The O’Bannon v. NCAA Ruling—What Will It Mean?

The August 8, 2014 ruling in O’Bannon v. NCAA, 99 pages long, is still new enough that it is too soon to know how the decision will shape the future of college sports. However, a few conclusions may be drawn. The decision is analyzed for LBN by attorney Neville Johnson.

Neville Johnson

Neville Johnson

“It’s probably the most important decision in the history of college sports,” Johnson suggests. For the first time, athletes will be able to be compensated. The NCAA has announced that they will ask the court for clarification, and they will likely appeal to the 9th Circuit. However, Johnson says, the judge wrote a very detailed opinion and ruled against every defense that was raised.

The court’s opinion offers several possibilities for compensation. One would be to raise the grant-in-aid limits to allow stipends derived from licensing revenues to match up what it would cost to attend the school.

Another suggestion was that a share of licensing revenues could be put into a trust for student athletes to be paid to them after they leave the school. Schools may offer at least $5,000 per athlete. However, it appears that the NCAA will be trying to diminish the use of the likenesses of student athletes, so as to shrink that source of funding.

Another twist to the licensing of likenesses issue is that Electronic Arts will no longer be offering its video games featuring the likenesses of student athletes as a result of the settlement it reached in the case of Keller v. Electronic Arts, reported on by LBN. The NCAA is no longer licensing the games.

When an athlete graduates, if he still has some marketability, he may be able to be compensated. In discussing all the possibilities and unknowns, Johnson suggests that perhaps the NCAA will be able to come to accept the situation and work out the best way to deal with the compensation issue, including how much the compensation should be. Johnson points out that colleges receive great amounts of money from sports, so it would not be unreasonable to share it with the athletes.

Johnson’s opinion of the ruling is that it will not permit athletes to sell endorsements during their college careers. In the end, much is still to be decided.

Neville L. Johnson is a founding partner of Johnson & Johnson, LLP. He specializes in media, entertainment, class action, privacy, and complex business litigation matters. Mr. Johnson is a graduate of the University of California, Berkeley, where he was Phi Beta Kappa. He received his law degree from Southwestern University School of Law, graduating at the top of his class. The Legal Broadcast Network is a featured network of the Sequence Media Group.

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