interpretations
are bad, in that they violate constitution, title 9, and administrative procedure act; they
say they violate that they are meant to implement (by mandating gender conscious cutting
of men’s teams); they have concrete injury; they have causation; do not have
redressibility because schools are making independent choices (they have no proof that
school will re-implement wrestling program); cannot sue department just because they
are an interested party (they should just go back and sue the school); APA requires
agencies to receive comments from interested parties, but those parties do not have a
private cause of action (do not have constitutional standing)
-if they are within 5-7%, they are okay (this is a quota); 2/3 are okay under the 3rd prong;
if they do the email survey, they will be in compliance for the 3rd prong unless there is a
sport where there is an un-represented test, there is sufficient ability in the sport and there
is reasonable expectation of competition in sport in the region; school can see nonresponse of student as lack of interest; have to have a “high level of response” and has to
be done in a frequent basis; cannot use survey to eliminate teams; if there are those 3
factors, you must field a team in that sport; people say this survey should not be used
(doesn’t encourage them to participate, doesn’t make them look at it in multiple ways,
conflicts with encouraging women to do sports, not sent to applicants, bad methodology,
shifts burden to female students to ensure compliance, too easy of compliance)
-factors are consistent because they came up in previous cases; rebuttable presumption of
compliance if you can show you meet one of the things; 3 prong test, as bad as it is,
remains the law; policy clarifications have to be given deference
-title 9: look at program overall, look at 3 prong test; problem for plaintiff will be
standing (injury, causation, redressibility [get around this by attack title 9 directly or go
after the individual university goes nowhere because cutting sports is what must be
done due to monetary concerns]); money damages are available, but you must show
intent (ignorance can be intent)
-Anti-Trust: amateur sports- Sherman Act (break up monopolies and allow competition);
need interstate commerce; section 1 and 2- 1 prohibits unreasonable restraints of trade
(agreements among persons that destroy competition), and 2 is market power (so no
agreement is necessary)
-Board of Regents: per se (so clearly restraints of trade that anyone can see it) versus rule
of reason (everything else); “you’ll be punished if you don’t follow our rules”; some
teams want to be able to do better, so they go out and make their own deals; they says it
is a violation of the Sherman act; networks and viewers get artificially high prices; they
say they are doing it for a reason (uniformity, level the playing field, competitive balance,
and to protect the ticket revenues [no evidence for this]); sued under Anti-Trust law; is
there a reasonable substitute for college football?; they make the argument that if it is not
on TV, people will be likely to go see it; the NFL has something like this (the Blackout
Rule), but college has its fan-base built in, since it is right on campus and it is really hard
to get tickets for really good college football games (and it is not likely people would go
to the worse games, if the better ones aren’t on TV); viewers want popular games on TV;
district court says what the NCAA is doing is like a cartel; circuit court also does not buy
the NCAA’s justification (saying the viewer ship goes down, so it is not pro-competitive,
since you are reducing choice) (there are less restrictive means that can be used to bring
about parity); court says rule limits competition, so it is per se; even if it is not per se, its
limits price and output, so it is still bad; supreme court says this is a horizontal restraint of
trade; without this rule, you would have more competition; this ceiling on the number of
games they can televise is an unreasonable restraint on output; also, the contract floor is
also an unreasonable restriction, because it is price fixing; this is an agreement in which
some agreement is needed, so they use rule of reason analysis; most of the controls are
good because they are pro-competitive (because without this agreement, there would be
no sport); protecting the amateur nature of college sports; cannot just make it per se (you
have to look at the NCAA’s reasoning) (there is a strong presumption that it'll be okay);
in plain English, this would limit consumer choice of which games would be on TV; all
of the networks were closed out of this deal (so it was anti-competitive); NCAA member
schools had no choice but to comply (this is way different than what happened in
Tarkanian); absence of proof of market power does not mean that all of these anticompetitive restrictions are okay (and they probably did have market power); NCAA has
complete control over the marker, so NCAA has a very heavy burden to meet to show
that it is pro-competitive; no other NCAA sport had a similar plan
-dissent: NCAA is this altruistic entity trying to help mankind; there is a noneconomic nature to what the NCAA is doing
-Worldwide Basketball: they don’t want the kids playing too many game (that is what
the NCAA is playing); there is a limit to how many games and tournaments teams can
play in; the promoters are upset; there will be a quick look rule of reason (if an observer
can easily see an anti-competitive effect); court saw an anti-competitive effect, but the
circuit court did not find it because they did not define a relevant market (product market
and geographic market); reasonable interchangeability standard: are there substitutes that
perform the same function, and what consumer response is there to different prices?;
court says fungibility has nothing to do with it, it has to be cross-elasticity of demand,
