Courtroom takes compensation of athletes, class motion
Posted Wed, Dec 16th 2020 1:32 pm by Amy Howe
The judges on Wednesday added three new cases for a total of two hours of dispute to their list of cases scheduled for oral hearing during this term. The announcement that the judges would address key antitrust-related issues for the National Collegiate Athletic Association and class actions came just two days after the judges issued their second set of orders from their private conference on Dec. 11. The move was similar to a similar orders made at that time last year that allow judges to continue filling out their paperwork for the second half of the term without having to wait for their next regularly scheduled conference on Jan. 8.
The Supreme Court agreed to look into the controversial issue of college athletes’ compensation and approve the National Collegiate Athletic Association v Alston and the American Athletic Conference v Alston. Over 35 years ago, in the NCAA v Board of Regents case, the Supreme Court pointed out that the rules governing admission standards for college athletes are subject to a different and less rigorous analysis than most antitrust cases. Earlier this year, in a case filed by Division 1 soccer and basketball players, the U.S. Court of Appeals for the 9th Circuit ruled that the NCAA restricts the provision of educational benefits – such as computers, scientific equipment, postgraduate scholarships – and internships – in violation of federal antitrust laws .
The NCAA (along with 11 major sports conferences) came to the Supreme Court in October asking the judges to review that decision. The NCAA told judges that the 9th Circle decision “will fundamentally change the centuries-old institution of NCAA sport and blur the traditional line between college and professional athletes” if allowed.
The athletes urged the judges to stay out of the dispute, arguing that the NCAA and schools are really looking for antitrust immunity. Not only has Congress refused to provide such a protective shield, but it is currently considering whether to “remove” the limit on athletes’ compensation in order to recognize “the profound inequality of a system that conference leaders, sporting directors, coaches, schools, television stations and many others to make billions of dollars on the backs of young, often disadvantaged gamblers. “
The judges on Wednesday morning upheld the petitions filed by the NCAA and sports conferences and consolidated the two cases for an hour of hearing.
The Supreme Court also granted a petition from credit reporting giant TransUnion asking it to weigh up issues related to class action lawsuits and punitive damages. The TransUnion v Ramirez case emerged when Sergio Ramirez went to a Nissan dealership with his wife and father-in-law to buy a car. However, a credit report revealed that Ramirez’s name matched a name on the Treasury Department’s Office of Foreign Assets Control of people US corporations cannot do business with. Ramirez and his wife bought another car that day, but they only did it on their behalf. TransUnion eventually removed the OFAC warning from future credit reports that might be requested by or for Ramirez, but – out of caution – Ramirez canceled a planned trip to Mexico.
Ramirez then went to federal court alleging that TransUnion’s actions violated fair credit reporting law. The district court upheld the case as a class action lawsuit involving everyone who received a letter from TransUnion over a six-month period stating that their name was a “potential match” for someone on the OFAC list. Only a fraction of these class members had their credit reports sent to third parties.
The jury awarded each class member nearly $ 1,000 for violations of the FCRA and over $ 6,000 in punitive damages, bringing the overall verdict to more than $ 60 million. On appeal, the 9th Circuit upheld statutory damages but reduced punitive damages to around $ 32 million.
TransUnion came to the Supreme Court this fall and asked the judges to weigh two questions. The first is whether either the Constitution or the federal class action lawsuit rules move the case forward when most class members were not injured at all and any harm they suffered had nothing to do with Ramirez’s. The second is whether the punitive damages of $ 32 million was so high compared to the damages for violating the FCRA that it is against the Constitution. The judges agreed with the first question but declined to deal with the question of punitive damage.
The cases granted on Wednesday are expected to be discussed in the spring, with decisions to follow by the summer.
This post was originally published on Howe on the Court.
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SCOTUSblog (December 16, 2020, 1:32 p.m.), https://www.scotusblog.com/2020/12/court-to-take-on-student-athlete-compensation-class-action-cases/