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Ivy League Wins Antitrust Case Over Athletic Scholarship Policy

By  |  April 2, 2026

A federal appeals court has affirmed the Ivy League’s long-standing policy of prohibiting athletic scholarships, rejecting claims from student-athletes that the rule unlawfully restricts financial aid and increases the cost of attending the prestigious universities.

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    In a decision issued Thursday, the US Court of Appeals for the Second Circuit ruled that the plaintiffs failed to meet a fundamental requirement in antitrust litigation by not adequately defining a relevant market, according to Bloomberg. The unsigned opinion emphasized that without a clearly established market, the court could not assess whether the Ivy League institutions wielded the kind of market power necessary to violate competition laws.

    “The alleged Ivy-only markets do not ‘encompass all interchangeable substitute products,’” the court stated. “Moreover, the alleged Ivy-plus markets for sale of educational services to and purchase of athletic services from AAHA students are insufficiently defined, as the complaint does not ‘include a plausible explanation as to why [these markets] should be limited to exclude possible substitutes.’”

    The ruling effectively ends a lawsuit filed in 2023 by a group of student-athletes who argued that the Ivy League’s agreement among its eight member schools not to offer athletic scholarships violated federal antitrust law. Instead of athletic-based aid, the Ivy League institutions provide financial assistance based on demonstrated economic need.

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    The case highlights the challenges plaintiffs face in antitrust disputes, particularly the need to define a relevant market that includes all reasonable alternatives available to consumers, per Bloomberg. Courts rely on this framework to evaluate alleged harm and determine whether competition has been unlawfully restricted.

    Read more: House Judiciary Committee Issues Subpoena to Brown University in Ivy League Price-Fixing Probe

    A three-judge panel consisting of Beth Robinson, Dennis Jacobs, and Richard C. Wesley heard the appeal. The judges appeared skeptical during oral arguments earlier this year, questioning whether other academically selective universities that do offer athletic scholarships could serve as viable alternatives for prospective student-athletes.

    The lawsuit was led by Tamenang Choh, who alleged that the Ivy League schools violated Section 1 of the Sherman Act by collectively refusing to award athletic scholarships to Division I athletes. However, a federal district court dismissed the case in 2024, finding that the plaintiffs had not properly defined the market in which the alleged harm occurred, according to Bloomberg.

    On appeal, the Second Circuit agreed with that conclusion, reinforcing the importance of market definition as a threshold issue in antitrust claims. Without it, the court said, it is impossible to determine whether defendants have sufficient influence to suppress competition.

    The decision closes the case, leaving intact the Ivy League’s distinctive approach to financial aid, which prioritizes need-based support over athletic incentives.

    Source: Bloomberg