Latest on the O'Bannon case

[Jay Bee]

If the student athlete wants to remain a student athlete, they do give up their right to use their likeness for profit. So they are signing a contract giving up their right to their likeness for the time they are an amateur. They are free to quit school and go make commercials, sell cars, etc. They just cannot do it in a college uniform. I agree with you on the whole rights in perpetuity argument. Nowhere, does it say this. That is what the suit should be about (and technically, I think it is). After graduation, the NCAA should not be able to use a players likeness to sell a video game. Have not read the case in depth, but did Obannon sue EA sports previously?

"The student-athlete signs their scholarship form 08-3a, giving the NCAA exclusive use of the student athlete's likeness" is what you said. NO!

Now you say, "So they are signing a contract giving up their right to their likeness for the time they are an amateur."

College athletes are not eligible to make big bank for being an athlete while in college. EVERY ONE KNOWS THIS - THIS IS NOT BEING DISPUTED! It's fact. If they do, they will likely be ineligible for competition.

What a student-athlete does is authorize the NCAA to use the SA's image & name for promotional purposes. That's it. Most media claims it to be something far more (and most people believe this, including you).

O'Bannon originally brought forth suit "because" EA had a game with an old UCLA team in it. However, the NCAA has NEVER licensed the use of a former SA's image or likeness to EA or any other video game producer. Is there a decent question as to whether EA paid $ to the NCAA, with the plan of making players in the game look like / "rated like" real players? Sure.

But that's not where the case is going. There are no exclusive rights that the NCAA has on a player's image or name. There are also no (directly) licensing of a player's image or name the NCAA does.

The plaintiff could turn into a huge group that includes challenges whether student-athletes should be paid. There is past case law that has dealt with this. I'm OK with having that debate, but the claim of exclusive rights to license for profit that are signed away in some contract is nonsense.

[ChicosBailBonds]

Have any of you people ever heard of a market economy? It aint morals folks... it's the market. Cut Buzz's salary by $1 million and see how fast Hiroshima happens and he's on his way to the University of Texas.

Why do you think the Big East as we knew it is gone? Market economy folks. Those football schools get paid more playing with football schools rather than basketball specialists.

Let's face it, as much as those morons running universities today want to argue about morals, costs and benefits, they're capitalists, just like I am. They're following the Gordon Gecko belief, "Greed is Good!" Their fight against the O'Bannon lawsuit is designed to protect the goose laying the golden eggs. Paying athletes means change and means the gold gets distributed wider and less favorably.

Yes, and largely I agree with a market economy, but not for all things.  It's never that simple.   Should the NFL have a market economy and no revenue sharing so the Dallas Cowboys, NY Giants, and a few others get 80% of the revenues?  What would happen to competition?  Why are the Bengals getting the same split of the television pie despite the Cowboys having much better tv ratings?  People watch the Cowboys, not the Bengals....in a market economy they would be the benefactors not every team.

Would Marquette be able to survive athletically on its own without forming an alliance like the Big East?  Absolutely not.   

In college athletics, the two revenue driving sports fund everything.  Think of it like the USA where the 53% of us that pay federal income taxes fund the whole enchilada for the other 47%.  It is what it is.

[StillAWarrior]

Small piece. Well, let's say Buzz's pay is cut by $1 million. That's $76,923 for each of 13 scholarship basketball players. I doubt they'd call nearly 77k "small."

How much would each athlete get if you gave a share to every scholarship athlete at Marquette?  Even if the NCAA would put aside the amateurism issue that would prevent such payments, I would think that Title IX would probably require everyone to get paid.  Not sure, though.

[ChicosBailBonds]

And that would be a problem, why? If the market can't support those people, others shouldn't be forced to subsidize. Same goes for entertainment as it does for college athletics.

As I've said before, there is no such thing a truly free market in this country.  It's a facade...a fairy tale. 

