A federal judge ruled Friday that the NCAA violates U.S. antitrust law by preventing football and basketball players from being compensated for the use of their names, images and likenesses.
In a 99-page opinion, Chief District Judge Claudia Wilken wrote that the NCAA violates antitrust law "by agreeing with its member schools to restrain their ability to compensate Division I men's basketball and FBS football players any more than the current association rules allow."
The class-action lawsuit was filed five years ago by a group of plaintiffs led by former UCLA basketball player Ed O'Bannon. They sought changes to the NCAA rules prohibiting athletes from receiving a share of the revenue when their likenesses or names, etc., are used commercially, as in video games.
Wilken ruled the NCAA cannot prevent schools from offering recruits in FBS football and Division I basketball "a limited share of the revenues generated" in such cases.
- That the NCAA will be allowed to cap the amount of compensation an athlete can be awarded, as long as the cap is set at or above the cost of attendance.
- That the NCAA is prohibited from preventing schools or conferences from depositing shares of licensing revenue into trusts payable to athletes when they leave school or their eligibility expires.
- That the NCAA will be allowed to cap the amount of money held in those trusts as long as it's not below $5,000 for each year an athlete remains academically eligible to compete.
The injunction will not take effect until the start of the next FBS football and Division I basketball recruiting cycle.
Wilken's ruling follows several other potentially landscape-altering decisions this year over athletes' rights.
In June, the NCAA announced a settlement in a lawsuit filed by former football and basketball players led by former Arizona State quarterback Sam Keller for claims over college-themed video games produced by Electronic Arts.
And in March, the National Labor Relations Board ruled that Northwestern football players are employees of the university and therefore eligible to unionize if they vote to do so.