Walter “Fritz” Metzinger
Stone, Pigman, Walther, Wittmann, L.L.C.
909 Poydras Street, Suite 3150
New Orleans, LA 70112
In many ways, 2021 marked a return to a semblance of normalcy in the sporting world. The proliferation of vaccines enabled crowds to return to sporting events, and tent-pole events postponed from 2020 (most notably the Summer Olympics) were able to proceed. In terms of sports-related commercial litigation and disputes, however, the year was anything but “normal.” From a landmark Supreme Court decision regarding amateurism to a stunning (and quickly foiled) European soccer conspiracy to lingering litigation resulting from the COVID-19 pandemic and resultant shutdowns, the year featured a bevy of sports-related suits and incidents that could shape the business of sports for years and decades to come. Below is a brief summary of a few of the cases that occurred or were resolved in 2021.
Part I – NCAA
§ 1.1. NCAA v. Alston, 141 S. Ct. 2141 (June 21, 2021)
Directly addressing the antitrust legality of the NCAA’s student-athlete compensation limits for the first time, the Supreme Court unanimously affirmed the lower courts’ holding that the NCAA’s restrictions on “education-related” compensation to Division I athletes were unlawful.
The plaintiffs in Alston were current and former student-athletes in men’s Division I FBS football and men’s and women’s Division I basketball players. Their initial suit challenged, on antitrust grounds, the NCAA rules capping the amount of “grant-in-aid” scholarship a Division I college or university can offer to a scholarship athlete at roughly the “cost of attendance” of the institution. The players argued that, by conspiring to arbitrarily “fix” the compensation student-athletes could otherwise earn in a free market for their services, NCAA member schools violate Section 1 of the Sherman Act under a “Rule of Reason” analysis. In response, the NCAA argued that its interest in preserving “amateurism” justified its grant-in-aid rules and that the Supreme Court recognized that its compensation rules were presumptively legal in its 1984 decision in NCAA v. Board of Regents.
Applying the full “Rule of Reason” analysis, the district court found that the NCAA’s restrictions on grant-in-aid were anticompetitive and not justified by the NCAA’s ever-shifting concept of “amateurism.” However, the court did find that the NCAA had a procompetitive interest in restricting payments to athletes that were “unrelated to education,” so as to distinguish student-athletes from their professional counterparts. The district court thus enjoined the NCAA from enforcing rules that limited athletes’ “educational” compensation, such as laptops and lab equipment for studies, payments for tutoring, and post-eligibility internships. In addition, the court increased the limit of cash award for athletic achievement to $5,980, the maximum a high-achieving football player could earn in additional cash benefits. The Ninth Circuit affirmed the district court in full, prompting the NCAA to petition for certiorari. The plaintiffs opted against appealing the portion of the judgment preserving the NCAA’s ability to limit compensation “unrelated to education.”
Writing for a unanimous court, Justice Gorsuch first addressed whether the NCAA’s rules were subject to a full Rule of Reason antitrust analysis or were afforded a deferential “quick look” standard. Justice Gorsuch explained that while a “quick look” will often be enough to approve the restraints “necessary to produce a game”—such as rules about the length of a game, the frequency of games, and the number of players on …