and the plaintiff’s lawyer did not do a study on that; in certain cases, a submarket may be
okay for anti-trust purposes
-as a plaintiff, you want the market to be as small as possible, because it'll be
easier to show restraint on competition
-MIBA: NCAA wants tournaments to not be subject to Sherman Act (arguing that it is
non-commercial); court says no, it just means that you get benefit of the doubt if there is
a pro-competitive effect; rule of reason applies because it is in the context of the NCAA;
plaintiff has to show the adverse effect in the relevant market; market power can be
shown or presumed if the defendant has a large enough share of the relevant market
(which the NCAA has); NCAA wants a rule that says a team has to go to the NCAA
tourney if it is invited; plaintiff first has to show restraint on competition; NCAA has to
show pro-competitive effect; if they can, plaintiff has to show restraint is not necessary or
a less restrictive alternative exists; this is a horizontal restraint (because it is among
member schools in the way that they compete with each other); NIT says this is
restricting competition; NCAA doesn’t really have a response to this claim; court will not
grant summary judgment because they need more information
-Tanaka: she wants to transfer schools; she wouldn’t be able to play for 2 years; she says
they have market power in the LA soccer scene; problem is that the market is more
national; she lost because she couldn’t accurately define the relevant geographic market
-Banks: non-commercial regulation; since he already got an agent and entered the draft,
he couldn’t go back and play for the school; he waited to long until right up to when the
season was starting to have a chance to win the case; clock kept ticking so that the thing
wasn’t filed in a timely fashion; market is the amateur football labor market (so it sounds
like a commercial and labor market); these actions are pro-competitive; really, the rules
are about preserving the nature of amateur athletics; it is not as ideal or as pessimistic as
the sides want to claim it is
-Walk-Ons: players say it is a restriction on competition and were it not for limit on
scholarships, we would have scholarships; the other side says that it is non-commercial
-Law: if it will save NCAA money, it'll be commercial and it is not going to fly; this is
about restrictions on assistant coaches’ earnings; sounds like a restriction on commerce;
rule of reason under section 1 because it is amateur sports; they can easily show
restriction on competition; NCAA comes back and says they need it to achieve
competitive balance (court doesn’t buy that argument because there is no limit in
anything else they did)
-if it is non-commercial, it'll be okay; it'll be harder if it is commercial
-Adidas: commercial; they restricted the size of logos that could be worn; it is about a
commercial item, but the real issue is ensuring the integrity and making sure the school
name is dominant; Adidas wants to say that it is commercial and about making money;
they were willing to work with Adidas to try to help them, but Adidas blew them off (this
does not look good in court); court says it is not commercial because it doesn’t give the
NCAA any advantage in commercial transactions; they couldn’t show a direct economic
benefit for the NCAA
-PROFESSIONAL SPORTS: market value (there is a big thrill to owning a team); huge
growth in pro sports (this leads to lots of legal issues); when you buy a team, you buy
into the product of the league; league provides the name, the trademarks, goodwill,
standard procedures of operation, nation and international marketing, merchandising;
there are certain standards that must be met (the trademark means something because the
product is consistent) so that consumers will be happy; the deal changes constantly;
parity makes the leagues more successful; if some team goes belly up and sponsors are
stiffed, the league still has to make good; so the franchises are very dependent upon each
other (so they are careful when letting in new owners); prejudice against large companies
(not as much now); you can own player K’s and present the game; you also get the home
territory and local sponsorships; you get to share in the profits of the goodwill of the
league; you benefit from economies of scale; league shows you how to comply with
things; there is arbitration for settling disputes; all of these things are subject to
restrictions
-Oakland Raiders: sues the NFL; he says league breached its fiduciary duty to the
Raiders by treating them differently than other clubs; is there a fiduciary duty? The
person should have to know that they have the duty, because it is a huge duty; court does
not find a fiduciary relationship and says they won’t interfere; appellate court says no
fiduciary duty; the commissioner’s actions will always be detrimental to certain clubs
-Piazza: group of investors want to buy Giants and move them to Tampa; this was not
popular with the owners because it doesn’t look good for the league for teams to move;
the rest of the owners would not approve the sale, and they sold to a different group for a
lower amount; one of the guys on behalf of MLB said one of the potential owners was in
the mob; they say MLB has a monopoly on teams and who gets to buy those teams (MLB
requires consent to change of control of teams; they say that this is against Sherman Act);
MLB says this doesn’t affect competition because they want to join us, not compete with
us (and we are exempt); it is an inter-league market, and they are competing with other
prospective purchasers; baseball says it is exempt by the reserve clause (at club’s option,
K could be renewed for one year [owners’ thought this was perpetual]); in 1922, OW
Holmes says baseball is exempt because it is not interstate commerce; revisited in
