It was a chilly day in Cambridge, Massachusetts when Harvard Law School second-year student Greg Skidmore created Sports Law Blog. Greg's first post, dated on November 13, 2003, began by saying that sports law doesn't actually exist but is nonetheless important. "Since there is no such thing as 'Sports Law,'" Greg wrote, "this blog will be dedicated to the law and the role it plays in the sports industry."
Greg, who is now a partner at Robinson and Bradshaw, didn't know he would become a pioneer in blogging. But that is what happened. In the following years, Sports Law Blog became a place for respectful debate, thoughtful discussion and original analysis. There were times when it attractive significant attention, too, especially when ESPN and other national publications linked to the blog's posts. Michael McCann joined Sports Law Blog a couple of years in as Editor, and I joined a few years later as Assistant Editor. A number of Contributors soon followed, particularly Howard Wasserman, Rick Karcher, Geoffrey Rapp and Gabe Feldman who became regular providers of content. Sports Law Blog played an important role in all of our lives.
Mike drew the largest following among not just sports fans but other media which cited the Sports Law Blog posts as authoritative commentary as one major sports law story was followed by another and another. Soon Sports Illustrated came calling and Mike became the go to person for his lay expectations of how the law would treat the various athletes and owners who found themselves in the legal spotlight, perhaps reaching its peak with Deflategate.
As this was happening Twitter became the popular vehicle for many of the contributors to instantly communicate their thoughts on the various sports law issues that seemed to be never ending. Partly as a consequence, and because sports commentary became part of the 24/7 instant news cycle, Sports Law Blog ceased to be the relevant voice it had been in years past. All things run their course.
On March 21, Greg's Sports Law Blog will terminate. You should still be able to find all archived posts on the Wayback Machine, but the blog itself is being taken down. We are incredibly grateful for all the visits by readers and the attention you paid us. Anyone can start a blog, and anyone can start a sports law blog. But we hope Greg's Sports Law Blog will be remembered as one of the best. Warren K. Zola
This read like a NCAA press release, so let’s go paragraph by paragraph and break down why its nothing but that (NYT paragraphs in small italics):
When the Duke University basketball star Zion Williamson injured his knee in a freak accident in a game on Wednesday, it reignited a debate over whether student-athletes competing as amateurs on college campuses should instead become paid professionals. If Williamson and other elite players like him are going to risk their professional futures by playing college sports, many wonder, shouldn’t they be financially compensated?
Zion had an eight million dollar insurance policy paid for by Duke, and the NBA has now proposed lowering the draft age to eighteen years old and sent that to the NBPA. So, yes, Zion has moved public opinion in a week or so.
Paying student-athletes might sound like a fairer way to treat students who generate so much money and attention for their colleges (not to mention the television networks that broadcast their games). But paying athletes would distort the economics of college sports in a way that would hurt the broader community of student-athletes, universities, fans and alumni. A handful of big sports programs would pay top dollar for a select few athletes, while almost every other college would get caught up in a bidding war it couldn’t afford.
“Distort the economics of college sports?” These economics are already distorted, where the zero labor rate allows the Power Five Conference football and men’s basketball coaches to be paid in excess of their “professional” counter-parts, because professional teams have to pay the labor.
The 30 largest universities in the country each routinely generate annual revenues exceeding $100 million from sports, but according to the National Collegiate Athletic Association, most of those revenues are spent covering operating expenses for the school’s athletic programs and paying tuition for their student-athletes. The majority of Division I colleges in the N.C.A.A. operate at a loss. In fact, among the roughly 350 athletic departments in the N.C.A.A.’s Division I, only about 24 schools have generated more revenue than expenses in recent years. The nation’s top five conferences made over $6 billion in 2015, billions more than all other schools combined, according to an ESPN analysis of N.C.A.A. data.
The NCAA always wants to look at athletic department budgets, instead of looking at the two revenue sports, football and men’s basketball, and it always wants to talk about Division I rather than the still largely segregated P5, which is where the real money is, and even then, only in these two sports, which are dominated by black players, who largely do not graduate according to publicly available information.
For instance, looking at the so-called national championship last month, here are the numbers for Clemson vs. Alabama: Black male enrollment, 3.28% vs. 3.54%, black football grant-in-aid, 65.88% vs. 75.29%, adjusted revenue per FB GiA, $781,131.66 vs. $1,567,436.06, black FB federal graduation rate, 57% vs. 36%, white FB FGR, 83% vs. 100%.
Moreover, even if most D-I athletic departments operate in the red, why does that matter, when every undergraduate department other than athletics always runs in the red, since they don’t generate individual revenue?
For the have-not universities, however, to continue operating means relying on millions of dollars in debt, funding from their main campus and student fees. Even with that help, some of the major athletic departments are struggling. A recent N.C.A.A. study determined that only about 20 of the 1,000 or so college sports programs in the nation were profitable. What is going to happen when the competition to offer students money is supercharged?
This is gobbledygook. How does the student author think the biology, English, or history departments for example function at any given university? How would paying 85 football and 13 men’s basketball players at each of the 65 P5 universities affect the economics of the G5, FCS or the remainder of D-I, let alone D-II or D-III? None of these compete with the P5, so the answer is that it wouldn’t matter one tiny bit.
