OAKLAND -- As an unprecedented trial over the NCAA's control on college sports got underway Monday, the organization settled a separate lawsuit that for the first time pays money to tens of thousands of student-athletes beyond the scholarships they received for playing top-level college football and basketball.
The NCAA agreed to pay $20 million to resolve the case over claims the organization conspired with EA Sports to prevent football and basketball players from getting paid for use of their images in popular video games. EA had already agreed to pay $40 million to settle with as many as 100,000 former players and possibly some current student-athletes.
The settlement removed one legal fight for the NCAA, but former UCLA basketball star Ed O'Bannon pressed forward Monday with his trial, which has broader ramifications. That case seeks a court order from Chief U.S. District Judge Claudia Wilken that would strip the NCAA of its power to keep student-athletes from profiting from Division I football and basketball revenue, notably from the billions of dollars that flow into college sports from television revenue.
The lawsuit alleges that the NCAA is a cartel, violating federal antitrust laws through its rules against college athletes receiving any compensation beyond their scholarships. The NCAA argues that the central mission of college sports remains education, and that shifting the rules to pay student-athletes would damage the system.
O'Bannon, who led UCLA to a national championship in 1995, took the witness stand to emphasize that top-tier college athletes are on campus to play sports, not to get their education. While O'Bannon finished his degree from UCLA several years ago, he testified that he spent 40 hours a week on basketball during his days as a college player.
"I was an athlete masquerading as a student," O'Bannon, who later played for three NBA teams, told the judge.
Outside court, O'Bannon and his lawyer, Michael Hausfeld, stressed that the trial is meant to establish that football and basketball players should get a share of the huge amount of money flowing into colleges and universities from their sports. At one point in his testimony, O'Bannon said high school players whose games are on television, and even Little Leaguers who play in the ESPN broadcast Little League World Series, should be entitled to a cut, but backed off those statements outside the courthouse.
"Certain things need to be said, and we're here to say them," O'Bannon told reporters.
Hausfeld said the NCAA's settlement of the video game claims does not resolve any of the issues in the current trial.
The NCAA insisted that the settlement does not change its ban on student-athletes being paid for playing college sports, but any current players who receive money from the fund will be given a waiver that preserves their athletic eligibility. Depending on how many players file a claim in the class-action case, current and former players would be entitled to anywhere between a few hundred and a few thousand dollars from the settlement.
The settlement covers EA video games dating back to 2003, although the NCAA backed out of sponsoring the games last year as a result of the litigation.
Steve Berman, a lawyer for the former football and basketball players, including lead plaintiff Sam Keller, a former San Ramon Valley High School quarterback, said the settlement does establish a precedent for a student-athlete's right to be paid if others profit from their sport and could open the door to licensing with video game makers such as EA.
"This is the first time in the history of the NCAA that the organization is paying student-athletes for rights related to their play on the field," Berman said.
In his testimony Monday, O'Bannon recalled how he first discovered his likeness was being used in a college basketball video game, years after his UCLA playing days were over. The son of one of his golfing buddies put the game in, and O'Bannon concluded it was an avatar of him, including his left-handed shooting form. He told the judge that college athletes should be paid by companies that make money off those games.
The trial will resume Tuesday morning with further testimony from Roger Noll, a Stanford University economist who specializes in sports business issues. Noll, the players' chief expert witness, testified Monday that the NCAA's rules stifle competition and violate antitrust protections, harming student-athletes.
Tyrone Prothro, a former University of Alabama wide receiver, is expected to testify after Noll.
Howard Mintz covers legal affairs. Contact him at 408-286-0236 or follow him at Twitter.com/hmintz.