Tollson they do not reverse Holmes (this let baseball do the minor leagues, which
would be taken away if the reserve clause were overturned); what does the scope of the
exemption apply to? Only the reserve clause, or everything; baseball wants it to apply to
everything, but the court reads it narrowly (says it applies only to the business of
baseball) (market for baseball games or the market for baseball teams?; it only applies to
the purchase of teams; so the exemption is not broad); baseball’s motion to dismiss the
anti-trust claim is denied
-Curt Flood Act removes baseball’s labor exemption (?); variety of things Commissioner
is responsible for: labor negotiator, owner’s representative, punisher, face of the league,
enacting rules (new ball, shootout in hockey), builds consensus (since owners have
diverse interests) (make it a stronger unit) (will be seen as being unfair to certain teams
sometimes); enacts, promulgates, and enforces rules; there is a due process requirement
for the rules (because they cannot be arbitrary or capricious, as a private entity); try to
protect the image (public relations) (protect the integrity of the game); executive and
business aspect to the role of the commissioner (also judicial aspect); have to follow the
CBA’s as negotiated by the unions; bylaws and constitutions are the source of the
commissioner’s authority; past practice and the intent of the owners are taken into
account; some commissioners are more powerful than others; “in the best interests of the
game” (protect the nature and integrity of the game); national commission panel of 3
owners set the rules for the league in 1919 (black sox) (commissioner ruled on the
situation for the first time) (Judge Kennesaw Mountain Landis-dominant individual for
the role of the commissioner; gave him ultimate power; banned 13 men in 24 years); no
longer say that they will not sue the commissioner; change the wording to “not in the best
interests of the game”
-Finley v. Kuhn: onset of free agency; so owners try to sell his best players to the Red
Sox; plaintiffs said the commissioner went outside of his authority to disallow the trades;
court said he could do it because he had broad authority when ruling about the best
interests of the game; court says the waiver of recourse clause doesn’t matter; it only
matters if it is arbitrary/capricious or failure to follow their own rules
-Atlanta v. Kuhn: Ted Turner wanted rookie of the year; commissioner fines guy and
takes away his draft picks; don’t let him takes away draft picks because it would act as a
penalty (even though it is really probably deterrence)
-Owner’s conduct toward a player: owners probably have an interest in how other
owners treat the players; they want these issues taken care of very quickly so fans won’t
get upset; if owners don’t like what the owner is doing, they can kick him out
-each league has an involuntary termination clause, but it requires a supermajority vote (because it is very serious); ownership of the team reverts to the league (the
downside is that there is no good pr and it is not going to have a lot of value) (also, the
league assumes liabilities; and the other owners may have a conflict of interest when they
own the team collectively); waiver of recourse clauses are not effective (can be beefed up
with penalties; like, pay a fine unless you win on the merits)
-Pete Rose scandal: 1989- rumors that he bets on baseball; does the Dowd Report; Rose
gets banned for life and tried to wiggle out of it; he did not admit at the time; he is not
able to get into the Hall of Fame; Rose tried to prevent the hearing from happening
because he said Giamatti couldn’t be neutral; they said no, and he got a lifetime ban
-1994: reworked office of the commissioner; best interests clause is only for public
confidence and integrity, and owners get to do the things that have to do with business
(takes responsibility away from the commissioner)
-discipline and penalties: CBA are the sources of rules; there will be due process
requirements and procedures; standard player contract also sets rules on discipline;
limited moral clause (problem is in enforcement and being consistent [if not consistent, it
will be arbitrary/capricious]); leagues and union keep close tabs of player special
covenants because they don’t want them to be against the rules; Const. and By-laws give
power to the league; CBA is the ultimate authority, because that is what was bargained
for; can challenge for procedural flaws, that they are ultra vires (there is deference to
arbitration awards)
-there are penalties for on-field conduct; violation for K and club rules; drug
problems
-commissioner has authority (as league) and so do clubs; there is some due
process (counsel may be limited to union counsel, not for the individual player); can
terminate the K if the player cannot perform the terms of it; commissioner is final
authority for on-field conduct; integrity issues go to neutral arbitrators
-Ricky Williams: smokes weed, gets in trouble, goes to the mountains; runs out of
money, so he comes back to play football; has to play for Dolphins; is only a K issue (not
about the weed); he already accepted the money, and he did not earn it yet (like the
signing bonus); he is in breach of the K; Williams’ argument is that Florida law does not
allow penalty provisions (even though he did breach his K); court says no, you have to
look to the provisions of the standard player K and it is not an absurd penalty at all (court
said arbitrator’s decision was okay)
-Pacers case: big fight at b-ball game; Stern has to be swift and tough; appropriate steps
must be taken re: security (limit alcohol serving, enforce seating, improve security
overall); arena may have some liability; ban certain fans; union went to bat strongly on
behalf of the players; NBA says grievance arbitrator does not have jurisdiction (3 aspects:
arbitrability- parties meant to arbitrate this? Or is it commissioner’s authority;
substantive or procedural arbitrability? Arbitrator can rule on procedural; is it conduct on
the playing court? Commissioner only had on court jurisdiction) (court said parties said
this should go to neutral arbitrator; court said it is procedural; court said it was off the
court conduct) (NBA said it should be on court because it was at the event) (union wants
to restrict it to conduct on the playing court) (arbitrator wants to follow the intent of the
parties) (he says arbitrator has jurisdiction when the players go after fans, and
commissioner only has jurisdiction if it has to do with what happens at the game)
-Back to Anti-trust: membership transfer: transfer of ownership interest in a franchise;
franchise relocation: involve a franchise move (can be a part of a membership transfer);
Sherman Act: 1- restrain trade, 2-against monopoly (does not require an agreement)
-Baseball has an exemption- Holmes focused on interstate commerce aspect
-Toolson v Yankees: it is clearly interstate commerce, but Congress never changed it
from what it was before; court said it is up to Congress, not the courts, to do any changes
(this is crap though)
-Flood: baseball is def. interstate commerce; reserve system is an exception that is
confined to baseball (so the other sports don’t get the exemption); other sports are not so
exempt; pass the buck to congress
-Piazza: limit the exemption as much as possible to the business of baseball (but it never
really defined “business of baseball”); reserve system let the minor league system
develop; exemption applies only to the reserve clause, or business of baseball
-NO Pelicans: try to move a minor league team to NO; rule is that minor league team has
to move out if major league team comes into a city; there was already an agreement and a
letter of intent; Denver wants and gets the territory (even though they didn’t meet the
requirements); so baseball does whatever it wants to achieve what it wants; plaintiffs say
baseball is restricting competition; court rejects piazza decision; says baseball can do
whatever it wants in the market of teams in cities
-Morsanti: plaintiffs bought an interest in the Twins; majority interest got transferred to
another group; baseball wanted the minority group to sell, in exchange to first dibs on the
next expansion team; baseball suckered them; baseball does not give them a chance to
buy in; they go to court but the statute of limitations has run; does it prohibit cause of
action?; it is well beyond the 4 year statute of limitations; equitable estoppel is a shield,
not a sword (it doesn’t start the clock, but it doesn’t let the other side do shady things);
there really was collusion and anti-trust action going on
-NO Pelicans: relocation to NO; something went wrong with the language; higher
classification club gets to bump a lower team out; to win, plaintiff has to allege he can get
relief and the other side acted arbitrarily and capriciously
-Piazza: investors try to buy into the team; defendants say there is no standing and no
restriction in competition in the product market; def. says they are not seeking to compete
with us, they want to join us; court says no, they want to buy into an existing club, rather
than get a new team (and there is a finite number of teams) (so it'll be easy to show
restriction on competition) (market is existing ML baseball teams); standing: causal
connection between anti-trust violation and the harm, must be an injury of the type it was
meant to address (injury must be direct) (are there better plaintiffs?) (Is there duplicative
recovery or complex damages?); MLB says it belongs to the partnership and that it
should be personal injury, not anti-trust; court says malice can lead to disapproval; they
are not able to purposefully cause a breach; where there is a qualified privilege to
interfere in business, that privilege carries an obligation to use means that are not
improper (so they cannot be arbitrary/capricious)
-NBA v Minn.: they rejected them because they wouldn’t disclose their funding; NBA’s
big problem is scheduling; NBA wants the right to reject ownership transfers and
relocations of the team; district court gives NBA a TRO; Top Rank goes to NO, and sues
the NBA; TRO against the NBA; Minny court finds for NBA and enjoins state court
proceedings and takes away TRO; state court tells federal district court to kiss its ass;
district court again enjoins state court; 3: congress has authorized it, it is necessary for
jurisdiction, necessary for federal court judgment (relitigation exemption); whoever gets
to the courthouse first wins
-LA Memorial Coliseum Commission: LA coliseum doesn’t have a team because teams
are moving; move into another home territory has to be by unanimous vote; is this unfair
restriction to movement?; so they change the rule to ¾ of owners; unanimous rule
violated section 1; section 1 applies, but it is not a single entity (***); apply rule of
reason; it is an agreement to control competition, but is there injury?; they cannot act as a
cartel; the geographic market is the economic area; NFL wants the market to be broad,
and the Raiders want it to be narrow; bad things are allowed if they are needed for a
bigger good thing; is there harm? Teams cannot move and stadiums cannot get teams;
LA is big enough for 2 teams; they want to make sure it is not arbitrary and capricious, so
they put in factors; difference in the value between area where the team moves from to
where it moves to belongs to the league; so there is a transfer fee; so there is a
disincentive to moving; eminent domain is a restriction on state commerce; the holding is
limited to this case
Raiders I: only where one club tries to transfer into another club’s territory without the
other club’s permission
-Why let another team into your territory? They will pay you for it!