A federal judge in Northern California, Claudia Wilken, will soon decide if student-athletes should instead be paid more like professionals. At the moment, thanks in part to the pressure exerted by a 2015 ruling by Judge Wilken, top N.C.A.A. athletes can receive scholarships totaling tens of thousands of dollars for tuition, room, board and stipends, as well as cost-of attendance compensation. But the association still sets a ceiling on those benefits, and a group of Division I basketball and football players is awaiting Judge Wilken’s ruling on whether that ceiling should effectively be lifted.
No, she won’t. She has already found that FBS in football and D-I in basketball are in violation of the federal antitrust laws, and she will determine whether there is a pro-competitive reason not to pay the players, and if so, whether there is a less restrictive alternative. Nobody will be requiredto pay the players, if Judge Wilken prevents the NCAA and its members from continuing to conspire to set the value of football and basketball labor at zero dollars. This is a very serious felony, by the way. And they’re college athletes, not “student-athletes,” which is a derogatory term.
As far as prior O’Bannon v. NCAA case, Judge Wilken required the NCAA and its members to stop conspiring to set the value of grants-in-aid below the actual cost of attendance. There is no ceiling whatsoever. There is also no such thing as an athletic scholarship. In the P5, the marginal value of these grants-in-aid approach zero, yet the NCAA and its members always want to quote retail, which is not what these largely impoverished group of young men would have to pay, were they to pay out-of-pocket. Also, this was a court order resulting from a finding of a violation of the federal antitrust laws, it was not “pressure,” which implies that compliance was optional.
The NCAA just cannot bring itself to admit that it violates federal antitrust laws, even though it has been found to have violated them before on multiple occasions, and even though it will be found again to be in violation of these laws, yet nobody has yet been sent to jail for a very serious felony.
If the plaintiffs in this case are successful, the arms race for top athletes may have no limit. The top 25 or so schools will pay because they can afford to. The remaining 325 or so will be forced to make a decision: not pay their athletes (and risk losing top talent to schools that do) or find a way to pay.
Here we get a false choice, as if its 25 versus 325 D-I universities, when the 65 P5 universities compete mightily with each other, but not with the 64 G5 universities, which combine to equal the FBS. The 125 FCS universities are not even part of the lawsuit in football. In men’s basketball, replacing FBS is the remaining 222 D-I universities, but the same competitive observation holds true. Most of the money is in the P5, those universities can afford to compete for talent, and much of that money will come off the over-paid coaches’ salaries.
We have already had a preview of what happens when schools are put in this position. In August 2015, after the N.C.A.A. began allowing Division I universities to adopt “cost of attendance” stipends, North Dakota State University announced that it would offer such stipends in 16 sports, resulting in a new $600,000 annual expense to be paid by the athletic department. The school’s rival, the University of North Dakota, followed suit six days later. What happened? The University of North Dakota cut five teams over the next two years to help pay for the added expense.
This is more nonsense. These non-FBS universities were only prohibited from capping their cost of attendance grants-in-aid in basketball, but these schools chose to offer them in more sports, and then UND chose to rearrange how many sports it fielded, which is a business decision made by universities every day, no different than which and how many classes will be taught in any given department. Is the choice really, if you pay young black men in P5 football and men’s basketball, UND loses sports? Again, pure propaganda.
The University of Wyoming, too, announced that it would offer stipends to its student-athletes in 2015, resulting in a new expected annual cost of $700,000 to the athletic department. A year later, calls were being made for a reduction in the athletic department because of budgetary concerns. (Those cuts almost certainly would have been made, had it not been for a $4 million subsidy from the state government.)
Again, what is the message? All universities have budgets and choices. It’s called the real world. Is the choice really, if you pay young black men in P5 football and men’s basketball, all other universities will threaten to cut their athletic budgets?
Gene Smith, the athletic director at Ohio State University, has said that if the N.C.A.A. pay ceiling were lifted and he were pushed to pay basketball and football student-athletes more than their full-ride scholarship packages, he would not expect to maintain the same number of sports. The chancellor at the University of Wisconsin, Rebecca Blank, has also said that her school would consider cutting sports programs altogether.
So what? This is just scare tactics typical of the antitrust violator called the NCAA. Even if they did, how is that not a reason to pay the black labor in football and men’s basketball? Ohio State already offers more sports than the 24 NCAA sports. Any chancellor who cancelled sports in Wisconsin would be tarred and feathered. I mean, really, totally fake and insincere threats are not excuses to steal the money from the labor.
Forcing the N.C.A.A. to pay student-athletes would undermine opportunities for the vast majority of them. It would create a winner-take-all system in which only a handful of top recruits would get a paycheck on top of earning a diploma debt-free.
More propaganda. Nobody will be forced to do anything besides stopping their collusion to set prices for labor at zero. The P5 is not a winner take all design, and paying their players would not impact that one bit. There are 5,525 P5 football grant-in-aid players, who would likely would be paid, and there are 845 men’s basketball GiA players, who would likely be paid, as well. More than half are black, which is far more than just a handful of young men, many of whom are not graduated.
