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NCAA loses O'Bannon Case

Discussion in 'Sports Zone' started by burmafrd, Aug 8, 2014.

  1. ABQCOWBOY

    ABQCOWBOY Moderator Staff Member

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    You also can't assume that this means better.
  2. ABQCOWBOY

    ABQCOWBOY Moderator Staff Member

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    No more names on the backs of Jerseys. Problem solved.
  3. peplaw06

    peplaw06 That Guy

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    I suppose it's a matter of opinion.

    I prefer a system where people get paid when their likeness is exploited, and I think most people prefer it that way, seeing as how that's the way this country's laws work.

    I guess if you think that it is better when people can be exploited by anyone for any reason without compensation, then you can fear that this system won't be better.

    You're just really not going to like the way this goes.
  4. ABQCOWBOY

    ABQCOWBOY Moderator Staff Member

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    One person's exploitation is another person's opportunity. I don't think this is going to make things better, that's true but on the other hand, in a few years, you may find that it's you who doesn't like how this goes.
  5. peplaw06

    peplaw06 That Guy

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    Exploitation is a term of art.

    And how exactly is Ed O'Bannon being put on a video game when he's 40 years old and long gone from UCLA, and not being compensated for it, an "opportunity?"
  6. ABQCOWBOY

    ABQCOWBOY Moderator Staff Member

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    Is that what you call it?

    I haven't really seen O'Bannon on a video game in some time but whatever. If O'Bannon had never played College BBall, he would never have played in the NBA. I'd certainly say that UCLA provided him more opportunity in life then the overwhelming majority of people in the World. Honestly, I'm not even sure how that could even be in question.
  7. casmith07

    casmith07 I'm the best poster in the game!

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    Well, he's not an attorney, so cut him some slack :p

    Good point, taken.
  8. peplaw06

    peplaw06 That Guy

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    Yes... I know it doesn't make you feel all warm and fuzzy to hear the term "exploitation" used when defending your precious NCAA, but that's what it is. Exploitation of a person's likeness is a term of art for "making money" off of the person's likeness by using it in a specific medium.

    What do you mean by "some time?" When did you last see him in a video game? Do you even know what this case is about? Might should google it.

    So because a player plays college basketball, and may have made the NBA, that gives the NCAA the authority to exploit the player's likeness in perpetuity without compensation to the player? What about the guys who were on the 1995 championship team or other legendary teams who didn't make the NBA? Their likeness can be exploited in perpetuity as well?

    You have no idea if he could have made the NBA without college basketball. It just so happens that college basketball was the only real path to the NBA at the time he was there.

    O'Bannon said this morning he thought he got the "bare minimum" at UCLA in terms of education and opportunity. So I think he would "certainly" disagree with you...

    So, hypothetical for you.......

    Your first ever job was at say McDonald's. You worked for them for a few years during high school, and they paid you and wrote letters of recommendation to your future employer(s). 15 years after you worked there, you're cruising the highway on a Sunday drive, and you see your picture on a McDonald's billboard. You never gave them permission to use your likeness, and you never got compensated for it. What do you do? Chalk it up to, "well they gave me a great opportunity," and forget about it? Or do you feel like you should be compensated for them using your picture to make money?
  9. peplaw06

    peplaw06 That Guy

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    Hey, I'll cut him all the slack in the world if he'll just admit to not knowing what he's talking about. Instead, he's digging in his heels.
  10. burmafrd

    burmafrd Well-Known Member

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    just like you claim to know more than you do- and you refuse to admit that judicial activism and over reach happens a fair amount of time; just as all too often especially in the past the judges ignoring things (Fugitive Slave Law, etc) because they did not want to deal with it. So your claim that no judge would tell them to throw out the rule book and start over is total horsecrap.
  11. burmafrd

    burmafrd Well-Known Member

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    that is rich. Unless you are a famous person that means nothing. Look at all the crowd shots used by many advertizers. You think they got releases from every one in that crowd? BS.
  12. joseephuss

    joseephuss Well-Known Member

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    Usually when you purchase tickets for an event there are agreements/disclaimers about how your likeness may be utilized and/or signs are posted at the venue that indicate the same.
  13. ABQCOWBOY

    ABQCOWBOY Moderator Staff Member

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    This is not personal for me so for you to characterize it as such is simply wrong. No, I don't think this is beneficial for sports or for the players in the long run, at least not all of them. You want to make this into something it is not. That's a mistake but it is yours to make.