-NBA v. SDC: Clippers wanna move to LA; the Lakers let them; NBA sues; Clippers
announce they are moving to LA due to severe financial restraints (one of the allowable
things from Raiders I. Unanimous approval was needed for a team to move into the area
of another team (but this was not in writing), which is a high hurdle to overcome; file
declatory action to sanction the Clippers; court says the holding in the Raiders case is
very narrow, and neither Raiders I nor II set an absolute rule for sports leagues; will
apply rule of reason; court said all Raiders said was that conditions might be sufficient
(not that they are necessary); what is the purpose of the restraint?; what is the market?;
court finds an implicit right because it is past league practice (court wants to find for the
NBA); did the NBA forbid them from moving? No, they just sued after the fact; so no
summary judgment; settled (Clippers got to move in exchange for fee and voting that
league would have to approve moves); now, no leagues require unanimous approval
-St. Louis Convention: StL wanted an NFL team and build a stadium in anticipation (bad
idea to do this); NFL approves the deal; they default on a payment; it’s a really sweet-hart
deal for the Rams; 29M dollar relocation fee (to reimburse the TV networks); it is the
league’s job to look at the whole deal to make sure that it makes sense; NFL should have
known the deal won’t work because StL cannot make the payment; they end up playing
in StL and cut another deal (CVC sues the league and let the Rams get half the winnings)
(suit says the league deters bidding and relocation) (they also due tortuous interference);
NFL says it is one economic enterprise and therefore incapable of conspiracy***
meaning no section 1 claim; this defense is denied; apply the rule of reason; CVC has to
prove the conspiracy caused lack of bids on the TransWorld Dome (hard to show this);
on section 2 motion, CVC has to show NFL used monopoly to get an advantage in the
realm of stadiums; there is probably anti-trust violation here, but is it justifiable? The
problem is no one can really prove it (there is no record and it is basically intuitive); NFL
moves for summary judgment and the court says that the NFL said to StL: “if you
negotiate with anyone else, we will not deal with you”; cannot find evidence to show why
people were not bidding
-goes up to the 8th Circuit- nothing in the rules that prohibits competition among
teams for leases and the plaintiffs did not carry their burden of proving the case; so no
liability; for the tortuous interference, the league did not even know they were paying it
on behalf of the team, so no tortuous interference
-PKK Corp. v. NFL: Cayenne comes into ownership of the Pats; Cayenne said he’d
comply with rules and not move the team unless the league granted him permission to; he
meets Touchdown Jacksonville, who says we will do what you tell us to do (so it is
market power); NFL tells Touchdown Jacksonville to go away; TJI becomes TJL and
gets the Jags; any franchise is worth more if it is mobile; all sides should sign a release
releasing the league from liability; why would the NFL make him do a lower price (if that
forces all of the other teams’ value to take a hit)? (as a practical matter, this makes no
sense); plaintiff say it was done on duress and there was no consideration; defendants win
on all in the lower courts; higher court says he waited too long to file a claim; NFL made
a mistake because the claim survives for TJI
-was there a conspiracy here?
