The Dangerous Economist: Supreme Court Rejects NCAA’s Tight Limits on Athlete Benefits, Compensation

The court rules the NCAA violated antitrust law by limiting schools from competing for player talent by offering better benefits

By Brent Kendall & Louise Radnofsky of The WSJ. Excerpts:

"The Supreme Court ruled unanimously that strict NCAA limits on compensating college athletes violate U.S. antitrust law, a decision that could have broad ramifications for the future of college sports.

Monday’s ruling, written by Justice Neil Gorsuch, upheld lower court rulings that said the National Collegiate Athletic Association unlawfully limited schools from competing for player talent by offering better benefits, to the detriment of college athletes.

The 9-0 decision doesn’t open up a world of direct, unlimited pay for college athletes, an issue that wasn’t before the court. Instead, the justices said the NCAA must allow colleges to recruit athletes by offering them additional compensation and benefits, as long as they are tied to education.

That means schools could offer compensation beyond the cost of attending college, such as scholarships for graduate or vocational schools, internships, computer equipment and study-abroad programs—and limited cash awards for athletes, potentially nearly $6,000 for now, who do well in the classroom."
"The court’s decision comes a day before representatives of the association’s most powerful schools and athletic conferences will again try to chart a future course for college sports in the face of a wave of state laws permitting athletes to sign endorsement deals.
Justice Gorsuch said while the NCAA is entitled to some leeway to administer the college-sports landscape, that didn’t mean the association enjoyed de facto immunity from the Sherman Act, the central federal law barring anticompetitive conduct, just because its restrictions “happen to fall at the intersection of higher education, sports, and money.”"
"The court throughout its ruling said the association still had ways to control and protect the product of college sports, but it said restricting athletes’ compensation related to education went too far."
"They just can’t all collectively agree not to provide more benefits."
"The NCAA, the court said, also retains authority to determine what kinds of compensation are and aren’t related to education"