[WarriorInNYC]

How much would each athlete get if you gave a share to every scholarship athlete at Marquette?  Even if the NCAA would put aside the amateurism issue that would prevent such payments, I would think that Title IX would probably require everyone to get paid.  Not sure, though.

If every scholarship player for D1 mens basketball and D1-A football was to receive a mere $2,000/year, that would cost the NCAA just under $25 million.

I think the $2K figure is quite conservative, and this would probably have to extend to other sports as well.

[ChicosBailBonds]

If every scholarship player for D1 mens basketball and D1-A football was to receive a mere $2,000/year, that would cost the NCAA just under $25 million.

I think the $2K figure is quite conservative, and this would probably have to extend to other sports as well.

I get a slightly larger number, but only if counting scholarship players.  Next question would be if all players need to be paid on those teams.  The biggest question is whether you could contain it to just those two sports and those two divisions....remember DII is scholarship, as is DI-AA for football.  If you have to offer payment for all sports, now the numbers start to add up fairly quickly.

[keefe]

Have any of you people ever heard of a market economy? It aint morals folks... it's the market. Cut Buzz's salary by $1 million and see how fast Hiroshima happens and he's on his way to the University of Texas.

Why do you think the Big East as we knew it is gone? Market economy folks. Those football schools get paid more playing with football schools rather than basketball specialists.

Let's face it, as much as those morons running universities today want to argue about morals, costs and benefits, they're capitalists, just like I am. They're following the Gordon Gecko belief, "Greed is Good!" Their fight against the O'Bannon lawsuit is designed to protect the goose laying the golden eggs. Paying athletes means change and means the gold gets distributed wider and less favorably.

Workers of the World Unite! You have nothing to lose but your chains!

[TJ]

A head coach's salary is a small piece of a program's operating expenses. It's an easy thing to get people all freaked out about, but whether you're paying a guy $1 million or $2 million to coach.. that's not going to cure your expense problem.

But cutting badminton is?

[Jay Bee]

But cutting badminton is?

Stick to the topic. This is irrelevant to anything I've said.

[ChicosBailBonds]

MU Sports Law Institute weighs in

http://www.nj.com/college-basketball/index.ssf/2013/06/ed_obannons_lawsuit_against_ncaa_could_have_landmark_implications.html

[TJ]

Stick to the topic. This is irrelevant to anything I've said.

I was connecting the whole stream of quotes and you probably had long since forgotten the first two, so  here is the full context:

Quote from: Terror Skink on June 20, 2013, 09:05:32 AM
New York Times article this morning:

http://www.nytimes.com/2013/06/20/sports/high-stakes-games-critical-step-for-suit-seeking-payment-for-college-athletes.html?pagewanted=1&_r=0&hp

Some of the emails referenced express a lot of concern about the use of the likenesses in the video games, but they were talked down by the people who wanted to maximize the revenue.

Personally when I read statements like this, I want to throw up:

"If athletes were to receive a portion of the television money they help generate, college sports could be irreparably harmed, according to a series of written statements filed with the court by Delany and other college and conference executives."

"Irreparably harmed???"  Seriously?  Stop the hyperbole.

Quote from: ChicosBailBonds on June 20, 2013, 09:50:40 AM
He's talking about the other college sports that football and basketball fund.  Women's hoops, crew, gymnastics, golf, volleyball, track, etc, etc.  The pie is only so big so if X% now goes to the student athletes, that's X% less for the funding of sports.  Either you have to grow the pie (talk to the people on this board who are furious at their television bill...that's the source of growth) or you have to cut somewhere.  In some cases, irreparably harmed is accurate because you may see the complete elimination of support for some niche areas.  I don't think he's talking in totality by examining all sports, not just the ones that people think about (football and basketball).

Quote from: MU82 on June 20, 2013, 10:13:12 AM
The cynic could say that every football and basketball player could receive decent compensation if paid for by the head coaches in those two sports who make absurd money. Coach pay has spiraled out of control in just the last couple of decades.