-Expansion: there needs to be a viable market; are there decent TV markets; will it dilute
talent; will it hurt labor peace; any anti-trust threats; was is the expansion fee going to
be?; look at facilities, the new owner (don’t want people to make waves) (want someone
experienced), is it a good market?; they want it to be a private entity and a local owner;
how will they pay for the fee?; don’t want a lot of debt; what type of payment terms?;
don’t want owners paying things out of their own pockets; the factors for expansion are
like the ones for relocation
-Contraction put pressure on labor; leagues can contract, but have to be very careful,
because it will devalue all of the other teams and because it is an invitation to anti-trust
issues
-MLB v. Butterworth: they claim business of baseball is exempt from federal anti-trust
law; court says they are exempt because the number of teams is at the root of federal
baseball (is this true though?); tries to use Piazza but this does not work
-Rival Leagues: section 2 claims about the misuse of monopoly power
-AFL v. NFL: sue for monopoly, attempt at monopoly, conspiracy to monopolize (for
players, TV); to prove: def. had monopoly power and they could control prices or
exclude competition (did NFL have sufficient power to prevent the AFL from forming or
succeeding?); merely keeping it out of certain cities is not a violation unless keeping it
out of markets would have meant the league would not work; also has to show that
plaintiff intended and took action to do this; don’t have to show monopoly power for
attempt or conspiracy, but do have to show specific intent; don’t have to succeed as
monopolist to be guilty
-relevant market it national; plaintiff was not successful in showing monopoly
power because they could get players and TV and attendance (because it is limited to the
cities that actually are able to support a team) (there are enough cities that could support a
team); no liability on the straight monopoly claim
-for attempt to conspire: it is okay to compete, said the court, just not to do
anything unethical (NFL was just competing); was there an injury due the NFL’s actions?
No, since they merged (so the franchises had to be good)
-for monopoly power: show monopoly power and something done that excludes
the other from competition
-court starts with specific intent, then goes to lesser “predominant intent” when
talking about the facts of the case
-AFL v. NFL (366): whether NFL was expanding solely to stop AFL from going into the
markets; court says it is not sufficient because there were other cities AFL could’ve gone
into; natural monopoly is not violation unless it is misused to gain an advantage
competitively for teams in other cities or the league as a whole
-USFL v. NFL: claiming it cannot get TV contracts, cannot get facilities, disparaging the
game, and cannot get access to good game officials; allege monopoly, attempt, and
conspiracy; use prior history, and history of NFL in courts (18 prior lawsuits; court says
this doesn’t matter), and Raiders cases; stadium claims
-Noerr Pennington doctrine: NFL’s ability to go to lease meetings and protest is
protected by the 1st amendment and are not against the antitrust laws even if that was
their intent (1st amendment has priority)
-disparaging statements: it is not a violation if it is not false
-game officials: there are always plenty of officials available since it is a national
market; and they cannot show that not finding refs led to them not being able to play
-they couldn’t establish that they were abusing (natural) monopoly power
-Labor relations: federal labor policy objectives are the let the parties freely contract for
good provisions; collective bargaining- 2 sides bargain for terms (individuals can
negotiate within certain parameters); each side elects a representative; right to selforganize, collectively bargain, do concertive activities; mutual obligation to bargain for
mandatory subjects (wages, drug system, hours, rules); NLRB will do enforcement of
this; should each of the positions be divided; there are mandatory, permissive, and illegal
subjects of bargaining; multi-employer bargaining is sport-wide in sports (not industry
wide) (so it is within the league); can do economic pressure; can do renegotiations; CBA
governs in disputes
-federal anti-trust policy-Sherman act says you cannot restrict competition (so the
CBA is a conflict for this)
-statutory labor exemption: antitrust laws do not apply to some legitimate anticompetitive labor activities because of federal labor policy promoting collective
bargaining (strike and boycott) but it only applies to unions!!!
Non-statutory labor exemption: not in the statute; in case law; if a restraint affect
primarily only parties of the CBA, is about a mandatory subject of bargaining, and is the
product of bonifide arm’s length bargaining, then the non-statutory labor exemptions
apply and the labor laws do not apply; non-statutory is used by management against the
union; how long does it apply after CBA expires?
