NCAA v. Board of Regents of Univ. of OklahomaUnited States Supreme Court, 468 U.S. 85 (1984)

Keywords: antitrust, Sherman Act, television rights, NCAA, trade market

FactsIn 1981, the NCAA adopted a plan for the televising of college football games of its member institutions for the 1982-1985 seasons. Only ABC and CBS could broadcast these games. No member of the NCAA was allowed to make any sale of rights, except in accordance with the plan. Respondents were Universities that were members of the NCAA as well as members of the College Football Association (CFA). The CFA consequently negotiated a deal with NBC that was more liberal and not in compliance with the original NCAA plan. The NCAA announced it would take action against any school that followed the CFA agreement, upon which the respondents filed action against the NCAA.

IssueDid the NCAA’s televised plan constitute an antitrust violation?

HoldingThe Court found that NCAA’s television plan violated the Sherman Antitrust Act. Under the Rule of Reason analysis, the Court is to “form a judgment about the competitive significance of the restraint.” The Court found that the restraint on the operation of a free market established that the plan was operated to raise price and reduce output, both of which are unresponsive to consumer preference. The Court noted that following the Rule of Reason, such a deviation from the operation of a free market places a heavier burden upon the NCAA to justify its plan. After considering the NCAA’s justifications for the restrictions, the Court determined all to be insufficient. The Court first rejected the argument that the plan was a joint venture and therefore was procompetitive, finding that NCAA football could be marketed just as effectively without the plan. Next, the Court rejected the argument that fan interest in a televised game may adversely affect ticket sales for games that will not appear on television. The Court relied on the District Courts studies and findings that indicated the plan simply does not protect live attendance by ensuring that games will not be shown on television at the same time as live events. Finally, the Court rejected the argument that the NCAA has a further interest in maintaining a competitive balance among amateur athletic teams. The Court found this justification for the television plan can not be tailored to serve such an interest. The Court said the plan does not regulate football program spending or revenue of all members; it simply imposes a restriction on one avenue of revenue that is more important to some members.

Summarized by: Matt Bower