Quote from: Jay Bee on June 20, 2013, 10:18:26 AM
A head coach's salary is a small piece of a program's operating expenses. It's an easy thing to get people all freaked out about, but whether you're paying a guy $1 million or $2 million to coach.. that's not going to cure your expense problem.

Chicos said that money to pay student athletes would have to come from somewhere indicating that cuts would have to be made to non-revenue sports.

MU82 was saying that instead of paying for it by cutting non-revenue sports the coach's absurdly high salaries could be cut instead.

You said that coach salaries are a drop in the bucket wouldn't be a large enough cuts.

So I asked... cutting Badminton would be?  What could be done if cutting the largest salary at most universities wouldn't be enough?


I know that you probably weren't thinking in this context when you made your statement about coach salaries being small compared to the full budget.  I don't necessarily disagree with you either - outside the top 50, how much are the other 100+ basketball coaches really making? However, your example was $1 million in savings - that could go a long way towards preventing a lot of other budget cuts.

[dgies9156]

Ok here's an idea for dealing with the O'Bannon legal concern:

1)   For valuable consideration, the intercollegiate athlete provides the university with raw materials for entertainment and public relations/marketing.

2)   For valuable consideration, the intercollegiate athlete allows the university and its agent, the NCAA, to use his or her likeness forever.

3)   For his or her services, the university provides valuable consideration to the intercollegiate athlete in the form of education, housing, nourishment and certain ancillary support necessary to complete the education (aka, books and supplies).

Is not the exchange between the university and the intercollegiate athlete a barter transaction? If your employer paid you with a non-cash good or service for your work and you did not pay taxes on it, would not the Internal Revenue Service be knocking on your door, perhaps with an indictment for tax evasion?  Of course they would!

In addition, the intercollegiate athlete must meet certain job requirements, such as training, showing up for class, adhering to a code of conduct and meeting minimum proficiency standards. Sounds an awful lot like the intercollegiate athlete is an employee of his or her university!

All you liberals reading this -- including you liberal university administrators -- ought to be excited at the thought of both the federal and state government taxing the intercollegiate athlete. And, requiring payment of Social Security taxes. Oh, but where other than the university would an athlete get the cash to make these tax payments?

It sounds as if the NCAA is a confederation of universities banded together with the goal of, among other things, limiting the negotiation power and ultimate compensation of the intercollegiate athlete. In America, we call this a monopoly and it has been illegal (except for Major League Baseball) since the Sherman Anti-Trust Act became law in the early 1900s.

Go get ‘em Ed O’Bannon!!!

[TJ]

Ok here's an idea for dealing with the O'Bannon legal concern:

1)   For valuable consideration, the intercollegiate athlete provides the university with raw materials for entertainment and public relations/marketing.

2)   For valuable consideration, the intercollegiate athlete allows the university and its agent, the NCAA, to use his or her likeness forever.

3)   For his or her services, the university provides valuable consideration to the intercollegiate athlete in the form of education, housing, nourishment and certain ancillary support necessary to complete the education (aka, books and supplies).

Is not the exchange between the university and the intercollegiate athlete a barter transaction? If your employer paid you with a non-cash good or service for your work and you did not pay taxes on it, would not the Internal Revenue Service be knocking on your door, perhaps with an indictment for tax evasion?  Of course they would!

In addition, the intercollegiate athlete must meet certain job requirements, such as training, showing up for class, adhering to a code of conduct and meeting minimum proficiency standards. Sounds an awful lot like the intercollegiate athlete is an employee of his or her university!

All you liberals reading this -- including you liberal university administrators -- ought to be excited at the thought of both the federal and state government taxing the intercollegiate athlete. And, requiring payment of Social Security taxes. Oh, but where other than the university would an athlete get the cash to make these tax payments?

It sounds as if the NCAA is a confederation of universities banded together with the goal of, among other things, limiting the negotiation power and ultimate compensation of the intercollegiate athlete. In America, we call this a monopoly and it has been illegal (except for Major League Baseball) since the Sherman Anti-Trust Act became law in the early 1900s.