-Robertson v. NBA: test is the practices at issue were in the union’s own interest; no
exemption protecting the league
-Smith v. Pro Football: he got hurt, and is challenging the draft, saying he couldn’t get a
fair K to start with and couldn’t negotiate with others; says draft is a group boycott;
statutory does not apply; non-statutory: need all three factors; the more restrictions you
have, the harder it will be to justify any one
-Mackey: about the Rozelle rule; not many players signed with other teams, and when
they did, the teams agreed with themselves; non-statutory labor exemption applies (it is a
mandatory subject, it only affects the subjects, but it is not bonifide arm’s length
bargaining because it was unilaterally imposed); so anti-trust law does apply, since they
could not meet the 3rd factor
-does it violate section 1? Rule of reason will apply; need legitimate business
purpose and not more restrictive than necessary; there is a good business purpose; court
does not find it justified because it is too broad of a restriction (there is not way around it
and it has universal application; no procedural safeguards; not limited in time)
-Clarett: Ohio State football player was getting money from boosters so his eligibility
was in question; NFL had a rule that said he couldn’t go to the draft because high school
class was not graduated for 3 years; he is one season shy of eligibility; NFL wants to
keep its minor league system going; fell under the non-statutory exemption, because it'll
fundamentally alter; he wasn’t part of the union, but that is okay and it still applies; this
wasn’t the type of case it was designed to protect; Clarett has to go to labor law and not
anti-trust law
------non-statutory exemption is a balancing test between labor and anti-trust; bottom line
is “does one have priority?”; non-statutory applies if it affects 2 parties, mandatory
subject of bargaining, and done at arm’s length; what if the CBA expires? At what point
does the nse apply? If the nse expires, then it becomes subject to anti-trust law, so the
owners would def have to come to an agreement (the union would have a lot of power); it
does NOT expire with the cba
-Powell v NFL: player strike is not going very far; does the nse expire when cba
expires?; trial court says it expires once there is an impasse; just because a party takes the
position as a strategy does not mean it is illegal; after impasse, the employer can make
unilateral changes which are reasonably comprehended in pre-impasse proposals; as long
as it is unchanged and as long as they think it’ll be part of the new cba; cannot treat
impasse as misconduct by the defendants, and this situation would do that; giving the
union too much power would upset the balance; so labor law takes priority; free agency is
mandatory, it was arm’s length, so the exemption applies after impasse; 2 big problems:
does not mean management is forever exempt from anti-trust clause (so free agency can
be a problem), and they won’t say when the exemption expires; *exemption goes on as
long as there is a labor relationship; nflpa decided to decertify, so the players were able to
sue individually (because the union would not have been able to win otherwise), so it
goes back to anti-trust law
-Brown v. Pro Football: they wanna set the practice squad players at a set level
unilaterally; it was not collectively bargained and there were some discussions about this;
this was not something that was reasonably to be believed would come up in the next
bargaining session; impasse is the wrong point to draw this line; court says pro sports are
special because they act like a single employer and that football players are just like other
workers, so they must play by the same rules; so this is broader than Powell (it doesn’t
have to be anything that they agree with the union on); but the league cannot do anything
(it has to be within the proposal and cannot be too distant in time from the collective
bargaining discussions); dissent says this is a radical change in how people are paid and it
goes too far; employers have to be worried about possible section 1 violations (balance of
power in favor of the union)
-NHL v. NHLPA: is the league liable for anti-trust damages?; player strike is about to
happen; unilateral change doctrine- once you bargain to impasse, the employer can make
unilateral changes if they have talked about them; declatory judgment act: plaintiff has to
show court has basis for subject matter jurisdiction, and there has to be a controversy
between the parties; in this case, there was no controversy between the parties; to bring
an anti-trust suit: causal connection between violation and injury, nature of the alleged
injury, non-speculative damages; cannot have duplicative recovery, have to be one of the
best plaintiffs to bring the suit; problem is that the suit should be brought by the players
and not the union, so there was no controversy yet; so the employers cannot know in
advance if it will be liable for anti-trust damages; how do you know if it is mandatory
term of employment?