    I mean, it's been some time since I've seen O'Bannon used to market video games.

    You said this: And how exactly is Ed O'Bannon being put on a video game when he's 40 years old and long gone from UCLA, and not being compensated for it, an "opportunity?"

    I simply responded to what you asked. You made no mention of anything other then the usage of his likeness to market video games. You didn't ask about any other aspect of this issue. If you find my answer unsatisfactory, I am sorry but you got the answer to the question you specifically inquired about.

    Perhaps it is not my lack of understanding in play here.

    This is supposition on your part.



    Perhaps but the same could easily be said in the reverse. Had he not played College Basketball, there is a very, very good chance that he would not have been drafted. Can you say, with any amount of certainty that he would have been drafted into the NBA had he not played College Basketball. Can you even make an argument that his chances would have been better, had he not played College Basketball?

    O'Bannon can disagree if he wishes but he could have studied anything he wanted, while at UCLA. The opportunity for education was available. If he did not take advantage of it, where does the fault rest?

    Firstly, playing College Basketball for UCLA, at the time, was not a job so your hypothetical begins to diverge there.

    However, if my first job was for McDonald's and if McDonalds sent me to a Major University, all expenses paid, for an opportunity to get a College Education from a major University, I would have no problem with them using my likeness on a billboard. Further, I'd imagine that language would have been written into any agreement I might have signed to allow for this. I would consider that to be a bargain.
  14. peplaw06

    peplaw06 That Guy

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    Actually, I already said judicial activism happens... right here.

    It still has literally zero to do with this thread. As casmith said, this is a trial court, not an appellate court. Judicial activism is something often talked about in appellate courts.

    I didn't say "no judge would tell them to throw out the rule book." I said this court doesn't have the jurisdiction to do that. I doubt you will see the distinction though.
    zrinkill likes this.
  15. peplaw06

    peplaw06 That Guy

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    Every time there is a story about the NCAA system, you will be found defending the NCAA and hating on the athletes. It may not be "personal," but you seem to have some kind of agenda.

    What I mean is how long is "some time" for you? I'm really just interested in whether you know the specifics of this case or if you think we're talking about a video game made in 1995... It sounds like the latter, which is why I said you might need to learn about the facts of this case first.

    Your response was that he was given an opportunity in college. Well, the video game that his likeness was in was made LONG after he left college and his NBA career was over. Which is why I asked if being in college and playing sports gives your school the right to exploit your likeness in perpetuity...

    No, it's not... the game in question had "legendary teams" on it, including Ed O'Bannon's 1995 team (along with players who didn't play in the NBA), and Oscar Robertson's Cincinnati team and Bill Russell's USF team, among others. Presumably those teams had players on them who did not play in the NBA and their likenesses were used. Those are facts, not supposition.

    If the NBA didn't prevent high school players from entering the NBA draft out of high school, he very well could have been in the NBA. Or if there was some other minor league system that he could have entered, then he could have made the NBA.

    Sorry, but just going to college to play basketball doesn't give the NCAA the right to exploit your likeness forever. That's why the court ruled the way it did. Sorry if it ruffles your feathers.

    Oh, the tired old personal responsibility argument.

    The NCAA makes money off these guys hand over fists, not only when they are in school, but afterwards... And that's okay with you because they got 3-4 years of education. Riduclous.

    No, that's not what I said. I said they paid you for your services. Giving the athletes an education is the compensation for their service in playing their sport, so the hypothetical is parallel. If they didn't play their sport, then they wouldn't get their scholarship. And if they didn't get the scholarship, they wouldn't play the sport for that school.

    You are so hell bent on defending this corrupt and exploitative (not used as a term of art here) system that you have become a caricature of yourself. You dismiss hypotheticals and try to reframe the issues so you can feel like you're still on moral high ground. It would be funny if it weren't so sad.