Go get ‘em Ed O’Bannon!!!

+1

[ChicosBailBonds]

It sounds as if the NCAA is a confederation of universities banded together with the goal of, among other things, limiting the negotiation power and ultimate compensation of the intercollegiate athlete. In America, we call this a monopoly and it has been illegal (except for Major League Baseball) since the Sherman Anti-Trust Act became law in the early 1900s.

Go get ‘em Ed O’Bannon!!!

I'm anything but a liberal, but your case precedent doesn't apply here.  These are not employees, unlike your examples.  Now, that might be what they argue, in fact I'm sure they will, but we've been down this road before.  I thought the comments from the Sports Law attorney at MU helped to clarify this as well.

[TJ]

I'm anything but a liberal, but your case precedent doesn't apply here.  These are not employees, unlike your examples.  Now, that might be what they argue, in fact I'm sure they will, but we've been down this road before.  I thought the comments from the Sports Law attorney at MU helped to clarify this as well.

They may not be employees, but a monopolistic entity does work hard to limit their negotiation power and compensation.  It's hard to argue against that - I don't think the courts are going to buy the "go to Europe if you don't like it" argument.

The NCAA will probably win overall using their "non-profit"/"protecting student athletes" argument, but the above will remain true.

[WarriorInNYC]

It sounds as if the NCAA is a confederation of universities banded together with the goal of, among other things, limiting the negotiation power and ultimate compensation of the intercollegiate athlete. In America, we call this a monopoly and it has been illegal (except for Major League Baseball) since the Sherman Anti-Trust Act became law in the early 1900s.

Go get ‘em Ed O’Bannon!!!

Actually, this is not called a monopoly.  A monopoly is one source providing one service to all within the market with no other options for the buyers to go to.  What this could maybe be called is a cartel, in which multiple sources band together for bid rigging, price fixing, etc.

What you fail to consider is each school's education and other services (including reputation of sports programs) carry different values.  The volleyball player who gets a full-ride scholarship to Boise State has less value received compared to the field hockey player who gets a full-ride scholarship to Harvard.  Additionally, those players who are more qualified (both academically and athletically) have more choices.  The basketball player who wants to make the NBA has a choice to attend UWM or Marquette will more likely choose MU as there is more value perceived there (in other threads we talk about the reputation of MU players such as Butler, Crowder, Wes, etc. that could help Vander get drafted).

Since each program and school has different values for the education, prestige, reputation, etc. that they provide, then there really is no bid rigging or price fixing occurring is there?  The players, if they are qualified (again athletically and/or academically), will have other options at other schools that provide different levels of value.

That said, I really dont think the relationship between school and "student-athlete" can be considered an employee-employer relationship at all.  A similar case could then be made for students who receive academic scholarships as they are given valuable consideration in the form of education, books, etc.  but they also provide the school valuable consideration in the form of research, academic status, recruiting, etc.  Additionally, they also have to maintain certain grade requirements.  

The one part of O'Bannon's argument I do think carries weight is the use of the likeness after school (graduation or leaving early).  Using images and the name of the "student-athlete" after school should be ok as long as the images were taken while the "student-athlete" was in school.  But licensing the likeness of the "student-athlete" should be downright illegal.

[dgies9156]

What you fail to consider is each school's education and other services (including reputation of sports programs) carry different values.  

I am very much aware of the different values. But there is a way around this. It is called FASB ASC 820, or a valuation standard used in public accounting. ASC 820 dictates a hieraerchy of values. Since the price of a Marquette education is a published commodity (aka, tuition card), that price becomes a Level 1 value usable for financial reporting and tax purposes. Same for room, board, books and ancillary supplies. Yeah, my W-2 from Marquette will look different than a W-2 from UW-Superior!

As to the broader question of a Marquette educational value versus other schools, poppycock as well. When I was in college, UNLV was a national power in basketball and a party school in everything else. Their tuition was different than our's as was the likely value of their education (unless you wanted to deal cards in a casino).

