Photo by Dave Adamson on Unsplash
Nicholas Eaton, Associate Member, University of Cincinnati Law Review
I. INTRODUCTION
EA Sports (EA) broke hearts across the country when it cancelled production of its NCAA Football video games in 2013. Kids could no longer create virtual players with ninety-nine out of one hundred in every attribute and rush for 4,000 yards in a season on their way to a fourth consecutive Heisman Trophy. Due to ongoing litigation concerning student-athletes’ lack of compensation for their names, images, and likenesses, EA decided to cease production.[1]
This article outlines the legal issues that surround NCAA Football’s possible return. Section II details (1) the history of NCAA Football video games; (2) the National Collegiate Athletic Association’s (NCAA) amateurism rules; (3) the lawsuits that spurred EA’s decision to cancel NCAA Football; and (4) recent developments regarding the compensation of NCAA student-athletes. Section III dispels the NCAA’s concerns with paying student-athletes and provides the ideal course of action for the eventual return of NCAA Football games.
II. BACKGROUND
A. EA’s NCAA Football
In 1993, EA brought college football to the world’s fingertips with Bill Walsh College Football.[2] However, without a NCAA license, the game did not feature any real teams or schools.[3] EA spent the next few years producing College Football USA before releasing the first edition of its flagship college football game.[4] In 1997, EA released NCAA Football 98, beginning a thirteen-year tradition of NCAA Football releases.[5]
NCAA Football games gave users the ability to control all facets of their favorite college football teams. Users could call plays, throw for touchdowns, recruit incoming freshman, and even generate fictional teams with custom rosters.[6] Each version of NCAA Football included new game modes and features,[7] as well as updated rosters to reflect real life players at NCAA universities.[8] The athletes in the game were given “the same numbers, skin color, and skills as their real-life counterparts.”[9]
The NCAA Football franchise was loved by many, generating $1.3 billion in sales within the United States alone.[10] Through EA’s licensing deal with the NCAA, schools would make anywhere from $7,500 to over $100,000 a year.[11] Schools were paid in tiers based on the previous year’s Associated Press (AP) rankings.[12] Meanwhile, the athletes on the field did not earn a dime.[13]
B. NCAA Amateurism Rules
The NCAA has enforced amateurism rules since 1948.[14] These rules require student-athletes to refrain from various types of conduct in order to maintain their amateur status. For example, student-athletes are prohibited from (1) receiving scholarships above the cost of attendance; (2) signing contracts with professional teams; and (3) hiring an agent.[15] Furthermore, and most importantly in the context of NCAA Football video games, NCAA amateurism rules prevent students from receiving payment for the use of their names, images, and likenesses.[16]
C. The Litigation that Ended NCAA Football Video Games
EA announced the cancellation of NCAA Football in 2013 amidst ongoing litigation with former athletes.[17] According to EA, “[t]he ongoing legal issues combined with increased questions surrounding schools and conferences [left them] in a difficult position – one that [challenged their] ability to deliver an authentic sports experience . . ..”[18] This announcement left developers and fans of the game massively disappointed.[19]
O’Bannon v. NCAA, which was briefly consolidated with Keller v. Electric Arts Inc., [20] ended the NCAA Football video game franchise.[21] O’Bannon and Keller were deconsolidated after the claims against EA were settled for $60 million.[22] In O’Bannon, the U.S. 9th Circuit Court of Appeals held that, in order to comply with antitrust law, the NCAA must allow student-athletes to receive scholarships up to the cost of attendance.[23] As the NCAA had already voted to allow cost of attendance scholarships in 2014,[24] the court did not require any changes to the NCAA’s amateurism rules.[25]
D. Recent Developments
On September 30, 2019, California pulled the rug out from under the NCAA with its Fair Pay to Play Act.[26] The law, which will come into effect in 2023, allows student athletes to hire agents and prevents the NCAA from punishing students for collecting compensation from their names, images, and likenesses.[27]
While the NCAA originally warned that the Fair Pay to Play Act could affect California schools’ eligibility for NCAA events,[28] it changed course in October of 2019.[29] Against the expectations of many, the NCAA announced it would begin constructing a system for its student athletes to be paid.[30]
California’s Fair Pay to Play Act, coupled with the NCAA’s October decision, has spurred legislation across the country.[31] Almost half of the states are working on similar pay-to-play bills.[32] This has caused a major problem for the NCAA.[33] If student-athlete compensation is regulated through state-by-state legislation, as opposed to a single federal act, “the NCAA risks facing an untenable legal landscape that would grant schools in some states major advantages in the recruiting process.”[34] As the NCAA lobbies for a federal bill, it hopes to protect the idea of amateurism by continuing to prevent players from receiving compensation linked to on-field performance.[35]
III. DISCUSSION
So how does NCAA Football, realistically, make a comeback? Clearly, the players are going to need to be paid. EA made it clear through its cancellation of NCAA Football that it is unwilling to accept the backlash of profiting off players’ names, images, and likenesses without providing compensation. In order for players to be paid, individual states or the federal government will need to devise a plan that works for both the NCAA and the players. Therefore, we are left with a tug of war scenario. The NCAA wants to protect amateurism, as it claims amateurism fuels the popularity of its product.[36] The players, on the other hand, would like to be fairly compensated for the use of their names, images, and likenesses.
