The NCAA has long kept the details of its revenues generated from student-athletes a secret. That effort took a drastic hit on Monday, when a federal judge ruled that former NCAA basketball star Ed O'Bannon could proceed with his lawsuit against the NCAA.
O'Bannon's lawyers now will attempt to get access to NCAA's financial records related to student-athletes through the discovery process.
Discovery is a pre-trial phase in a lawsuit in which each party receives access to other parties' documents and evidence relevant to issues in the case. Because O'Bannon will likely seek a portion of revenues generated by the NCAA, he can use discovery to learn more about its financial affairs.
According to Jon King, one of O'Bannon's attorneys, "This is a truly historic day—to our knowledge, no one has ever gotten behind the scenes to examine how student-athlete's current and future rights in their images are divided up and sold."
King also remarked that "the court and public will be shocked at how crassly commercial the sale of all these items are. It's not a public service. It's purely to make money. In every other walk of life you enter, you have to share the proceeds."
The NCAA still has a few outs. It can file a request for a "protective order" so that certain evidence it produces through discovery does not leak to the public. A protective order must be granted by the judge to take effect. Alternatively, it can settle the case against O'Bannon and other lead plaintiffs in the class action.
O'Bannon is suing the NCAA because it still uses his and other former student-athletes' images in television broadcasts, video games, and other memorabilia.
He alleges that student-athletes are required to sign an agreement with the NCAA in order to participate in NCAA athletics. The agreement grants the NCAA rights to use the athlete's image and likeness to promote NCAA championships, events, or programs. O'Bannon claims that this and other NCAA practices constitute unreasonable restraints on trade in violation of antitrust law.
O'Bannon is lead plaintiff in the class action lawsuit on behalf of former student-athletes. He discovered that the NCAA was still generating revenue from his likeness after seeing a friend playing a video game featuring former NCAA basketball players, including himself.
While the game did not use O'Bannon's name, it used his distinctive image and likeness. "[I]t had my number, left-handed, it looked like me. It was everything but the name," noted O'Bannon.
O'Bannon filed the lawsuit on May 5th, 2009. Judge Claudia Wilken denied NCAA's motion to dismiss the case on Feb. 8th, 2010.
**S.N. Counsel focuses his journalism on sports law issues.