As to the question of relative value and not fixing prices, are you kidding me? Schools act as a cartel (and your term is probably better than mine though I think the NCAA does exhibit legal monopolistic practices) and have conspired to limit the cash compensation of a student athlete to nothing. Without the cartel, the student athlete could negotiate terms of his compensation and use of his likeness.

This is where I have a serious problem because I do think schools, including Marquette, exploit their student athletes by not paying them allowing them to negotiate the terms of the use of their services and their likenesses.

[dgies9156]

Yes, and largely I agree with a market economy, but not for all things.  It's never that simple.   Should the NFL have a market economy and no revenue sharing so the Dallas Cowboys, NY Giants, and a few others get 80% of the revenues?  What would happen to competition?  Why are the Bengals getting the same split of the television pie despite the Cowboys having much better tv ratings?  People watch the Cowboys, not the Bengals....in a market economy they would be the benefactors not every team.

Hey Chicos, try this out: BECAUSE THEY AGREED TO IT! And, for the record, the NFL has had a mixed bag on monopolistic practices. Certainly the American Football League proved the NFL is not a monopoly. That renegade football league ended up merging with the NFL in 1968.

When you invest in a NFL franchise, you voluntarily agree to certain rules and regulations. If you don't like it, there's Canada or you can start your own football league. The USFL and XFL are proof of that. Oh, and yes, I know of the $1.00 anti-trust award the NFL lost to the USFL!

[WarriorInNYC]

I am very much aware of the different values. But there is a way around this. It is called FASB ASC 820, or a valuation standard used in public accounting. ASC 820 dictates a hieraerchy of values. Since the price of a Marquette education is a published commodity (aka, tuition card), that price becomes a Level 1 value usable for financial reporting and tax purposes. Same for room, board, books and ancillary supplies. Yeah, my W-2 from Marquette will look different than a W-2 from UW-Superior!

As to the broader question of a Marquette educational value versus other schools, poppycock as well. When I was in college, UNLV was a national power in basketball and a party school in everything else. Their tuition was different than our's as was the likely value of their education (unless you wanted to deal cards in a casino).

As to the question of relative value and not fixing prices, are you kidding me? Schools act as a cartel (and your term is probably better than mine though I think the NCAA does exhibit legal monopolistic practices) and have conspired to limit the cash compensation of a student athlete to nothing. Without the cartel, the student athlete could negotiate terms of his compensation and use of his likeness.

This is where I have a serious problem because I do think schools, including Marquette, exploit their student athletes by not paying them allowing them to negotiate the terms of the use of their services and their likenesses.

Ok, so you threw out a FASB reference but how does that really apply here?  The point is the value being received for each "student-athlete" is different from school to school.  So therefore how is the price-fixing occurring here?  There are different values across the board.  So I guess the top-limit of the possible compensation a "student-athlete" could receive is $240,000 (taken from Forbes most expensive colleges) of tuition + 4 years of room and board (depends on the city and school facilities - AGAIN DIFFERENCE OF VALUE - and this can be extended up to 6 years as in Otule's case) + quality of athletic facilities.

And in your example of UNLV vs. Marquette, you fail to notice the difference.  When UNLV was a powerhouse, MU was not.  Therefore those basketball players deciding to attend UNLV over MU may not have received a higher value for their education, but the value they received from the basketball program was much greater.

In the same regard, the basketball player who decides to attend MU and receive an engineering degree is getting their value from an academic and athletic standpoint.  But the basketball player who attends Georgetown and receive a government policy degree receives their value from both an academic and athletic standpoint.  The point here is while the monetary value of the actual tuition may have actual figures, the value they provide to the "student-athlete" does not actually reflect that figure.  Especially when you then factor in location, family history, academic program, etc.

[WarriorInNYC]

When you invest in a NFL franchise, you voluntarily agree to certain rules and regulations. If you don't like it, there's Canada or you can start your own football league. The USFL and XFL are proof of that. Oh, and yes, I know of the $1.00 anti-trust award the NFL lost to the USFL!

