Tennessee, Virginia Sue NCAA Over Antitrust Issues in Recruiting

The attorneys general of Tennessee and Virginia filed an antitrust lawsuit against the National Collegiate Athletic Association over its restrictions on athletes’ use of their likenesses, adding to the organization’s legal battles.

The lawsuit, filed on Wednesday in the US District Court for the Eastern District of Tennessee, claims the NCAA violated federal antitrust laws by banning the use of name, image, and likeness, also known as NIL, in recruiting. It comes as states and federal antitrust enforcers are increasingly scrutinizing the NCAA over anticompetitive conduct.

The state plaintiffs allege the NCAA’s guidelines deny prospective college athletes “the ability to effectively negotiate their NIL rights at the very time they would best be able to maximize the value of those rights,” resulting in unfair compensation down the line.

“The NCAA’s illegal conduct has just begun in earnest and will continue to impose immediate, irreparable, and sustained harm on college athletes, institutions, and consumers of college athletics unless injunctive relief is granted,” the complaint states, calling for an injunction to block enforcement of the recruiting rules.

The suit follows reports that the NCAA is investigating the University of Tennessee for alleged violations of NIL guidelines. The NCAA has previously defended its rules, saying the association supports student athletes profiting from their NIL rights and is expanding benefits for athletes.

The Department of Justice earlier this month joined a separate state-led antitrust suit against the NCAA over a rule that restricts some student athletes from competing if they transfer between Division I schools.

College athletes also won class action status last November in a California case that similarly accuses the NCAA of denying athletes compensation for use of their likeness. The organization and its member conferences could face damages of up to $4.5 billion.

In the face of these legal challenges, the NCAA proposed in December to directly compensate student athletes. Some antitrust experts criticized the proposal for not adequately addressing competition and compensation concerns raised in the various lawsuits.

The case is State of Tennessee v. National Collegiate Athletic Association, E.D. Tenn., No. 24-cv-00033, 1/31/24.