Similar problems would arise in the case of so-called third-party payments, in which student-athletes could be paid for things like endorsements. Major brands like Nike would pay top football and basketball talent at the biggest schools, while student-athletes in other sports or at smaller programs would be ignored. Currently, corporate funds go to athletic departments and are generally distributed among all sports; with third-party payments, those funds could instead mostly go directly to a few student-athletes, starving the rest.
This is so silly. First, what “similar” problem? Louisville’s Adidas contract went primarily to its coach, and this is a common practice. Second, if Nike would rather sponsor Zion than Duke, as if that would be the choice, why would it matter? Third, endorsement deals at non-P5 universities are largely irrelevant, so the P5 stars are going to take money off of the small schools’ plates? And the rest would “starve?” Just more propaganda. Now some of the coaches, who are currently taking that money …
I am not opposed to young athletes who decide they would prefer to be paid cash to play sports. For those who think that a free education is insufficient as compensation for playing sports, there are other options: The National Basketball Association’s developmental league, for instance, offers $125,000 contracts to top high-school talent. Such athletes can also pursue a career playing for other domestic or overseas professional leagues.
This student author was not good enough to go to a revenue men’s basketball school, so he was not financially exploited. Who the hell cares what he thinks about whether we should allow exploitation of others? He’s gunning to be a lawyer, yet he offers the false choice between accepting continued antitrust violations or going to the G League, which pays like Double-A baseball to most players, and which is not large enough to absorb many college players?
Millions of student-athletes devote their sweat, blood and tears to sports. Some play football and basketball; others swim, run cross-country, play soccer or compete as gymnasts. Only a fraction of them generate money for their schools. We must ensure that the N.C.A.A. is able to preserve its commitment to all of them.
Millions?!? The NCAA says there are more than 460,000 college athletes in 24 sports. Is this student author’s thesis that it’s okay to steal money from the small fraction that generate revenue and redistribute it to whom, exactly, as it’s not now going outside of the P5? Does he contend that the NCAA gives any meaningful support to any university beyond the 64 that participate in March Madness? More propaganda, that if we pay those that earn the money, all of college sports will sink. This is the BS that the NCAA has been pushing forever, and while the “sky is falling” has worked for decades, we are on the precipice of change, with the question being, will it be slow or fast?
How to Think About the NFL’s Settlement with Kaepernick & Reid?
Richard G. Johnson*
Any political movement requires goals, leadership, money, organization, public relations, and so many other moving parts. A political protest does not—it just requires enough “self-immolation” that the power structure is embarrassed enough to change whatever.
When CK decided to kneel on the job during the national anthem, where he was paid eight-figures at the time, nobody seemed to understand how self-destructive this was to himself for a variety of reasons, including the following ones:
First, there’s no constitutional right to free speech in a private employer context absent those rights bargained for in the collective bargaining agreement, and no such rights were contained therein. Nobody else has such rights on the job, so it’s somewhat elitist to think that he should, which implies that somehow he has special status that will give greater impact and meaning to the protest. Certainly, there were thousands of avenues for him to engage politically off-the-job, but those aren’t nationally televised.
Second, the message was hardly targeted: When you have to explain that kneeling during the national anthem relates to police misconduct towards minorities, the obvious connection is missing. People associate the national anthem with good things, not bad things. Try standing in church, when you’re supposed to kneel, and see how far that protest goes. There are categories of decorum that are not breached, and most people believe that the national anthem is one of them.
Third, the act was designed to be offensive to the large number of people who paid to attend the games, and people do not like to pay to be offended, instead, they pay for the converse. The idea that this is a player forum is simply untrue. Instead, it was a player high jacking. There are only eight regular season home games, that for a family of four costs on average about $500, which is a huge expense for a middle-class family, and you can’t simply get up and walk out and get a refund like you can at a movie. Forcing people to be held hostage on their dime to your politics, right, wrong, or indifferent, still makes them hostages of sorts, and nobody likes that.
Fourth, CK wasn’t a victim, he opted-out of a lucrative contract, and he knew or should have known that no rationale employer would hire a labor organizer, who advocates to continue to organize labor in ways that are not generally accepted. No collusion was necessary to predict that nobody would ever hire him again. Life isn’t fair, and he didn’t have a right to be hired by anyone for anything, absent collusion to exclude him, and then only because collusion is prohibited by the CBA, or absent violation of the discrimination laws. Making a protest necessarily involves sacrifice, so either he intended the result he got, or he didn’t really intend to protest, when you can’t have it both ways.
Fifth, was CK an ineffective and self-interested leader or was he betrayed by the Player’s Coalition, when it “sold out” to the NFL? One could view it both ways.
Sixth, the NFL is seventy percent black players with viewership that is mostly white. These players have a limited shelf life, and they are lucky to play long enough just to vest in the pension. They don’t have many lucrative options after their generally short playing years are over. Of maybe twelve hundred black players, maybe one percent were active in the PC. That’s like twelve players. That’s not a political movement, yet they have been able to work with the NFL to make some progress. Is that a sin or a reality check?
