The United States Supreme Court unanimously held that the National Collegiate Athletic Association (“NCAA”) cannot restrict education-related benefits provided by its member schools to student-athletes. The decision in NCAA v. Alston, 141 S. Ct. 2141 (2021) arises out of a class-action lawsuit filed by current and former Division I student-athletes against the NCAA alleging anti-trust violations that restrict student-athletes from receiving a fair market rate for their labor. Anti-trust laws operate to promote competition between businesses and organizations to prevent monopolies by creating an even playing field among similar businesses.
The appeal to the Supreme Court stems from a federal district court ruling that permitted the NCAA to continue restricting benefits unrelated to education like cash payments to student-athletes in the form of salaries but prohibited the NCAA from restricting education-related benefits such as graduate school scholarships, post-graduate internships, and free laptops. The 9th Circuit Court of Appeals affirmed the decision of the district court, and the decision was appealed to the Supreme Court. The scope of the decision pertained only to the subset of NCAA rules restricting education-related benefits enjoined by the district court, not an across-the-board challenge to the NCAA’s rules restricting student-athlete compensation.
The NCAA urged the Court to overrule the 9th Circuit, arguing the lower courts misapplied the anti-trust standard of review, endorsing a less stringent examination to preserve the institution and integrity of American collegiate sports. Adding to this, the NCAA advanced the argument that because the NCAA is a joint venture offering its customers a unique product of intercollegiate athletic competition, the Association and its member schools are not a commercial enterprise, but are institutions advancing the societal objective of undergraduate education. In response, the athletes argue that the NCAA is asking for a complete exemption from federal anti-trust laws based on the NCAA’s reliance on a loose and inconsistent concept of “amateurism” and its importance in the realm of higher education. Pointing to the rapid ascension of college sports into the mainstream, the athletes underscore that the NCAA is a multi-billion-dollar business with television contracts in the billions per year that is only made possible by maintaining monopsony power – monopoly control on the buyer side – over the labor market for college athletes and price-fixing the ceiling on those labor costs.