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Volume 22 No. 7

Labor and Agents

As the multiyear court challenge to overturn the NCAA’s ban on athlete compensation is nearing a decision, NCAA lawyers argued that what plaintiffs are seeking could wreak havoc on college sports, especially on the basketball championship.

 

“Numerous witnesses … testified that a move to pay-for-play would harm national championships and disrupt traditional rivalries in football and basketball,” the NCAA said in its written closing brief. “With respect to March Madness in particular, there was significant evidence that the value of that tournament, the principal source of revenues for the NCAA and many conferences, would be damaged if pay-for-play were allowed.”

 

The case was first brought by former college football players Martin Jenkins and Shawne Alston in 2014, and U.S. District Court Judge Claudia Wilken is set to hold what is expected to be the final court hearing in the case on Tuesday.

 

Since both sides have submitted written closing arguments, Wilken could, theoretically, rule on the case then, but more likely she will ask last-minute questions of lawyers for the athlete plaintiffs and NCAA and college conference defendants and issue a written decision later.

 

Judge Claudia Wilken once again sits at the center of a key decision in college sports.
Photo: Hillary Jones-Mixon / The Recorder

If the former players win, it could mean a sea change to college sports. The players are asking for an injunction in which the conferences could decide their own rules on whether college football and basketball players are paid and how much. The players also have offered an alternative injunction in which athletes can receive education-related benefits or expenses.

 

Wilken has already decided that NCAA rules violate antitrust laws. Wilken also ruled, however, that the NCAA can continue with the current caps on compensation on players if they are able to produce evidence of the “procompetitive effects” of the current system.

 

In a 10-day trial held in September, the NCAA and 11 college conference defendants argued against the student athletes’ proposed injunctions and put economists, university officials and conference commissioners, including Pac-12 Commissioner Larry Scott, on the stand as witnesses.

 

“Larry Scott … testified that ‘the very large majority of consumers value amateurism, think student athletes get a lot of support under the current system, and would not like to see them be paid or be professional,’” the NCAA said in its closing argument.

 

Scott also said a system where conferences decide compensation rules could widen the gap between the so-called “haves and have nots” and could undermine the “Cinderella stories” that are a key popularity factor of the NCAA basketball tournament, the NCAA said.

 

But in their closing argument papers, lawyers for the plaintiff former college players said that the NCAA provided a lot of opinions at trial but not a lot of evidence.

 

“Speculative lay opinions — based on untestable hearsay statements from anonymous college sports fans — do not constitute a substitute for credible economic evidence assessing the relationship between the restraints on Class Member compensation and consumer demand,” the players’ lawyers said. “The trial exposed the NCAA’s concept of ‘amateurism’ as sheer pretext, a chameleon-like principle that constantly changes colors with the whim of whatever the NCAA’s majority says it means.”

 

The players’ lawyers also argued that the NCAA already is allowing different kinds of outside compensation now with no adverse effects, including payments to Olympic athletes, signing bonuses paid to baseball players drafted by MLB clubs and money given to bowl game players in “gift suites,” among other things, according to court papers.

 

Colleges have paid more to student athletes in recent years, especially since 2014 when Wilken ruled in the O’Bannon versus NCAA case that schools must pay the full cost of attendance in college scholarships.

 

“Plaintiffs proved that every time the NCAA’s members have increased athlete compensation and thereby altered what they said it means to be an ‘amateur,’ there was no harm to consumer demand,” the players’ lawyers said in their documents.

 

It is not clear exactly when Wilken will issue her decision, but whatever side loses the case is expected to appeal it.

 

Liz Mullen can be reached at lmullen@sportsbusinessjournal.com. Follow her on Twitter @SBJLizMullen.

Rod Moskowitz

Motorsports agent Rod Moskowitz and soccer agent Mike Gartlan are merging their agencies with golf agent Jens Beck’s Pro Sport Management, as the trio are betting that the combined group will give them greater scale and influence.

 

Moskowitz has been principal and CEO of Fuel Sports Management Group based near Charlotte, while Gartlan has been president of Cor Sports Management based in Corona del Mar, Calif. Beck is based out of Scottsdale, Ariz.

 

The three executives will continue to work from the same locations, but they have all adopted the Pro Sport name.

 

Jens Beck

Collectively, they represent athletes including golfer Bubba Watson, NASCAR drivers Chase Elliott and Denny Hamlin, and soccer player Erik Palmer-Brown.

  

The three have been putting the deal together for around a year, but they just finalized it in recent months and are announcing the move via this report.

 

“First and foremost, creating a little bit of scale is great,” Beck said. “This is all about the clients, and especially on the sponsorship side, they get a bigger reach and we get a bigger reach: From being a small soccer agency, a small racing agency and a small golf agency, we become a medium-sized sports agency with a global reach — and that benefits our clients.”

 

Financial terms of the merger were not disclosed.

 

The combined staff will have about 25 people. Beck said that the three executives decided to go with the Pro Sport name because it “was the most generic name we had in the group and we don’t want it to be about the company and about us — this is about the clients and making a better setup for them.”

 

Beck and Moskowitz had already owned a substantial stake in Cor, which went through a merger of its own earlier this year when it combined with another soccer agency in Onfield Management.

 

Moskowitz, Gartlan and Beck envision leveraging varied connections in their respective sports to increase the capabilities Pro Sport can offer to its clients. The group regards soccer as the sport with the most growth potential, but will remain active in golf and racing as well.

 

“This only grows and strengthens our resources, which only creates more value for our client base,” said Moskowitz, who was a Sports Business Journal Forty Under 40 honoree in 2014. “We’re working with and targeting a high-performing, highly marketable, exclusive client roster, and we think this enables funding new business opportunities and getting better at sponsorship and social media. We’re good at those two areas already, but this makes us better at all of these very important aspects of serving talent.”