Seventh, black NFL players do not as a class view it as their job to fix society or solve racial problems, instead, most of them are trying to make sure that they never have to go back to the lives of poverty in which many of them grew up. When the so-called football protests were going on, they were short-lived, and they generally were not supported by groups that should have, like Black Lives Matter, the NAACP, and so on. Instead, the ACLU was most active in supporting them, and it cared because of the free speech angle, not because of racial justice. The reality is that there was no national support for the black players protesting during the games—had they protested separate from the games, they may have built a large following quickly, but that would have required hard work.
Eighth, the settlement tells us nothing about the relative weight of what evidence would have been presented, and the fact that both sides agreed to confidentiality probably indicates that it was a settlement that made nobody happy, but that was one that the parties could live with. That’s kind of the definition of a perfect settlement. CK didn’t sell out at any price, instead, he had no national organized support, he separated himself from the players’ union, because of its perceived alliance with the NFL, and he battled this himself. Whatever he did on his own without any concrete assistance from anybody else is exactly what he should have done. Certainly, if he had won, nobody expected him to donate his proceeds to the undefined movement? This was about him, not us, however us is defined. Settle or not settle, that was about him and nobody else.
Ninth, what we’re left to ponder is, if athletes have a “podium” to speak out, which athletes are we talking about, because most don’t. The veteran stars signed to long-term and lucrative deals do, but then what is their interest to take on the world and upset their endorsement deals? This idea that athletes are somehow empowered to protest is as far from the truth as possible: Most of them have worked their entire lives to get to a position where they can “make it,” and they’re generally not giving that up for a cause. The relative risk to them versus the average person to protest places outsized risk on them, when the popular motif is that they have some sort of platform, because the press wants to interview them on a regular basis about their performance and generally nothing else. Sports writers are generally not out to change the world either, if you haven’t noticed, with the exceptions being some national columnists of stature.
I have been a grand jury foreman in Cleveland during times of police misconduct. I have inspected the county jail in that capacity and called attention to problems well before they became publically recognized problems. I am involved in the ongoing Policing project of the American Law Institute. I care greatly about the institutional racism inherent in Power Five Conference football and men’s basketball, and I write on that topic and speak to college and graduate school programs regularly. Notwithstanding all of that, I do not know what it is to be black, and I do not suffer the daily slights and loss of self-esteem.
I recognize that not only does the conversation about race need to change, the understanding that racism is premised on who gets the money and power needs to come to the forefront. And I know that there are a lot of people working on a variety of fronts, usually with little or no benefit to themselves, to try to move public opinion. Those without, because of a hundred years of Jim Crow rightly say, when do we get ours? And whites who are still fleeing integration through charter, parochial, and private schools, after fleeing the neighborhoods, those whites generally do not consider themselves to be racists. Blacks know very well who’s still getting the short end of the stick.
At the end of the day, in my view, CK has been a hindrance, not a furtherance, of the discussion about race. Whether he’s a good guy or a bad guy, out for everyone or out for himself, I do not know, but objectively, he has not been productive in forming or moving public opinion forward on racial issues. Instead, he has been polarizing, and become a foil to DJT. As much as he and ER deride the PC, it at least has something to show for itself, albeit by partnering with the so-called enemy NFL. What exactly does CK have to show for his efforts which may or may not be sacrifices? I would submit, not much, if anything at all, which like all failed protests are missed opportunities to get a message across. Instead, he’s become a corporate brand more than anything else, which is its own unique form of success.
The arrogance of federal court judges is something else, and in Alston v. NCAA, Senior District Court Judge Claudia Wilken is such an expert from O’Bannon v. NCAA that she decided to try this case mostly on the papers rather than live, which is presumptuous and unprofessional, in my opinion.
In The Derogatory Term “Student-Athlete,” I explained why this propaganda term should be stricken from the lexicon, so the plaintiffs only used the term twenty-two times in their two closing briefs, and then only as part of case names or as contained in quotations. That’s some progress, but the defendants continued to use it 191 times in theirs, yet the plaintiffs never called them on this manipulative behavior, so progress measured in millimeters. However, since the Judge used this term some 258 times in her O’Bannon opinion, this was a missed opportunity to advocate an important theme and move the story line of the case.
If one reads all of the above, one will quickly come to the conclusion that we are in the land of unwilling suspension of disbelief, which means that fancy lawyers and a fancy Judge are telling themselves and us a story that is wholly unbelievable and untrue, and I for one have no patience for this harmful fiction that ignores reality.
To over-simplify, Judge Wilken has already found a violation of the federal antitrust laws, and she is now immersed in an academic calculus called the Rule of Reason, where she determines if there are pro-competitive justifications for the illegal conduct, and if so, if there are less restrictive ways to achieve that goal.
The plaintiffs argue that there is no pro-competitive rationale for not paying the players, but if there is, then the Judge should allow the conferences—NCAA members themselves—to become mini-antitrust violators, but enjoined from conspiring with each other, which they say is a less restrictive alternative. They also argue the Judge should balance the value of the alleged pro-competitiveness against the harm caused, if they fail to prove a less restrictive alternative.
