U.S. appeals court scrutinizes NCAA over athlete pay

Reuters News
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Posted: Mar 17, 2015 7:07 AM

By Dan Levine

SAN FRANCISCO (Reuters) - A U.S. appeals court wrestled with whether student athletes should win a slice of the billions of dollars universities reap from football and basketball, amid mounting public pressure for colleges to give athletes better benefits.

The National Collegiate Athletic Association asked the 9th U.S. Circuit Court of Appeals on Tuesday to throw out an earlier ruling granting student athletes a limited share of revenue generated from use of their names, images and likenesses.

Critics say the NCAA's scholarship policy short-changes athletes who risk injury and devote many hours to practice sessions, travel and competition. The majority of college athletes do not go on to play professionally.

In a ruling last year, U.S. District Judge Claudia Wilken in Oakland, California sided with more than 20 current and former athletes who filed an antitrust class action against the NCAA.

The NCAA says it is defending amateurism in college sports.

Yet in the appeals court hearing on Tuesday, two members of the three-judge 9th Circuit panel appeared open to the idea that the NCAA's argument violates antitrust laws.

Citing a previous case which involved sharing video game revenue, Chief Judge Sidney Thomas said a ruling for the athletes in that matter "has opened a pathway for compensation."

Broadcasters including Walt Disney Co and CBS Corp have rallied behind the NCAA, arguing in a filing that the idea each participant in a team sporting event has an individual right of publicity "is simply wrong."

Yet Judge Jay Bybee on Tuesday said contracts the NCAA signs with television networks contain language about players' names and images. That suggests such rights are valuable assets that may be falling victim to anti-competitive behavior by the college sports association.

"Its clear you've got financial transactions going on here that are of great importance to both sides," Bybee said.

Even so, Bybee was skeptical of how Wilken went about trying to remedy the situation - directing that some college athletes should receive deferred payments of $5,000 per year.

"It looks to me like it crossed a line," Bybee said.

The hearing took place just a day before the NCAA's annual March Madness men's basketball tournament begins.

The lead plaintiff, Edward O'Bannon, won a national basketball championship with UCLA in 1995. He testified during trial that he usually spent about 40-45 hours per week on basketball.

"I was an athlete masquerading as a student," O'Bannon said in court.

(Reporting by Dan Levine; Editing by Christian Plumb)