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In a recent and possibly groundbreaking 3rd circuit opinion, Renee Smith, a college volleyball player sued the NCAA claiming that the NCAA's "Postbaccalaureate Bylaw" (Bylaw 14.1.8.2) violated §1 of the Sherman Act and Title IX.

R.M. Smith v. National Collegiate Athletic Association, 139 F.3d 180 (3^rd Cir. 1998).

Smith was a member of the intercollegiate volleyball team at St. Bonaventure University during the 1991-92 and 1992-93 season. She did not participate in volleyball during the 1993-94 season and graduated from St. Bonaventure in 2 * years. Soon after she enrolled at Hofstra University in its law school, and then in 1995 she enrolled at the University of Pittsburgh. St. Bonaventure does not have a law school. During her enrollment at Hofstra and Pittsburgh Smith attempted to participate in intercollegiate volleyball and was denied eligibility.

Two NCAA rules impact this situation. Initially, Bylaw 14.2.1 mandate that a student-athlete "shall complete his or her seasons of participation (4 seasons are the maximum allowed) within a five calendar year period." As Smith had begun participation in the 1991-92 season she would generally have been able to continue participating until the 1995-96 season.

However, as Smith had graduated and enrolled in a different school Bylaw 14.1.7 came into affect. This bylaw "provides that a student-athlete may not participate in intercollegiate athletics at a postgraduate institution other than the institution from which the student earned her undergraduate degree." Id. at 183.

In August of 1996, Smith instituted a lawsuit against the NCAA challenging its enforcement of Bylaw 14.1.7 and refusal to grant her a waiver of the rule on both antitrust and Title IX grounds.

On May 21, 1997, the district court dismissed her claim holding that the NCAA's refusal to grant a waiver was not the type of action amenable to antitrust attack, and that Smith did not adequately allege that the NCAA was subject to Title IX as a recipient of federal funds. R. M. Smith v. National Collegiate Athletic Ass'n, 978 F. Supp. 213 (W.D. 1997). Subsequently, Smith submitted an amended complaint which the district court denied. She then filed an appeal.

The 3^rd Circuit began its review with a discussion of Smith's Sherman Act claim. In her appeal, Smith asserted that the district court erred in limiting application of the Sherman Act to the NCAA's commercial and business activities. Smith, 139 F.3d at 184. As the 3^rd Circuit framed it, the issue was "whether antitrust laws apply only to the alleged infringer's commercial activities." Id. at 185.

The Court began its discussion of this issue by noting that "the Supreme Court has suggested that antitrust laws are limited in their application to commercial and business endeavors." Id. Although no appellate court had addressed the application of antitrust laws to the NCAA's eligibility rules, several district courts had held that the Sherman Act "does not apply to the NCAA's promulgation and enforcement of eligibility requirements." Id. The 3^rd Circuit agreed that the eligibility rules were not connected to the NCAA's commercial and business activities, and therefore, the Sherman Act did not apply.

The Court next approached Smith's Title IX claim. As the Court explained, the NCAA is subject to Title IX if it receives federal financial assistance as defined in the statute. In framing this issue, the Court noted that in cases dealing with § 504 of the Rehabilitation Act, the Supreme Court has made no distinctions between direct and indirect financial assistance. The Supreme Court had merely distinguished between "entities which indirectly benefit from federal assistance and those that indirectly receive federal assistance," holding only the latter amenable to Title IX. Id. at 188. Therefore, the 3^rd circuit held that

the NCAA is not merely an incidental beneficiary of federal funds. Given the breadth of the language of the Title IX regulation defining recipient, we hold that allegations in Smith's proposed amended complaint, that the NCAA receives dues from its members which receive federal funds, if proven, would subject the NCAA to the requirements of Title IX.

Id. at 189. Therefore, the case was remanded back to the Western District of Pennsylvania.

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