The defendants argue that their product is not paying the players, so that they’re “amateurs,” which allows them to “integrate” into the student body, and is thus pro-competitive, and that if the players are paid, their “product” will self-immolate due to lack of viewership. They also argue that the plaintiffs have not put a price on the pros and cons, so that there is nothing for the Judge to balance, and that she must therefore choose for them, if she does not find a less restrictive alternative. Like Mr. Spock, the defendants point out that if the product is defined by a lack of pay, then any pay destroys the product, so that there is no possible less restrictive alternative. The NCAA has successfully sold this line for about half a century.
Looking only at P5 football and men’s basketball is a gift from God, because that’s where the majority of the money is, that’s where the majority of the teams are black, and that’s where a majority of those blacks do not graduate. From this view, what we are left with is a broken balloon of the NCAA’s fluffy propaganda. This case is about not paying the black labor that the sixty-five P5 universities largely don’t educate. Justify that, Judge Wilken, and you are a racist.
The big lie about the “product”: The majority viewer whites won’t watch the broadcasts, if the black labor is paid, well, if you stop the price fixing, the universities still won’t pay them, if their viewership would get cancelled, right? But that won’t happen, and everyone knows it. The so-called product is a self-defeating sham, because if it’s true, you don’t need a rule to enforce it. Kind of Econ 101 for kindergarteners.
The token lie about “integration”: When you look at the abysmal black graduation rates in P5 FB and MBB, well, can you really say with a straight face that this is about “integration?” Especially when the black male student body is only 2.4% in the P5, but P5 FB is 55% black and MBB is 56% black. The 65 P5 universities are largely segregated, not integrated, as far as the black labor is concerned. Fact. Cold, hard, nasty, and very real fact. Shameful, too. Go back and reread my piece, Why Are We Tip-Toeing Around Racism in Alston v. NCAA?, and ask yourself, why are we, indeed? Then consider that in the closing arguments, race and racism are not even mentioned by the white lawyers to the white Judge in a trial with mostly white witnesses. Tip-toeing they are, hoping that none of us will notice.
The bottom line lie: Nobody besides me, and I mean nobody, has pointed out that on these major university campuses, we’re supposedly trying to integrate 85 footballers and 13 basketballers, for a total 98 players. Nobody has said, does the sky really fall on any given campus, if we pay 98 guys? The silliness of it is self-evident. The effect on where that money comes from, the inflated coaches’ and staff’s salaries, explains the vehement opposition. So does racism.
If you care, write Judge Wilken and tell her straight up that any decision that does not recognize the realities that apparently everyone wants to ignore is not okay, and tell her that you expect her to be and do better than she did in O’Bannon, where she countenanced the theft of players’ NILs, as I explained in my amicus brief to the Ninth Circuit to no avail.
Baseball historian (and paralegal) Richard Hershberger for the fall 2018 issue of SABR's Baseball Research Journal argues that the infield fly rule developed from the difficulty of defining and determining when an infielder had caught the ball. He traces the 20-year evolution of the definition of catch, including the development and use of a "momentarily held" standard for only infield-fly situations (the batter is out if the infielder "momentarily held" the batted ball). This marked an "expansion" of when the batter is out, removing for baserunners, umpires, and infielders confusion over when the ball was caught and thus over whether they were forced to run. The ultimate Infield Fly Rule took this to its logical conclusion, but rendering the batter out no matter if, how, or how long the infielder touched the ball.
I am sorry this paper was not out while I was writing the book; I would have enjoyed discussing and responding to it in the book.
I am thrilled to announce that Infield Fly Rule is in Effect: The History and Strategy of Baseball's Most (In)Famous Rule has been published by McFarland Press. This brings together all the writing I have been doing on the subject since 2012, in multiple law review articles and on this blog, including a full eight seasons of an empirical study of the rule's invocation. Makes a great gift for the baseball fan in your life. And there are four more days of Channukah and three weeks until Christmas.
I think his First Amendment claim is a good one, if he can get past the state action problems. I remain surprised it took him this long to find counsel, but I am glad he found someone. This could get interesting.
A week ago, on October 24, 2018, James Gatto, Merl Code, and Christian Dawkins were convicted of conspiracy to commit wire fraud related to the University of Kansas, the University of Louisville, the University of Miami, and North Carolina State University, all of which are members of the Atlantic Coast Conference except for Kansas, which is a member of the Big 12 Conference, which themselves are two of the so-called Power Five Conferences. All three defendants were also convicted of wire fraud against Louisville, but only Gatto was convicted of wire fraud against Kansas. There were no wire fraud charges related to Miami or North Carolina State.
In a press release issued that same day from the Deputy U.S. Attorney for the Southern District of New York, Robert S. Khuzami, he said:
Today’s convictions expose an underground culture of illicit payments, deception andcorruption in world of college basketball. These defendants now stand convicted of not simply floutingthe rules but breaking the law for their own personal gain. As a jury has now found, the defendants notonly deceived universities into issuing scholarships under false pretenses, they deprived the universitiesof their economic rights and tarnished an ideal which makes college sports a beloved tradition by so many fans all over the world.
