The NCAA licenses student-athlete's images to video game makers.
Basketball star Ed O’Bannon and quarterback Sam Keller each earned most valuable player awards during their collegiate careers. Now, years after playing their final games, they are pursuing what they consider a more significant collegiate legacy: They are attempting through federal lawsuits to force the NCAA to share its annual revenues with student athletes—including money earned through the sale of video games bearing the athletes’ likenesses.
“There are millions and millions of dollars being made off the sweat and grind of the student athlete,” O’Bannon said. “Student athletes see none of that other than their education.”
O’Bannon’s lawsuit seeks a share of the money the NCAA earns from licensing former players’ images in commercials, DVDs, and through video game sales. Keller’s claims are narrower and focused on the NCAA’s deal with Electronic Arts Inc., which makes basketball and football video games based on college players’ images.
They are making headway in court, racking up preliminary victories that have advanced their cause further than previous legal challenges to the NCAA.
The debate over compensating student athletes is almost as old as the NCAA, founded in 1906. Amateurs have long-been expected to compete for free and the love of sport—or at least the cost of a scholarship.
But the NCAA’s revenues have skyrocketed in recent years—it recently signed a $10.8 billion, 14-year television deal for basketball—and so have the demands of athletes to share in the money.
For its part, the NCAA is steadfast in its position that student athletes are prohibited from receiving payment for participating in sports. It also says it has done nothing wrong in marketing itself for the benefit of its member schools and will continue to vigorously contest the lawsuits.
A judge earlier this year refused the NCAA’s request to toss out the eight lawsuits filed across the country by former student athletes. They are now consolidated into a single federal action in San Francisco.
The former student athletes accuse the NCAA of antitrust violations, alleging they are prevented from marketing their images because the NCAA locked up their commercial rights forever during their college days.
O’Bannon alleges that an NCAA monopoly is enforced with one particular form it requires every student athlete to sign before he or she can play. He says the form grants the NCAA exclusive commercial rights forever—including rights to use the athletes’ images in video game sales and for other marketing purposes.
The NCAA says the form merely give it permission to “promote NCAA events, activities, or programs.”
In a court filing, the NCAA said the form has little to do with commercial rights.
“It says nothing about the use of student-athlete images by member institutions, nothing about video game [sales], and absolutely nothing about the right of a former student athlete to sell his own collegiate image after graduation,” the court filing stated.
U.S. District Court Judge Claudia Wilken said the lawsuits, at first glance, appeared to show the NCAA’s “conduct constitutes an unreasonable restraint of trade.”
Legal analysts said that ruling will compel the NCAA to turn over many of its business secrets to the players’ lawyers. No previous lawsuit has advanced to this stage, said Vermont Law School professor Michael McCann, who specializes in sports law. He said even if the players ultimately lose their cases, the documents could add further fuel to the debate over compensating student athletes.
“When we see what kind of money is being tossed around and how much money is made off players,” McCann said, “it could invigorate this debate. It will hit at the core issues of amateurism.”
Keller, who was named the 2004 Sun Bowl’s MVP for leading Arizona State University to victory, filed the first lawsuit in May 2009. He accuses the NCAA, its commercial arm Collegiate Licensing Co., and video-game maker Electronic Arts Inc. of using student athletes’ names, images, and likenesses without compensating the athletes.
O’Bannon, 38, filed his lawsuit two months later, and six more nearly identical lawsuits followed.
O’Bannon claims the NCAA violated antitrust laws when it compelled him to sign away commercial rights to his image before he could play basketball for UCLA. Eleven former student athletes have since joined O’Bannon’s lawsuit.
He said the NCAA uses that form to prevent him from earning royalties when the NCAA licenses his image to video game makers, television networks, apparel makers, and many others who continue to market the 1995 UCLA Bruins basketball team, which won the national championship.
The seven other lawsuits make similar claims, with Keller taking particular aim at the NCAA’s contract with Electronic Arts, which makes video games based on college football and basketball that Keller claims uses images of student athletes without compensation.
The NCAA counters that O’Bannon and all other former student athletes are free to market themselves as they see fit.
“There are a lot of inaccurate claims,” said NCAA spokesman Bob Williams, who said former athletes such as O’Bannon and Keller are free to make deals with anyone they choose. “The NCAA does not license its students’ likenesses.”
All the lawsuits are seeking class action status to represent untold thousands of current and former athletes. Antitrust verdicts are tripled.
“If they are successful, it could mean a lot economically in terms of damages,” said Rick Karcher, who directs the Center for Law and Sports at Florida Coastal School of Law.
O’Bannon said even if the players lose, he still hopes his efforts will have brought student athletes closer to compensation from video game sales and other marketing efforts.
“This was a great opportunity to pave the way for student athletes to get paid,” said O’Bannon, who works as a Toyota salesman outside Las Vegas. “It’s something that is long overdue.”