Essay by Gary R. Roberts
Because the REC salary rule fixed a maximum price that an NCAA Division I member could pay for its fourth basketball coach (men's and women's), the plaintiffs argued that the rule should be struck down as per se illegal price fixing under the authority of the Supreme Court's landmark decision in United States v. Socony-Vacuum Oil Co. However, citing the Supreme Court's more recent decision in NCAA v. Board of Regents, as well as Broadcast Music, Inc. v. Columbia Broadcasting System, Inc., Judge Vratil followed the judicial trend since the mid-1970s of eschewing per se invalidation, noting that due to the inherent need for NCAA members to establish some rules in order to achieve the organization's lawful goals, courts cannot conclude that any NCAA rule is of a type that would “ ‘almost always tend to restrict competition.”’ In so ruling, the court quoted language from Board of Regents that is crucial for the NCAA's ability to defend its very existence: “ ‘A myriad of rules affecting such matters as the size of the field, the number of players on a team, and the extent to which physical violence is to be encouraged or proscribed, all must be agreed upon, and all restrain the manner in which institutions compete.”’
Of course, this observation is self-evident—that in order to have an “athletic competition” entertainment product, all of the participating teams must agree to the basic rules of the game on the field or court itself. It is unlikely that anyone would seriously allege that “agreements” by members of an athletic organization defining the shape and size of playing venues, the required equipment, or the rules for the conduct of the game itself would pose antitrust questions. But Judge Vratil then went on to quote further, less intuitively obvious dictum from Board of Regents:
“Moreover, the NCAA seeks to market a particular brand of [sports]—college [sports]. The identification of this ‘product’ with an academic tradition differentiates college [sports] from and makes [them] more popular than professional sports to which [they] might otherwise be comparable. . . . In order to preserve the character and quality of the ‘product,’ athletes must not be paid, must be required to attend class, and the like. And the integrity of the ‘product’ cannot be preserved except by mutual agreement; if an institution adopted such restrictions unilaterally, its effectiveness as a competitor on the playing field might soon be destroyed. Thus, the NCAA plays a vital role in enabling college [sports] to preserve [their] character, and as a result enables a product to be marketed which might otherwise be unavailable.”
From this, it appears that the Supreme Court and Judge Vratil believe that most of the NCAA's incredibly large and complex network of rules is procompetitive, on balance, and thus justifiable under the rule of reason, because they preserve the features of amateurism and academic orientation that purportedly define the unique nature of the NCAA members' sports product. It is this premise that this Essay explores in Part IV. First, however, Part III reviews how Judge Vratil applied the rule of reason specifically to the salary cap placed on RECs.
About the Author
Gary R. Roberts. Professor of Law, Tulane Law School. B.A. 1970, Bradley University; J.D. 1975, Stanford Law School.
Citation
70 Tul. L. Rev. 2631 (1996)