US: Judge nixes NCAA’s Amex argument

According to a report by Bloomberg, a federal court in California has decided that the NCAA can’t argue that college sports are a “multi-sided platform” (serving spectators and athletes) in fighting allegations that it fixed prices for athletes by capping student aid.

The case, which started trial on September 4t, seeks to change the NCAA’s rules and force grant in aid awards to cover more than just the costs of attending a university, reflecting the revenue schools gain from basketball and football programs. At the time the parties settled the athletes’ damages claims for US$208.6 million with court approval in December 2017.

This week, Judge Claudia Wilken, of the US District Court for the Northern District of California, rejected the NCAA’s argument that a recent Supreme Court opinion should override two of her earlier decisions in the case: 1) that the college sports market included only players; and 2) barring testimony from the NCAA’s economic expert.

The NCAA was one of the first litigants to cite the Supreme Court’s June opinion allowing American Express to stop merchants from asking consumers to use credit cards with cheaper swipe fees. The NCAA’s motion, made in late August, was an initial test to see how broadly the AmEx decision can be applied.

The Ohio v. American Express decision stated that all sides of a “multi-sided platform”—for AmEx, cardholders, and merchants—should be considered in assessing antitrust harm. The NCAA used that decision to argue that the college sports market doesn’t just involve athletes, but also spectators of the game. Both groups should be taken into account when determining whether there is harm, and the former players failed to do that, the NCAA argued.

The Supreme Court analysis “has no effect” on this case, Wilken responded, a day before the trial started. Before the high court ruling, she had said the NCAA’s caps on player scholarships cause significant anticompetitive effects in the student-athlete market, warping what would otherwise be a bidding process for exceptional talent.

https://biglawbusiness.com/ncaa-judge-nixes-amex-argument-for-capping-athletes-grants-corrected/

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