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Cash Payments to Athletes? No. Ban on Cash Payments? No.

By Jonathan R. Tung, Esq. on October 01, 2015 3:58 PM

The NCAA lost some and won some in the wake of the Ninth Circuit decision. The court ruled 2-1 that the National Collegiate Athletic Association was not required to pay athletes royalties for the use of their names and likenesses. 

On the other hand, the court also found that a complete ban on royalties to athletes for use of their likeness in video games and telecasts violates anti-trust laws. Confused?

The District Court Ruling

The Circuit decision comes in the wake of Judge Claudia Wilken's August 2014 ruling that required the NCAA to pay athletes for their performances. The recent ruling by the Ninth Circuit does not equal to giving the NCAA free reign.

"What this court made clear is that the NCAA cannot exercise total economic dominion over the athletes," said lawyer Michael Hausfield, who represented several college athlete plaintiffs.

Nods of Approval; Grumblings

Unsurprisingly, NCAA President Mark Emmert agreed with the court's rejection of cash payout to athletes. He even conceded that the NCAA's recent changes allow the colleges to increase athletic scholarships to cover the students' costs of attendance. His major contention is that it should not be mandated by the courts. At this stage, the case remains appealable to the U.S. Supreme Court on the issue of cash compensation.

Professionals Versus Amateurs

When the case was originally brought in Judge Wilken's Oakland courtroom, she rejected the NCAA's argument that a cash compensation ban was necessary in order to promote competition, protect amateurism, and to maintain the public support. Wilkens remained unconvinced, however, and noted that the NCAA changed its standards of amateurism and had made billions of dollars in contracts in the process.

But in an added twist, the court further noted that a set aside amount of $5,000 per student would essentially eradicate any distinction between them and professional players. Student athletes who are not paid is the hallmark of "what makes them amateurs," opined Judge Jay Bybee. Ultimately, it appeared that the court was divided on the effects cash payments would have on amateur competition and public support. The debate is likely to continue. If you're scratching you're head, you're not alone.

It is difficult to determine what effect the court's ruling on these multiple issues will have on practicing attorneys and lawyers will do well to keep an eye on further developments on this case.

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