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Summer 1998
Volume 1, Issue 1
Martin v. PGA Tour, Inc.
Smith v. NCAA
Law v. NCAA
Todd v. Rush County Schools
Law v. National Collegiate Athletic Association,
134 F.3d 1010 (10th Cir. 1998)
JURY ORDERS NCAA TO PAY $67 MILLION IN DAMAGES FOR VIOLATION OF SHERMAN ANTITRUST
ACT AND CLAYTON ACT BY RESTRICTING THE EARNINGS OF COACHES.
On January 23, 1998, the 10th Circuit Court of Appeals upheld the
decision of Kansas District Court Judge Kathryn H. Vratil regarding NCAA Bylaw 11.02.3
which designated restricted earnings coaches. After finding that the bylaw had a clear
anticompetitive effect in restricting salaries, the Court then looked to the NCAA's
justifications for the bylaw (retention of entry-level positions, cost reduction, and
maintaining competitiveness) finding that all were invalid.
In a further decision related to this case, on Monday, May 4, 1998, a
federal jury in Kansas City ordered the NCAA to pay nearly $22.3 million in damages as a
result of this lawsuit. The penalty assessed includes back pay and court costs for 1,900
assistant coaches who had argued that their earnings had been improperly limited to a
$12-$16,000.00 level beginning in 1992. The jury awarded damages of $ $11.2 million to
men's basketball coaches, $1.6 million for baseball coaches, and $9.5 million for
coaches of other sports. Therefore, as a result of the treble damages set for violations
of the Sherman Act under § 4 of the Clayton Act, the NCAA is potentially liable for
approximately $67 million.
Almost immediately, NCAA attorneys stated that they would appeal this
award. NCAA officials fear that member schools would be forced to forfeit significant
amounts of money from the NCAA's television package and that they were not allowed to
explain that the restricted earnings rule was passed in order to provide job opportunities
to new coaches at salaries comparable to graduate assistant wages. Soon after this
decision the United State Circuit Court of Appeals in Denver endorsed Judge Vratil's
ruling. Still, the NCAA also planned to appeal the 10th Circuit's original
decision in May of 1995, in which the Court upheld the Defendant's (Law's) motion
for summary judgment moving that the restricted earnings rule violated the Sherman Act.
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You Make the Call. . . Index
"You Make The Call..." is a newsletter published four times per year (spring,
summer, fall, winter) by the National Sports Law Institute of Marquette University Law
School, PO Box 1881, Milwaukee, Wisconsin, 53201-1881. (414) 288-5815, fax (414) 288-5818,
munsli@vms.csd.mu.edu. (www.marquette.edu/law/sports/call.html).
This publication is distributed via fax and email to individuals in the sports field upon
request.
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Editorial Staff:
Paul M. Anderson, Editor & Designer
Kirsten Hauser, Associate Editor
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Copyright © 1999 -- All rights reserved.
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