Antitrust Law Daily Wrap Up, ANTITRUST—N.D. Cal.: Attorney fee award in college athlete suit against NCAA reduced, (Apr 1, 2016)

By Linda O’Brien, J.D., LL.M.

In an action by current and former college athletes against the National Collegiate Athletic Association over for the use of their names, images, and likenesses in television broadcasts and video games, the federal district court in Oakland, California, has reduced the amount of the plaintiffs’ attorney fees awarded by a magistrate judge for work related to claims against two settling licensing companies (O’Bannon v. National Collegiate Athletic Assn., March 31, 2016, Wilken, C.).

A group of current and former student-athletes who played on men’s football or basketball teams at Division I member schools and conferences filed suit against the National Collegiate Athletic Association (NCAA), alleging that the NCAA violated federal antitrust law by conspiring with two licensing companies to restrain competition for the commercial use of their names, images, and likenesses in television broadcasts and NCAA brand video games. In September 2013, the two licensing companies reached a settlement with the plaintiff student-athletes.

Following a bench trial in June 2014, the court determined that the NCAA’s rules were an unlawful restraint of trade and enjoined the NCAA from enforcing its prohibition on student-athlete compensation. A magistrate judge recommended that the court grant the plaintiffs’ motion for attorneys’ fees and costs. The NCAA then appealed. The U.S. Court of Appeals in San Francisco affirmed the lower court’s finding of an antitrust violation and remedy relating to scholarships. However, the court reversed the portion of the permanent injunction relating to deferred compensation.

Before the court was the NCAA’s motion to review the fee order de novo.

In granting the NCAA’s motion, the court first determined that the plaintiffs’ attorney fees should be not reduced for time spent on their claims that were unsuccessful or later abandoned. The NCAA’s argument that the plaintiffs’ attorney fees incurred prior to their class certification motion should be reduced since the motion concerned claims the plaintiffs voluntarily had abandoned was rejected. The court noted, although a portion of the injunctive relief ordered by the court was reversed, the finding of liability and remaining injunctive relief was an excellent result obtained by the plaintiffs. Further, the magistrate judge properly found that the work related to the abandoned claims shared a common core of facts with the successful antitrust claims.

However, the plaintiffs were not entitled to recover fees based on work related to their claims against the two licensing companies which had been settled. According to the court, the magistrate court erred in finding that the claims against the licensing companies involved a common core of facts with the claims brought against the NCAA. The plaintiffs themselves identified nearly 8,000 hours spent on work specific to their claims against the licensing companies. In the court’ view, whether the claims were related or not, the plaintiffs could not recover fees for work that they identified as relating solely to their claims against the licensing companies. Thus, the court reduced the fee award by $3.5 million, to $40.8 million.

The case is No. 4:09-cv-03329-CW.

Attorneys: Christopher L. Lebsock (Hausfeld LLP) for Edward C. O'Bannon, Jr. Glenn Douglas Pomerantz (Munger Tolles & Olson), Robert James Wierenga (Schiff Hardin LLP) and Atleen Kaur (Miller Canfield Paddock and Stone PLC) for National Collegiate Athletic Association.

Companies: National Collegiate Athletic Assn.

Cases: Antitrust CaliforniaNews