When you accept an athletic scholarship, you voluntarily agree to certain rules and regulations.  If you don't like it, there's Europe or you can start your own amateur / semi-pro league. 

[dgies9156]

Ok, so you threw out a FASB reference but how does that really apply here?  The point is the value being received for each "student-athlete" is different from school to school.  
And in your example of UNLV vs. Marquette, you fail to notice the difference.  When UNLV was a powerhouse, MU was not.  

For brevity, I reduced your quote to core issues. My response is this:

   1) My initial idea was to tax student athletes because their scholarships are compensation for services rendered. If you buy into the NCAA crapline that the students are gaining an education, then the education has value and should be taxed. And, yes, I do believe that athletes are employees. The purpose of ASC 820 is to establish a fair value (or fair market value for tax purposes) and ASC 820 encompasses a widely accepted standard for valuation.

   2) They are a monopoly. There is a conspiracy among major American universities to constrict the value received to a barter transaction. A student athlete such as Mr. O'Bannon cannot negotiate with a school to deal with specific needs and wants. That's not how our country works in the 21st century.

   3) I take it you were not alive in 1977. The Final Four that year was North Carolina, North Carolina-Charlotte, UNLV and Marquette. Guess who won!

[ChicosBailBonds]

Hey Chicos, try this out: BECAUSE THEY AGREED TO IT! And, for the record, the NFL has had a mixed bag on monopolistic practices. Certainly the American Football League proved the NFL is not a monopoly. That renegade football league ended up merging with the NFL in 1968.

When you invest in a NFL franchise, you voluntarily agree to certain rules and regulations. If you don't like it, there's Canada or you can start your own football league. The USFL and XFL are proof of that. Oh, and yes, I know of the $1.00 anti-trust award the NFL lost to the USFL!

Correct....are you saying when a high school kid accepts a scholarship he isn't also agreeing to certain terms and conditions?  I believe the student athlete does.  No gun to his or her head that they have to go to college. 

[Pakuni]

Do what big business says (and the NCAA is big business) or leave the country.  Umm, sounds more like Germany in the 1930s than the land of the free and the home of the brave.

http://en.wikipedia.org/wiki/Godwin%27s_law

[ChicosBailBonds]

For brevity, I reduced your quote to core issues. My response is this:

   1) My initial idea was to tax student athletes because their scholarships are compensation for services rendered. If you buy into the NCAA crapline that the students are gaining an education, then the education has value and should be taxed. And, yes, I do believe that athletes are employees. The purpose of ASC 820 is to establish a fair value (or fair market value for tax purposes) and ASC 820 encompasses a widely accepted standard for valuation.

   2) They are a monopoly. There is a conspiracy among major American universities to constrict the value received to a barter transaction. A student athlete such as Mr. O'Bannon cannot negotiate with a school to deal with specific needs and wants. That's not how our country works in the 21st century.

   3) I take it you were not alive in 1977. The Final Four that year was North Carolina, North Carolina-Charlotte, UNLV and Marquette. Guess who won!

The crapline that students are getting an education?  Many of these kids ARE getting an education, so why is this a crapline?  Take a step back for a moment and think of the 347 DI basketball teams, including the 250 that most people don't know about.  Those kids are going to class (usually), earning degrees, preparing for the real world.  Now, we certainly all know about high profile athletics and the kids jumping to the pros, or not going to class, etc....but even then this is an exception.

I take exception to your broad statement that they aren't getting an education...some aren't, most are being educated in one way or another.  Whether they get their degree or not, they are having to learn to prioritize, learning cognitive skills, etc. 

In your other point, how are they constricting the value received?  At Marquette, over 4 years they are having to not pay about $160K for the ability to play basketball AND get a degree AND likely use it as a springboard for a potentially lucrative career in Europe or the States.  This is constricting their value?

[mugrad99]

http://en.wikipedia.org/wiki/Godwin%27s_law

Like Willie Mays in the world Series...Great catch!