What Mr. Khuzami meant by “tarnish[ing] an ideal which makes college sports a beloved tradition by so many fans all over the world” is unknown. For instance, didn’t Louisville do that already, when it had to forfeit the national championship due to its basketball coaches paying for prostitutes for its players and potential recruits?
In that press release, Mr. Khuzami gave an overview of the trial:
As found by the jury, Gatto, Code, and Dawkins brokered and facilitated the payments funded by Adidas to the families of high school and college aged basketball players in connection with decisions by those players to commit to Adidas-sponsored schools and a promise that the players also would retain the services of Dawkins and sign lucrative endorsement deals with Adidas upon turning professional. The payments, which the defendants took great lengths to conceal from the victim-universities, served to defraud the relevant universities in several ways.
First, because the illicit payments to the families of student-athletes rendered those student-athletes ineligible to participate in collegiate athletics, scheme participants conspired to conceal these payments from the universities, thereby causing them to provide or agree to provide athletic-based scholarships and financial aid under false and fraudulent pretenses. Indeed, the defendants and their co-conspirators, who included the families of the student-athletes and, in certain instances, one or more corrupt coaches at the universities, knew that, for the scheme to succeed and the athletic scholarships to be awarded, the illicit payments had to be concealed from the universities, and that certifications, falsely representing that the student-athletes were eligible to compete in Division I athletics, would be submitted to the universities.
Second, the scheme participants further defrauded the universities by depriving the universities of significant and necessary information regarding the non-compliance with NCAA rules by the relevant student-athletes and their families, and, in some cases, by certain corrupt coaches involved in the scheme. In doing so, the scheme participants interfered with the universities’ ability to control their assets and created a risk of tangible economic harm to the universities, including, among other things, decision-making about the distribution of their limited athletic scholarships; the possible disgorgement of certain profit-sharing by the NCAA; monetary fines; restrictions on athlete recruitment and the distribution of athletic scholarships; and the potential ineligibility of the universities’ basketball teams to compete in NCAA programs generally, and the ineligibility of certain student-athletes in particular.
That was the prosecution’s case, which should have been dismissed on the defendants’ motion for acquittal, but it wasn’t, and now the sentencing of these three men is set for March of 2019.
A. An Unusual Legal Theory & Manipulating the Storyline—
The charges at the core of these cases are based on an unusual legal theory that casts universities—who stood to benefit from recruits playing for wildly profitable basketball teams—as victims of fraud. What prosecutors call bribes, legal experts note, would be considered signing bonuses and referral fees in other industries. The payments are illicit only because the NCAA prohibits amateur athletes from making money from their talents and bars coaches from facilitating, and profiting from, meetings between agents and athletes.
“If you take away the NCAA rules, there’s no criminal case here,” said Randall Eliason, a former federal prosecutor and law professor at George Washington University. “There are some legitimate questions about whether this was a wise use of resources.”
The prosecution’s theory of the case has raised eyebrows in legal circles. Gatto, Code and Dawkins defrauded [the universities], prosecutors argue, by conspiring to pay families of top recruits to ensure they attended the schools, despite knowing this would break NCAA rules. Their scheme “created a risk of tangible economic harm,” the indictment states, because if these payments came to light, the NCAA could have penalized [the universities], potentially depriving the schools of revenue disbursements from the lucrative men’s basketball tournament.
Perhaps the most notable criticism of this theory has come from Eliason, former assistant U.S. attorney in D.C. who specialized in white collar crime and ran his district’s public corruption unit for two years.
The typical fraud case, Eliason explained in a phone interview, includes a few hallmarks: an intent to harm the victim, deception and a benefit at the victim’s expense.
“Those are all absent here. These guys didn’t want to harm the universities; they wanted to help them … and according to the prosecutors, they were working with top representatives of these universities’ basketball programs,” Eliason said. “How can you say the university was deceived?”
Much of life is how you tell the story, and here the prosecutors manipulated the storyline with the approval of the trial judge, so that the jurors got anything but a clear view of how elite college basketball actually works.
There was only one person getting rich off of Adidas money in this so-called scheme, and it was Coach Rick Pitino, yet he has not been indicted? Not surprisingly, none of this made it to Mr. Khuzami’s press release, because it doesn’t fit the storyline. The jury didn’t hear it, because no reasonable jury would have convicted the small fry, while letting the whale get away with all of the money.
B. Such a Prosecution Has Only Happened Once Before—
This is only the second time that a federal fraud case has been brought due to payment of money that ostensibly destroyed a college athlete’s eligibility.
The first time was in the 1980s, when Norby Walters signed up college players to future-dated agent contracts with the intent that he would represent the players, when they went pro. Walters gave them money and cars to induce them to sign with him, while they were still in college, thus making them ineligible from the NCAA’s point of view. Walters was indicted and eventually entered an Alford guilty plea to mail fraud, which was reversed on appeal in 1993. The reasoning was that the NCAA’s student-athlete forms were not integral to the alleged fraud, Walters had not caused the mailing of such forms, and that the payment by the universities of grants-in-aid to ineligible college athletes did not amount to Walters obtaining of any of the universities’ property.