Using the NCAA and EA’s former payment model as a starting point, two scenarios present themselves. First, schools could distribute the money from the EA licensing deal directly to the players. Second, schools could follow O’Bannon’s proposal and hold the money in trust until players graduate or leave school.[37]
A. Direct Compensation
The simplest way NCAA schools can compensate student-athletes for the use of their names, images, and likenesses is direct payment. As stated above, schools would receive anywhere from $7,500 to over $100,000 per year from EA’s licensing deal.[38] If the schools took a small cut, ten percent for example, the remainder could be divided equally amongst the players. This scheme would award each player on the 105-man roster approximately $950 if the team was given $100,000. If a team underperformed, players would pocket a measly $70.
This scheme would not be supported by the NCAA. In O’Bannon, the NCAA argued that amateurism is crucial to the popularity of college sports.[39] In a way, college football functions like a minor league organization. It provides players the opportunity to develop before making a jump to the NFL. However, college sports are far more popular than minor league sports. The NCAA claims that student-athletes lack of compensation for on-field performance is the differentiating factor.
B. Compensation in Trust
The NCAA’s opposition to direct payment gave rise to an interesting alternative: delaying payment through trust. In this scheme, recommended by O’Bannon in trial, licensing payments would be held in trust for players until they leave school.[40] Delaying payment, in theory, placates both parties. Players would receive the compensation they deserve, and the NCAA’s precious amateurism principles would be protected. While the NCAA opposed this idea, its expert witness agreed that payments of up to $5,000 per year in trust “would not have a significant impact on [consumer] demand.”[41]
C. Modest Compensation is not Likely to Impact the NCAA’s Product
The NCAA’s fear that compensating players would negatively impact college football’s consumer demand is unfounded. It claims that paying players would separate them from other students and transform college football into a minor league organization. This is irrational in light of the facts. From video game licensing alone, players would earn, at most, $1,000 per year. Even considering television licensing, which is admittedly much more lucrative, players would only receive a few thousand dollars a year. O’Bannon used $5,000 a year as an example figure.[42] This is not enough money to cause a noticeable impact on the lifestyles of student-athletes. As the NCAA only allows eighty-five scholarships per team, many players will use this money to pay tuition.[43] To say that a few thousand dollars a year would turn players into professional athletes is a vast overreaction.
Furthermore, the NCAA is unnecessarily concerned with forming a “social ‘wedge’ between student athletes and the rest of the student body,” as this is practically already the case.[44] College football players are highly recognized and admired figures on college campuses. At larger schools, certain players are national celebrities. It is naïve to believe that a social wedge does not already exist between athletes and the remainder of the student body.
Modest compensation for the use of players names, images, and likenesses is not likely to impact the NCAA’s product. The players may be able to afford a new PlayStation or buy a few more 4 for 4 meals from Wendy’s, but their lifestyle will not be noticeably different. For this reason, there is no need to hold players’ compensation in trust until they leave school. There is no reason for NCAA schools to jump through hoops in order to prevent minor lifestyle changes that will not affect the product on the field.
IV. CONCLUSION
As the NCAA, state legislatures, and the U.S. Congress hash out the details, NCAA Football fans must continue to patiently wait. However, there is hope for a return of the beloved game. If a practical plan is put in place to pay the student-athletes for the use of their names, images, and likenesses, EA could finally resume production. As the interested parties put this plan together, they should not be bogged down by irrational fears that college sports fandom will suddenly disappear. Fans will still fill college stadiums even if the players can spare $60 to buy NCAA Football 2024.
