O'Bannon v. NCAA: Trial over before it begins?


The antitrust lawsuit filed by former UCLA basketball star and professional player Ed O'Bannon against the NCAA is set for trial Monday in Oakland, California.

However, the the case could be over before it begins. There have been reports O'Bannon's legal team is "open" to a settlement that could take place before the 11:30 AM ET start time. But the reports stress there is no communication between the two sides.

O'Bannon, now an auto car sales executive in Las Vegas, seeks to end the NCAA's ban on compensating college athletes for the use of their likeness on items like DVDs, photos, video games and rebroadcasts of games on TV.

Former UCLA forward Ed O'Bannon.
Getty Images

But if there is no settlement, at least one analyst said the college sports governing body could come out on the losing end of the court battle.

"I think it's likely the players will win this suit," said Pat Rische, a professor of economics at Webster University and founder and director of his own sports consulting firm.

Rische said he's surprised the NCAA hasn't settled by now, but he argued the group believes the case is a make-or-break situation when it comes to how college athletes are compensated.

"The NCAA must feel that the outcome of this case could so fundamentally change the economics of college athletics that they need to put up a fight," he said.

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Rische, who said he doesn't believe college athletes should be paid beyond their scholarships, added that the massive amount of money from TV broadcasting rights of college sporting events is the driving force behind actions like O'Bannon's.

"The outcry from student athletes has become louder as the money has poured in," he said. "And you can see their point. If it weren't for the players, what would people do on Saturday afternoons or when there's other sporting events?"

Fight over property rights

NCAA's blueprint for 21st century athletes

O'Bannon is the lead plaintiff in the case, which was first filed in 2009. The suit seeks an injunction against the NCAA from profiting from the use of former college player likenesses in various forms of media and marketing. It was seeing himself on TV that got O'Bannon upset, said Exavier Pope, a Chicago-based sports attorney.

"He (O'Bannon) was sitting watching the NCAA tournament on TV and saw his name and likeness being used after he had been retired from the game for 10 years," said Pope. "He felt there was no reason to do that without some compensation."

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Pope explained that the issue is really about intellectual property rights and who owns them. "O'Bannon felt that since he's no longer an amateur, there's no reason why they should be using my name and likeness," added Pope. "The court date is a fantastic development for O'Bannon and the whole rights issue."

In setting the June trial date, U.S. District Judge Claudia Wilken denied the NCAA's motions to delay the suit. She also separated the antitrust case into two parts. Besides O'Bannon's suit, the NCAA now faces another lawsuit from former Arizona State and Nebraska quarterback Sam Keller over sports-themed video games. That trial is set for March of 2015.

Update: On Monday, the NCAA said it reached an agreement with Keller by awarding $20 million to "certain Division I men's basketball and Division I Bowl Subdivision football student-athletes who attended certain institutions during the years the games were sold."

Legal setbacks for NCAA

In other legal maneuvering, the O'Bannon plaintiffs decided not to pursue individual monetary damages, as they had been. That would have meant a jury trial instead of having Wilken, who is overseeing the case, make a decision on the injunction. The NCAA had been seeking a jury trial.

The NCAA released this statement to CNBC from Donald Remy, the NCAA's chief legal officer: "Although the plaintiffs' eleventh-hour change in strategy has denied a jury the opportunity to decide the important issues in the O'Bannon litigation, we are prepared for trial and look forward to presenting our case to the Judge. At the same time, we will continue to prepare for a jury trial in the Keller case that is scheduled for March."

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The lead counsel for O'Bannon, Hausfeld LLP, issued this statement to CNBC in December when asked for a comment on the case:

"The NCAA's rules that prohibit payment to student-athletes for the use of their names, images, and likenesses may have served a purpose in another era.

"But in this era of the commercialization of college sports and multi-million dollar broadcast contracts, these rules only serve to exploit the very student-athletes that generate the millions of dollars that pad the pockets of the NCAA.

"There is a growing public recognition that the NCAA's business practices are unfair and we look forward to proving in a court of law that they must be changed."

'Momentum is gong their way'

The O'Bannon and now the Keller lawsuits are only two parts of the long list of actions against the NCAA that seek to change the way it does business.

There are also as-yet undeclared vote results by Northwestern University football players on forming a union. And no matter which that vote goes, there's an impending decision by the National Labor Relations Board in Washington on whether any private college can vote to unionize their athletes.

Sports labor attorney Jeffrey Kessler filed an antitrust claim against the NCAA this past March in a New Jersey federal court on behalf of a group of college basketball and football players, arguing the association has unlawfully capped player compensation at the value of an athletic scholarship.

This April, former University of Minnesota football player Kendall Gregory-McGhee sued the NCAA, as well as the conferences SEC, ACC, Big Ten, Big 12 and Pac-12 over capping scholarships below the actual cost of attendance that's listed by universities.

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The tide may be turning in players' favor. Last September, an undisclosed settlement was reached in the O'Bannon suit with former defendants Electronic Arts and the Collegiate Licensing Co. That agreement may include some compensation to former college players, according to reports. Both firms are scheduled to be witnesses in the ongoing suit.

Attempts by the NCAA and EA to dismiss the various lawsuits have failed. That likely means more legal wins for players, said Webster University's Rische.

"So much momentum is going their way," said Rische.