    But I guess you should congratulate yourself.... it took you less than one page to prove to me that you're not going to consider admitting anything that makes the NCAA look bad.... so I'm just going to stop responding to you, since it's clear you want to take this thread into the round and round abyss you like so much.

    I'll just continue to watch the courts blow up the NCAA as we know it.

    Have a good one.
  16. peplaw06

    peplaw06 That Guy

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    In The O'Bannon Decision, Truth Wins Out Over Rhetoric

    by Andy Schwarz


    Let me start by apologizing. Because of my own involvement in the Ed O'Bannon case, and because of past situations in which the NCAA has misquoted my own personal statements as if they represent the official opinions of the plaintiffs in the case, I can't be quite as analytical here as I might like, especially since the NCAA has already announced it will appeal the decision. But I think a few thoughts are in order.

    Factually, the opinion handed down Friday strikes a blow against the primary defenses on which the NCAA has relied for decades. The first is that the public would stop watching college football and basketball if athletes were to be paid more than the current scholarship maximum—or, as the NCAA has begun to accept in the last decade, the slightly higher full cost of attendance—for their athletic skill. U.S. District Judge Claudia Wilken understood the problems in the survey on which the NCAA relied and agreed that other than that, all the NCAA had offered up were assertions by witnesses that were contradicted when those same witnesses explained that fans love the game, the pageantry, the affiliation with their alma mater, winning, etc:

    Thus, the Court finds that the NCAA's restrictions on student-athlete compensation are not the driving force behind consumer demand for FBS football and Division I basketball-related products. Rather, the evidence presented at trial suggests that consumers are interested in college sports for other reasons.

    This is a powerful rejection of the core (and never tested) NCAA assertion that "amateurism" drives public demand. This ruling, if it stands, says that "amateurism" as a philosophy is simply price fixing with better PR.

    Second, Judge Wilken also rejected the competitive-balance defense, an argument the folks at the NCAA have repeatedly failed to make successfully. They tried in Board of Regents v. NCAA and got shot down; they tried in Law v. NCAA and got shot down; and they tried here and got shot down. Unlike those other cases, here the NCAA had to make a full case for their claim, and they foundered on the fact that for decades, economists have searched in vain for a competitive-balance benefit from the NCAA's price-fixing. It's hard to prove something is true in the face of a (rare) scholarly consensus that it is false.

    Judge Wilken's opinion cut through a lot of empty rhetoric. Under the current system, the wealthiest programs receive the lion's share of revenue. If the commitment to competitive balance were so important to the people running the NCAA, the judge wondered, why hadn't they shown a much firmer commitment to leveling the playing field through revenue sharing, sending more money from the power conferences to the smaller schools? Judge Wilken seems to have found that disconnect telling:

    The Court notes, however, that the NCAA could easily adopt several less restrictive rules if it wished to increase competitive balance or output. With respect to competitive balance, for instance, the NCAA could adopt a more equal revenue distribution formula. As noted above, its current formula primarily rewards the schools that already have the largest athletic budgets. This uneven distribution of revenues runs counter to the association's stated goal of promoting competitive balance.

    Third, the NCAA argued that schools would flee Division I if their commitment to amateurism were put to the test. The other day, I suggested we all adopt the hashtag #MTBSW ("money talks and b.s. walks") to flag whenever a pious but ultimately false argument involving money falls by the wayside. If the injunction goes into effect, and schools cannot collude to prevent payments to athletes (albeit on a deferred basis) above and beyond the cost of attendance, then several of the witnesses' testimony will be put to the test.

    Judge Wilken made clear what she thinks that test will show:

    The real difference between schools in Division I and schools in other divisions and athletics associations, as explained above, is the amount of resources that Division I schools commit to athletics.

    Thus, while there may be tangible differences between Division I schools and other schools that participate in intercollegiate sports, these differences are financial, not philosophical. For this reason, the NCAA's assertion that schools would leave FBS and Division I for financial reasons if the challenged restraints were removed is not credible. The testimony of Dr. Emmert and various other athletics administrators that most Division I athletic programs operate at a loss and would not remain in Division I if the challenged rules were removed conflicts with the clear weight of the evidence.

