California Class Action Involving College Athletes Seeking Royalties Allowed to Proceed

Plaintiffs recently won a significant victory in the pending anti-trust lawsuit brought against the NCAA, Collegiate Licensing Company and EA Sports when a federal judge rejected the NCCA’s early challenge to the litigation proceeding as a class action. The lawsuit seeks damages for use by the NCAA, its sports’ marketing company and EA sports for the use of college athletes’ likenesses, images and names on television and in video games. While the ruling did not authorize certification as a class to the former players, it did fend off the attempt by the NCAA to strike the certification motion.

In a 33 page brief the NCAA contended that the plaintiffs had changed their legal and factual positions in recent months and that such “gamesmanship” should not be rewarded. This shift involved including current players and television footage as opposed to just former college athletes. While the federal judge conceded that the NCAA’s objection may be relevant to a motion for class certification on the merits because the class has been expanded, she would not prevent the plaintiffs from moving for class certification based on a procedural defect.

The NCAA motion was intended to limit the potential exposure in the class action, which could be considerable if both past and current athletes are allowed to move forward in the class action. The stakes are extremely high, as evidenced by the request that former and current men’s college basketball and football players receive half of the revenue the NCAA generates from use of the player’s images, likenesses and names. The NCAA was attempting to reduce its liability if it does not prevail on the merits by excluding current players as members of a certified class. The ruling keeps the possibility of current players joining the lawsuit a possibility.

While the judge permitted the NCAA and the other defendants to re-file objections to certification, she also indicated that any new paperwork filed should indicate why the plaintiffs should not be allowed to change their legal theory as it pertains to current players.

The stakes in this pending class action could represent a potentially landmark decision in terms of the way college athletes are compensated. While the lawsuit does not seek to have current student-athletes compensated during their period of eligibility, money generated by use of the image, likeness and name of current student-athletes would be held in trust until after they have exhausted their college eligibility.

The litigation against the NCAA illustrates the potential scope and power of class action litigation to affect significant changes, which impact society in fundamental ways while providing compensation to a large number of those who have been harmed.

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