[co-author: Stephanie Kozol*,Paulette Hall**]
Anticompetitive conduct remains a priority for state attorneys general (AGs), as evidenced by a preliminary settlement between the National Collegiate Athletics Association (NCAA) and an 11-state coalition of AGs, including Virginia, Colorado, District of Columbia, Illinois, Minnesota, Mississippi, New York, North Carolina, Tennessee, and West Virginia recently entered. Notably, the U.S. Department of Justice also signed the proposed settlement agreement. Filed in the Northern District of West Virginia, the antitrust lawsuit challenged the NCAA’s transfer eligibility rule. The proposed settlement agreement is subject to approval by U.S. District Judge John Bailey, who previously granted a preliminary injunction, preventing the NCAA from enforcing the transfer rule during the spring sports season.
The transfer eligibility rule requires that athletes wait one year after transferring schools before resuming competition. Although the NCAA exempted student-athletes for first-time transfers, it continued to enforce the rule for student-athletes with more than one transfer — and failed to explain its reasoning for denying such waivers. State AGs argue that the transfer eligibility rule unlawfully restrains college athletes from marketing their talent, resulting in missed athletic opportunities. The proposed settlement obligates the NCAA to cease enforcement of the transfer eligibility, and prevents the NCAA from creating new rules or policies that undermine provisions of the agreement. In addition, the NCAA must allow athletes, who were impacted by the rule during the 2019-20 academic term, to have another year of athletic eligibility.
Why It Matters
AGs across the U.S. continue to challenge NCAA rules on antitrust grounds. These regulatory actions are expected to lead to a complete overhaul of the NCAA amateur model. These actions are giving the AGs confidence as they seemingly prevail in achieving their objectives. For example, a 2023 lawsuit briefly prohibited the enforcement of the transfer eligibility rule through a temporary restraining order. More recently, the AGs obtained a landmark $2.8 billion settlement against the NCAA to resolve three antitrust lawsuits. AGs are expected to continue wielding their powers under antitrust law to continue to shape organizations, like the NCAA, and industry-at-large, in a manner that is consistent with their regulatory priorities.
Additional articles on state AG offices in the NCAA space include:
*Senior Government Relations Manager
**2024 Summer Associate