    As one example, Jim Delany asserted that alumni bases would recoil at the thought of paying more than the cost of attendance and would exit Division I. Seeing him and other power brokers within college sports walk that back will be a classic case of #MTBSW.

    On the fourth of the NCAA's arguments, it was more of a mixed bag. Judge Wilken almost tossed this claim in its entirety, but in the end she accepted the idea that athletes having too much money their pockets might somehow harm their educations. She mentioned how the absence of rules against the children of wealth having money was inconsistent, as was the general practice of paying other students for on-campus jobs, but she ultimately gave enough credence to this idea that it got the NCAA over an important legal hump, and required the plaintiffs to prove up less restrictive alternatives. She wrote:



    Had she not bought into this argument, she might have issued a much broader injunction. Is the last bolded sentence quoted above true? I'll leave it to you to draw your own conclusions, but I will say that generally the primary reason students leave school before graduation is due to a lack of money.

    Judge Wilken also attached some credence to the idea that while there's no factual basis to the claim that the current cap on payment is a driver of consumer demand, SOME level of payment could, in theory, decrease demand:

    These two factual findings—that there might be some harm to athletes if they have too much money while they are students and that if the payments to athletes rose too high, demand for the product might suffer—appear to be the foundation of the narrow injunction Judge Wilken ordered. While she has not set a cap on payments (and don't listen to anyone who tells you she did), she has expressly said that her injunction allows the NCAA to continue to make its own caps. What's different is that the new cap on in-school payments cannot be lower than the full cost of attendance (as opposed to the full grant-in-aid, which is $2,000 to $5,000 lower) and that the cap on additional payments above this level offered before/during eligibility but paid after eligibility cannot be lower than $5,000 per year (as opposed to the current zero).

    So: the benefits of amateurism qua amateurism (in its current form as a collective ban on payment of any sort beyond a scholarship) is no longer a valid defense for price-fixing. The process of all of Division 1 coming together and fixing prices below the limits stated above is illegal. If this ruling stands, we will certainly see the most popular schools paying as much as they are allowed to pay (if/when the NCAA imposes a new cap consistent with Judge Wilken's ruling) without harm to their fans' demand for the product. "Fans only watch because athletes aren't paid" will be proven false in the marketplace. But it may be replaced with a new but related non-empirical assertion: "Fans only watch because the payments are reasonable."

    Economically, my view is that if there is actually some level of pay above which demand will decline, pay won't tend to stay at that excessive level, even in absence of a cap. Firms pay talent reluctantly; if schools pay, it will be because they believe the revenue benefits of having that athlete on the team exceed the cost. It would be a strange team that would choose to shell out more money knowing it was driving demand DOWN rather than up. In my view, to the extent that there is a point after which compensation drives down demand, we would see a market equilibrium emerge in which prices rise to that level, but not beyond. If a school went beyond it and experienced both higher costs AND lower revenue, they would quickly retreat back to the more profitable, lower-pay level. The market would set the cap without the need for an NCAA-imposed one.

    Nevertheless, under Judge Wilken's ruling, without violating her injunction, the NCAA will be able to cap payments at full cost of attendance while an athlete is in school and no more than $5,000 per year on a deferred basis. Interestingly, I don't think her ruling means that the new, higher cap wouldn't also violate the antitrust laws—that question is left for a later day, because her focus was on the restraints that exist now. But in Judge Wilken's ruling, with the evidence before her, she did conclude there was enough evidence—mostly from former CBS Sport president Neil Pilson and survey expert J. Michael Dennis—to support the idea that $5,000 had the possibility of a pro-competitive justification sufficient to withstand the current challenge.

