Antitrust Law Daily Wrap Up, ANTITRUST—S.D. Ind.: Judge disqualified in NCAA case challenging scholarship rules, (Jan 30, 2015)

By Linda O’Brien, J.D., LL.M.

In a class action by a former college student-athlete against the National Collegiate Athletic Association (NCAA) for allegedly unlawfully restraining trade among its member institutions for the labor of student-athletes, a judge in the federal district court in Indianapolis has granted the plaintiff’s motion for disqualification and has recused herself (Rock v. National Collegiate Athletic Association, January 29, 2015, Boone, S.).

Former college student-athlete John Rock, who had played Division I football on scholarship, and two former college student-athletes, who played basketball and hockey for Division III (non-scholarship) schools, filed suit against the NCAA, challenging association bylaws prohibiting multi-year athletics-based scholarships, capping the number and amount of athletics-based scholarships, and banning athletics-based scholarships at Division III schools.

In March 2013, the court granted the NCAA’s motion to dismiss Rock’s amended complaint without prejudice. In August, 2013, NCAA’s motion to dismiss Rock’s second amended complaint was denied on the grounds that the complaint alleged a legally cognizable relevant market. In November 2014, Rock filed a motion for class certification and for leave to file a third amended complaint for the purpose of conforming the class definition in the complaint to the definition in his class certification motion. After Rock’s motion to vacate a shortened discovery deadline was denied, he filed a motion to disqualify the assigned district court judge. The court requested reassignment of Rock’s motion for leave to amend, which was ultimately granted by the reassigned judge.

Under 28 U.S.C. 455, a judge shall disqualify himself or herself in any proceeding (1) in which the judge’s impartiality might reasonably be questioned, (2) if the judge has personal knowledge of disputed evidentiary facts concerning the proceeding, or (3) if the judge, individually or as a fiduciary, has a financial interest in the subject matter in controversy, in a party to the proceeding or any interest that could be substantially affected by the outcome of the proceeding, the court explained.

Rock requested disqualification on the grounds that (1) a reasonable observer might question the judge’s impartiality to preside over the case, since she was a member of the Butler University Board of Trustees and Butler is a NCAA Division I football school; (2) as a Butler trustee, the judge had personal knowledge of disputed evidentiary facts of the case; and (3) Butler’s alleged interest in the outcome of the case was imputed to the judge as a trustee. In opposition to the motion, the NCAA contended that none of Butler’s student-athletes could be members of the Rock’s proposed classes and any effect the case could have on Butler’s interests was remote and speculative.

The court noted that, at the time she became a Butler trustee, Rock’s second amended complaint was the operative pleading in the litigation and remained so until January 23, 2015, when the reassigned judge granted Rock leave to file his proposed third amended complaint. Since Butler does not award football scholarships, its student-athletes could not have been part of Rock’s proposed putative class, and Butler would not have been substantially impacted by the relief sought by Rock.

Moreover, the court stated that at no time was the subject matter of Rock’s claims discussed at trustee meetings during her tenure, and she had no personal knowledge of any disputed evidence at issue in his claims. Thus, disqualification would have been unwarranted at the time the proceedings were governed by the second amended complaint.

However, under the class definition in the third amended complaint, there is a dispute about whether any Butler football players could be members of the putative classes and whether Butler would be substantially effected by the injunctive relief that Rock requests. To eliminate those issues from the case and to focus the parties’ time and resources on litigating the merits of the case, the judge recused herself.

The case is No. 1:12-cv-01019-TWP-DKL.

Attorneys: Daniel J. Kurowski (Hagens Berman Sobol Shapiro LLP) for John Rock. Gregory L. Curtner (Schiff Hardin, LLP) for National Collegiate Athletic Association.

Companies: National Collegiate Athletic Association

Cases: Antitrust IndianaNews