-Silverman: free agency and the reserve system; it is the same issue that caused the
season to end, so it will not be anticipated by the union (Powell), but Brown says that that
might not matter; draft, free agency, and the reserve clause all make it hard for players to
move around in the league; league says clubs cannot sign players (the player relations
committee will now do it); so the players will not be able to benefit from competitive
bidding any more; NLRB says they do not need to find an unfair labor practice occurred,
just that one could’ve occurred, and the court went along with this; league says it is a
permissive subject, so they do not have to bargain for it at all (this does not work)
-should free agency be mandatory subject? (wages, hours, safety, etc); this is all part of
the relationship between the parties, so it is mandatory
-Baseball: exempt from anti-trust laws; piazza said it is limited to reserve system of
business of baseball (so district court cases say it is not a blanket exemption)
-Curt Flood Act: it is for labor purposes only; the drafting of it was done by baseball
league owners; why would they want to do this? To control the scope
-McCoy: court says Congress has not eliminated the exemption yet, so they will grant
baseball’s motion to dismiss; also, they do not have standing, because there is no causal
connection, and the injuries are not of the type that the laws were meant to address*
-Whalers: Van Ryn Rule; why does the NHL care about this? NHL wants to preserve its
farm system; he is drafted by the Devils, so the NHL wants to let the Devils keep his
rights; after his year with the OHL, he becomes a free agent, so this undermines the
whole draft system; rule is no overage player can be signed by an OHL team unless he
has not been in the NCAA the previous year; lower court did per se, which was wrong;
there may be a conspiracy; relevant market is 16-20 year old hockey players in the US;
court says since they do not get a salary, the issue is not economic; there is a relevant
market for players going from the OHL to the NHL, but there are lots of restrictions for
all of these players (and that is okay because it is under the nse) (so it doesn’t matter that
the kids were not part of the union when the rule limiting them was implemented); *for
the junior league, since they didn’t earn salary, the only impact was on the competition
between the teams (the econ. Impact that could be shown was on the drafted players
going to the NHL who couldn’t get free agency, court said who cares (since there are lots
of these rules)
-Agent: agents should know certain things that will help their client get a good deal;
agent has an ongoing and long-term relationship with a lot of clubs that can work for or
against the player; there is a representation agreement; there may be some unethical
solicitation; excessive fees and conflict of interest; there can be a financial services
agreement; agent wants to have the athlete sign as many K’s as services the agent will
provide; you want everything clear in the K; there are some standard clauses; there are
background checks for fraud that they make sure the agents are up to speed; there is also
a standard representation form; compensation can be standardized (agents cannot get paid
by the club); prohibit bribery and make them stay in contact with the union; schools have
a cause of action for civil damages if they are harmed; agents have to comply with all of
the state laws when they have a client in that state
-White case: attempt to go around the salary cap; agents say they are immune because
they did not sign the cba; so they now make it be filed with the agents, or else the agents
cannot get paid; agents didn’t consent to this, but the court said that consent can be
implied, and it was in this case
-Collins: beginning of the agent certification system; Kareem is having a problem here;
agent is certified in 1986 (the cert. process was not real strict); union decertifies him and
he reapplies; this guy was screwing Kareem over; his re-application is denied and he files
suit, saying it is a group boycott and against the anti-trust laws (agents make their living
on this and he had been doing this for years); court says union can implement this rule
and does not have to grandfather him in
-there is a code of ethics for attorneys; cannot be in partnership and share proceeds with a
non-lawyer; excessive fees and conflicts of interest are a problem; get malpractice
insurance
-Pickens: conflict because he signed with 2 or more agents; first agent gave him a car;
how do you determine what the jilted agent should get?; look at what he promised to do;
what he promised minus what he saved; can he recover commission on a K someone else
negotiated? No
-Common law duties: fiduciary relationship duties- loyalty, obedience, care; breach of K,
failure to perform, negligence, restitution, recission, constructive fraud* are the remedies
-Argovitz: he is agent and part-owner; wants to sign a player; player lost bargaining
power; USFL is also not an established team, so he should’ve told his player about it; you
need to tell the client about the conflict of interest; tell client about alternative courses of
action he or she has; so the K with the Gamblers is voided
-Brown v Wolf: charged with breach of fiduciary duty; his client signed with the Racers,
who went down the tube financially; the issue is constructive fraud (use position of
superior knowledge to put someone else in a bad spot)
-Speakers of Sport: promised the client lucrative endorsements; K with Speakers of
Sport was terminable at will (freedom of K), so he ended his K with them and went to
another agency; Speakers sues and says ProServe interfered; it is okay to do puffing, but
a pattern of unfulfilled promises is bad
-Woy and Horner: baseball collusion; the agent wanted more because he said he
would’ve gotten more if there was no collusion; so Horner wants some of Woy’s
collusion award; Horner was not the agent in the collusion hearings, but he still gets some
more money, to satisfy his efforts in the past and because he was a main witness in the
collusion hearings, so he should be compensated for that; (he should sue the league,
clubs, and commissioner)
-The Final: look at old exams!!! (library and web portal); open book; each question will
give you a role; bullets are fine, but make them complete and coherent; Anti-Trust: is it
interstate commerce, is there standing; look at the syllabus; look at the question and read
all 3 first; if you need more info, make an assumption and go on
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