First, Judge Easterbrook pointed out the obvious, which is that “[f]orms verifying eligibility do not help the plan succeed; instead they create a risk that it will be discovered if a student should tell the truth. And it is the forms, not their mailing to the Big Ten, that pose the risk.”
As an aside, nowadays a potential college athlete sets-up an account with the NCAA Eligibility Center, which determines the athlete’s initial eligibility, before setting up an optional account with the Collegiate Commissioners Association in order to sign a National Letter of Intent, if one is intended. After matriculation, but prior to engaging in intercollegiate athletics, the university will request the athlete to sign a NCAA Student-Athlete Statement, which now has six parts, some of which relate to eligibility, but another of which purports to require the athlete to waive his federal educational privacy rights in order to play intercollegiate athletics, which is illegal to require, yet the NCAA and the universities do.
By the time this form is signed, the athlete has already obtained his grant-in-aid for the year, and the athlete is already a freshman student. This form plays no part in the athlete actually receiving a grant-in-aid, but the failure to sign one, when asked, may result in the revocation of that grant. There is no criminal statute that requires an athlete to honestly complete this form, and there is no criminal penalty for dishonestly completing this form. This form does not purport to have anything to do with a grant-in-aid, and that term is not mentioned in the form in any fashion.
Second, Judge Easterbrook eviscerated the government’s idea that Walters need not have gained from the fraud, which is at issue in this case, too:
According to the United States, neither an actual nor a potential transfer of property from the victim to the defendant is essential. It is enough that the victim lose; what (if anything) the schemer hopes to gain plays no role in the definition of the offense. We asked the prosecutor at oral argument whether on this rationale practical jokes violate [18 U.S.C.] § 1341. A mails B an invitation to a surprise party for their mutual friend C. B drives his car to the place named in the invitation. But there is no party; the address is a vacant lot; B is the butt of a joke. The invitation came by post; the cost of gasoline means that B is out of pocket. The prosecutor said that this indeed violates § 1341, but that his office pledges to use prosecutorial discretion wisely. Many people will find this position unnerving (what if the prosecutor’s policy changes, or A is politically unpopular and the prosecutor is looking for a way to nail him?). Others, who obey the law out of a sense of civic obligation rather than the fear of sanctions, will alter their conduct no matter what policy the prosecutor follows. Either way, the idea that practical jokes are federal felonies would make a joke of the Supreme Court’s assurance that § 1341 does not cover the waterfront of deceit.
As another aside, the reality is that people cheat all of the time in their daily lives, where those cheats could be shoved into a federal mail or wire fraud charge, yet we all recognize the silliness of this. We may despise the cheater, but that does not mean that we make a criminal of him for every “waterfront of deceit.” The requirement that federal fraud benefit the defendant is the line in the sand, where we can clearly measure if the deceit was for his benefit, and if so, for how much?
Third, Judge Easterbrook took on the politics that are involved, when the NCAA is concerned, which are equally true today, a quarter century later (internal citations omitted):
Practical jokes rarely come to the attention of federal prosecutors, but large organizations are more successful in gaining the attention of public officials. In this case the mail fraud statute has been invoked to shore up the rules of an influential private association. Consider a parallel: an association of manufacturers of plumbing fixtures adopts a rule providing that its members will not sell “seconds” (that is, blemished articles) to the public. The association proclaims that this rule protects consumers from shoddy goods. To remain in good standing, a member must report its sales monthly. These reports flow in by mail. One member begins to sell “seconds” but reports that it is not doing so. These sales take business a way from other members of the association, who lose profits as a result. So we have mail, misrepresentation, and the loss of property, but the liar does not get any of the property the other firms lose. Has anyone committed a federal crime? The answer is yes—but the statute is the Sherman [Antitrust] Act, 15 U.S.C. § 1, and the perpetrators are the firms that adopted the “no seconds” rule. The trade association we have described is a cartel, which the firm selling “seconds” was undermining. Cheaters depress the price, causing the monopolist to lose money. Typically they go to great lengths to disguise their activities, the better to increase their own sales and avoid retaliation. The prosecutor’s position in our case would make criminals of the cheaters, would use § 1341 to shore up cartels.
Fanciful? Not at all. Many scholars understand the NCAA as a cartel, having power in the market for athletes. The NCAA depresses athletes’ income—restricting payments to the value of tuition, room, and board, while receiving services of substantially greater worth. The NCAA treats this as desirable preservation of amateur sports; a more jaundiced eye would see it as the use of monopsony power to obtain athletes’ services for less than the competitive market price. Walters then is cast in the role of a cheater, increasing the payments to the student athletes. Like other cheaters, Walters found it convenient to hide his activities. If, as the prosecutor believes, his repertory included extortion, he has used methods that the law denies to persons fighting cartels, but for the moment we are concerned only with the deceit that caused the universities to pay stipends to “professional” athletes. For current purposes it matters not whether the NCAA actually monopsonizes the market for players; the point of this discussion is that the prosecutor’s theory makes criminals of those who consciously cheat on the rules of a private organization, even if that organization is a cartel. We pursue this point because any theory that makes criminals of cheaters raises a red flag.