[1] Tony Manfred, EA Sports Cancels Its College Football Video Game Amid A Wave Of Lawsuits, Business Insider (Sep. 26, 2013, 4:34 PM), https://www.businessinsider.com/ea-sports-cancels-ncaa-football-videogame-2013-9.
[2]EA Sports, The History of NCAA Football, EA Sports (Nov. 27, 2013), https://www.ea.com/news/ncaa-football-history.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] Id.
[8] Manfred, supra note 1.
[9] Id.
[10] Roger Groves, EA Sports Will Still Score Even More Financial Touchdowns Without The NCAA, Forbes (Sep. 28, 2013, 10:47 AM), https://www.forbes.com/sites/rogergroves/2013/09/28/ea-sports-will-still-score-even-more-financial-touchdowns-without-the-ncaa/#4e415d0e554a.
[11] Chris Smith, NCAA Football Video Game Is Worth Over $75,000 Per Year For Top Teams, Forbes (Aug. 22, 2013, 10:47 AM), https://www.forbes.com/sites/chrissmith/2013/08/22/ncaa-football-video-game-is-worth-over-75000-per-year-for-top-teams/#1603e67826d4.
[12] Id.
[13] See O’Bannon v. NCAA, 802 F.3d 1049, 1055 (9th Cir. 2015).
[14] Id at 1054.
[15] Id at 1054-55.
[16] Id at 1055.
[17] Manfred, supra note 1.
[18] Id.
[19] Adam Kramer, The Cult of NCAA Football: How EA’s CFB Series Has Lived on Despite Cancellation, Bleacher Report (July 30, 2019), https://bleacherreport.com/articles/2847267-the-cult-of-ncaa-football-how-eas-cfb-series-has-lived-on-despite-cancellation.
[20] O’Bannon, 802 F.3d at 1055.
[21] Adam Kramer, supra note 19.
[22] O’Bannon, 802 F.3d at 1056; see also Jon Soloman, College athletes react on Twitter after receiving EA Sports lawsuit checks, CBS Sports (Apr. 12, 2016, 1:31 PM), https://www.cbssports.com/college-football/news/college-athletes-react-on-twitter-after-receiving-ea-sports-lawsuit-checks/.
[23] O’Bannon, 802 F.3d at 1079.
[24] Id at 1054-55.
[25] See id. See id at 1079.
[26] Jack Kelly, Newly Passed California Fair Pay To Play Act Will Allow Student Athletes To Receive Compensation, Forbes (Oct. 1, 2019, 12:36 PM), https://www.forbes.com/sites/jackkelly/2019/10/01/in-a-revolutionary-change-newly-passed-california-fair-pay-to-play-act-will-allow-student-athletes-to-receive-compensation/#ba381c157d02.
[27] Id.
[28] Joseph Zucker, California State Senate Passes ‘Fair Pay to Play’ Bill for College Sports, Bleacher Report (Sept. 11, 2019), https://bleacherreport.com/articles/2853401-california-state-senate-passes-fair-pay-to-play-bill-for-college-sports.
[29] Colin Dwyer, NCAA Plans To Allow College Athletes To Get Paid For Use Of Their Names, Images, NPR (Oct. 29, 2019, 2:59 PM), https://www.npr.org/2019/10/29/774439078/ncaa-starts-process-to-allow-compensation-for-college-athletes.
[30] Id.
[31] Thomas Barrabi, NCAA athlete pay debate: Why a political showdown is coming in 2020, Fox Business (Jan. 3, 2020), https://www.foxbusiness.com/sports/ncaa-athlete-pay-debate-2020-expert-predictions.
[32] Id.
[33] Id.
[34] Id.
[35] Id.
[36] Id.
[37] See O’Bannon v. NCAA, 7 F. Supp. 3d 955 (N.D. Cal. 2014).
[38] Smith, supra note 11.
[39]O’Bannon v. NCAA, 802 F.3d 1049, 1058 (9th Cir. 2015).
[40] Id. at 1080.
[41] Id.
[42] Id.
[43] Deborah Ziff Soriano, 4 Myths About Athletic Scholarships, US News (June 5, 2019, 9:08 AM), https://www.usnews.com/education/best-colleges/paying-for-college/articles/2017-10-04/4-myths-about-athletic-scholarships.
[44] O’Bannon, 802 F.3d at 1060.