    A rich irony is that if this ruling stands, all of the years of committee meetings past, present, and future involving the NCAA's efforts to reform its compensation levels, including this week's so-called "autonomy" vote, will be completely mooted (at least for FBS football and D-I basketball). Judge Wilken ruled that the NCAA and its conferences are forbidden from fixing prices below cost of attendance. The Power 5 can meet and make rules all they want, but if the injunction holds, they've been legally banned from enforcing any rule limiting scholarships below full cost of attendance, period. In fact, all D-I schools, even in small conferences, are now enjoined from capping their men's basketball scholarships at the current maximum. Even the process by which the schools overrode the stipend rule in early 2011 and re-capped scholarships below the full cost of attendance—a collective vote to cap pay below there—is now itself enjoined.

    All day Sunday, I was on the road and listened to a lot of college sports talk radio. The hosts, callers, and even the guests coming from the world of college sports seemed to treat the "autonomy" vote as still being a driving force for how big-time college football will look in the future. I would imagine that's wrong. If Judge Wilken's decision stands, no group of NCAA members can set any cap on scholarships below a given school's cost of attendance. So when I heard Baylor AD Ian McCaw suggest on Sirius XM's college sports channel that the Big 12 might pick some middle-ground stipend payment that splits the difference between high-cost and low-costs schools, it's clear the impact of the Wilken decision hasn't quite sunk in yet. No school, whether part of Power 5 or not, can collude with another school to fix prices below the full cost of attendance. Emphasis on FULL.

    The ruling also offers up other rulings of interest to the antitrust community. After finding that the markets for athletes' names, images, and likeness were real for each of the products in suit (live TV, rebroadcast TV, and video games), Judge Wilken then concluded that there was no anti-competitive harm in those markets. I don't think this conclusion is consistent with the economic evidence, but the impact of this conclusion was pretty much mooted by her finding that there was anti-competitive harm in the other market proven by the plaintiffs.

    In the end, though, the NCAA's long-standing price-fixing was found by a federal judge to have violated the antitrust laws. This is an important win for the forces of competition. We will get to see the college sports world pull a collective "We have always been at war with Eastasia" when they say that this new world of Full Cost of Attendance plus $5,000 per year in deferred payments is entirely consistent with the bedrock principles of amateurism that the NCAA has maintained since its founding. I hope that the public will see how little its love of college sports changes under this system, and that as a result, a still freer—and thus fairer—market than required by the injunction will soon follow. The days of a Fear of a Black Wallet may be ending.

    The liability finding was a winning day for Team Market, but the injunction itself will hardly displease Team Reform. Things got better Friday for athletes, for competition, and for America. The only question left to be answered is just how much better.

    Andy Schwarz is an antitrust economist and partner at OSKR, an economic consulting firm specializing in expert witness testimony. Follow him on Twitter, @andyhre.
  17. ABQCOWBOY

    ABQCOWBOY Moderator Staff Member

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    You are way to involved here, to the point that your posts are almost insulting. If I were as involved, this would not end well. As it is, I am not. I simply see it as a practical matter. I don't agree with you in a lot of areas here but I'm not going to belabor the point. You are looking for an argument.

    I've pretty much answered all of your questions and you've either changed the questions to suit your argument or recommended I get educated on that matter. That's fine.

    Do you realize that you have no idea what my opinion actually is in this situation? You just assume so many things here. I actually, have no real problem with players getting paid for their likeness on things like Video games. It's the other things that this ruling will effect and lead to, IMO, that I have issues with. Your statement about me always backing the NCAA is not representative of my beliefs at all. It is simply what you choose to believe.

    I don't agree with you and we'll leave it at that.
    Last edited: Aug 12, 2014
  18. peplaw06

    peplaw06 That Guy

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    You responded to me first... it's not me looking for an argument. I'm fine with a discussion... but if you're not educated on what is happening here, then yeah I'm not going to have much patience for being told that I'm not looking at the effects of the ruling. If you don't know what caused the issue here, how can you speculate on the effects?
  19. ABQCOWBOY

    ABQCOWBOY Moderator Staff Member

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    I responded to you with a statement of fact. I said that you can't know if it will be good or not. Do you dispute that statement?
  20. peplaw06

    peplaw06 That Guy

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    That's not what you said. You said I can't assume this will be better. That's not a statement of fact, because yes, I can assume that if I like. You're trying to challenge my opinion.

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