Cheaters are not self-conscious champions of the public weal. They are in it for profit, as rapacious and mendacious as those who hope to collect monopoly rents. Maybe more; often members of cartels believe that monopoly serves the public interest, and they take their stand on the platform of business ethics, while cheaters’ glasses have been washed with cynical acid. Only Adam Smith’s invisible hand turns their self-seeking activities to public benefit. It is cause for regret if prosecutors, assuming that persons with low regard for honesty must be villains, use the criminal laws to suppress the competitive process that undermines cartels. Of course federal laws have been used to enforce cartels before; the Federal Maritime Commission is a cartel enforcement device. Inconsistent federal laws also occur; the United States both subsidizes tobacco growers and discourages people from smoking. So if the United States simultaneously forbids cartels and forbids undermining cartels by cheating, we shall shrug our shoulders and enforce both laws, condemning practical jokes along the way. But what is it about § 1341 that labels as a crime all deceit that inflicts any loss on anyone? Firms often try to fool their competitors, surprising them with new products that enrich their treasuries at their rivals’ expense. Is this mail fraud because large organizations inevitably use the mail? “[A]ny scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises” reads like a description of schemes to get money or property by fraud rather than methods of doing business that incidentally cause losses.
“It is [indeed] cause for regret if prosecutors, assuming that persons with low regard for honesty must be villains, use the criminal laws to suppress the competitive process that undermines cartels.” Boy is it! Ditto when they criminalize private association bylaws. The ramifications of this are frightening. Needless to say, the NCAA is jumping for joy. But would it be, if the prosecutors were pursuing the NCAA and the universities for felony antitrust violations, where the NCAA and each university could be fined up to $100,000,000, and where their culpable executives could be imprisoned for up to ten years? That’s what should be happening.
C. What Conduct Wasn’t Charged—
As just mentioned, the NCAA and the universities were not charged with felony violations of the antitrust statutes, when in the pending Alston v. NCAA case, they have already been found to be in violation of those laws—so why not, when it would seem like a lay-up for the prosecutors?
If the prosecutors thought that Gatto was stealing from Adidas, then they would have charged him with fraud, wire fraud, theft, etc., of funds from his employer, yet they didn’t? Why not? As an executive of Adidas, did the prosecutors simply assume that this was authorized conduct? If so, why wasn’t Adidas, itself, indicted? It’s either one or the other, but it cannot be neither!
Likewise, if the prosecutors thought that Code was money laundering or committing tax fraud, they would have charged him and his AAU team with such crimes, yet they didn’t? Why not?
To show how much the prosecutors simply didn’t understand about college sports, Dawkins’ conduct violated the versions of the Uniform Athlete Agent Act enacted in all four states at issue, yet those statutes aren’t mentioned in the final indictment. Dawkins’ conduct also violated the federal Sports Agent Responsibility and Trust Act, which should have preempted all of the charges against him, yet his lawyer never mentioned this to the judge, who would have then lacked subject matter jurisdiction over the SPARTA claims. If Congress had wanted to criminalize actions under SPARTA, it certainly could have done so, but it didn’t. So why didn’t Dawkins’ lawyer bring this to the court’s attention? Maybe he didn’t understand college sports either?
D. The Conduct Charged Wasn’t Illegal—
First, as a basic premise, the reader needs to understand that under federal and..
We are three games into the 2018 World Series, which features one Jewish player on each team for the second year in a row. The first two games, both Red Sox wins, were quiet on this front. Ian Kinsler started both games at second for the Red Sox and was a combined 1-for-7 with an RBI. Dodgers outfielder Joc Pederson did not start either game; he was one of the Dodgers' four top hitters, all left-handers, who did not start against lefty starters, although he entered both games late, going 0-for-3 combined.
Game Three, an 18-inning Dodger win and the longest game in World Series history, had the Great, the Good, and the Ugly for the Chosen People.
Sandy Koufax gave Dodger starter Walker Buehler a standing ovation as Buehler left the mound after pitching seven innings of two-hit shutout ball with nine strikeouts. Koufax is two months shy of 83 and looks as if he still could pitch.
The good: Pederson gave the Dodgers a 1-0 lead with a home run in the third. But for a blown save, that would have been the game-winning hit.
The ugly: Kinsler. Inserted as a pinch-runner in the 10th, Kinsler was almost picked-off first. He was called safe and the call upheld on replay review, although it was close. Kinsler then advanced to third on a single, but overslid third base and barely scrambled to get his foot back on the base before being tagged. He then was thrown out trying to score on a fly ball to center. The throw was off-line, up the third-base line. But Kinsler got such a slow break off third that he basically ran into the tag about fifteen feet before the plate. Then, with the Sox up 2-1 with two out in the bottom of the 13th, Kinsler's wild throw on a grounder up the middle allowed the tying run to score and the game to continue for five more innings and a 14th-inning stretch. Game Four in about nine hours.