The Penn State Debate: Are NCAA Sanctions Inevitable?

Pennsylvania State University (“Penn State”) has always been an institution of great prestige and moral character, but within a few short days, the institution where the patriarchal football coach preached, “success with honor,” had been utterly shamed and dishonored. Now, it appears that the NCAA may be piling on. 

By now, we’ve all heard the disturbing allegations against former defensive coordinator, Jerry Sandusky, and details continue to emerge regarding the indefensible cover up of these egregious acts. Penn State has already taken steps towards remedying this situation by firing Coach Joe Paterno and President Graham Spanier, and accepting the resignations of Athletic Director Tim Curley and Vice President Gary Schultz. These actions taken by the Board of Trustees have elicited mixed emotions from the community. Penn State students rioted in response to Paterno’s firing, yet just a few days later, a moment of silence for the victims was held at the outset of the Penn State Nebraska game. As evidenced by their tweets, Penn State players expressed empathy for the victims, but were also saddened by the loss of their coach. In a situation such as this, with so many details yet to be uncovered, it seems as though no one really knows how to act. One thing is certain, however, and that’s that those responsible will be punished.

The criminal and civil consequences notwithstanding, the question has been asked: what would the NCAA do? On Friday, NCAA President Mark Emmert provided an answer. Emmert announced in a letter to new Penn State President Rod Erickson that the NCAA will conduct an investigation into whether Penn State failed to exercise institutional control over its intercollegiate athletics programs. The NCAA may look into numerous provisions in its investigation. Bylaw 10.1  lists examples of what the NCAA considers unethical conduct. The bylaw states that the unethical conduct is “not limited to” the conduct provided in the examples. The NCAA could use this non-exhaustive clause to find the conduct of Sandusky and others to be unethical, and therefore, punishable by the NCAA. Furthermore, bylaw 11.1 details the conduct of athletics personnel and states that coaches must act with honesty “at all times.” Certainly the requirement of forthrightness is not limited solely to the field of play or the purely athletic context. Moreover, bylaw 11.1.2.1 states that it is the responsibility of the head coach to monitor the conduct of all assistant coaches and administrators to ensure an atmosphere of compliance. Overall, if it is discovered that administrators knew of these acts and either ignored or deliberately concealed the heinous conduct, Penn State could face the dreaded charge of “lack of institutional control.”

To be sure, any NCAA sanctions that may stem from this incident are of tertiary concern in comparison to bringing those responsible to justice and attaining some semblance of retribution for the victims, but Penn State administrators have undoubtedly been cognizant of this possibility. There are no provisions that specifically prohibit Sandusky’s alleged conduct or the covering up of such conduct, as such should simply be a matter of human decency, but if the NCAA does decide to issue sanctions against Penn State, no one will question its justification for doing so.

Yet, it is conceivable that the NCAA will do nothing here, and it is likely to let law enforcement run its course before making any definitive conclusions. It is worth noting that this case does not involve any violations on the part of the student-athletes, and the NCAA may be reluctant to impose sanctions because ultimately, the student-athletes will be most affected. Additionally, the NCAA has been historically leery to take action when a serious criminal investigation is at issue, with the Duke Lacrosse case being a recent example of this approach. The NCAA, though, may simply be waiting for the full array of facts before taking action.

Even in the wake of the recent slew of scandals transpiring in collegiate athletics, this scandal is beyond shameful when one considers the innocent lives affected and the misdeeds of the adults who were entrusted with their care. Ironically, in August 2011, former Penn State President, Graham Spanier commented on the U’s violations stating, “We absolutely must put this climate of rule-breaking behind us.” On November 11, Penn State’s Board of Trustees created a Special Committee for the sole purpose of investigating this scandal. According to the Board, the Committee will be given whatever resources necessary to make sure that an incident like this never happens again, and the Committee will be charged with holding those responsible fully accountable. It seems as though Penn State will have to heed the advice of its former President and mend its reputation. A reputation that is undoubtedly far more tarnished than any stain that could be caused by NCAA sanctions.

Hat tip to law clerks Brian Konkel and Gabriela Schultz for their work on this piece.

Sports Law Internship Opportunity

The Arizona Diamondbacks of Major League Baseball are seeking a second or third year law student for an internship in the team's legal department this upcoming spring semester. Those interested in the position can learn more here:

http://baseballjobs.teamworkonline.com/teamwork/r.cfm?i=39878

Coming Soon: NBA Forum Wars (and Why Choice of Venue will Matter)

By now, most readers are aware of three antitrust lawsuits that seek to address whether the NBA's league-wide lockout represents an illegal group boycott under Section 1 of the Sherman Act:

- Butler v. National Basketball Association (filed by NBA players against the league on Nov. 15, 2011 in the U.S. District Court for the District of Minnesota, which is part of the 8th Circuit).

- Anthony v. National Basketball Association (filed by NBA players against the league on Nov. 15, 2011 in the U.S. District Court for the Northern District of California, which is part of the 9th Circuit).

- National Basketball Association v. National Basketball Players Association (filed as a declaratory judgment suit by the NBA teams against the players on Aug. 2, 2011 in the U.S. District Court for the Southern District of New York, which is part of the 2d. Circuit).

Soon, a battle will likely emerge between the parties about which forum should hear this dispute. In a nutshell, here are two reasons why the ultimate forum might affect the case's result.

(1) Differences in Interpreting Antitrust Law's Non-Statutory Labor Exemption Make the 8th and 9th Circuits More Favorable to the Players than the 2d. Cir.


One of the key defenses in any labor-side antitrust challenge is the non-statutory labor exemption: a defense arguing that a particular claim is preempted from antitrust scrutiny by labor law. However, not all circuits apply the non-statutory labor exemption in the same manner.

In both the 8th and 9th Circuits, courts have repeatedly held that the non-statutory labor exemption shields from antitrust scrutiny only activities that (1) involve mandatory subjects of bargaining, (2) primarily affect the parties involved, and (3) are reached through bona fide arms' length bargaining. Based on this standard, the U.S. District Court for the District of Minnesota concluded in McNeil v. Nat'l Football League, 790 F. Supp. 871 (D. Minn. 1991) that the non-statutory labor exemption cannot apply after a union disclaims interest: presumably because after a disclaimer the second and third prongs of the non-statutory labor exemption cannot be met.

By contrast, the U.S. Court of Appeals for the Second Circuit in Clarett v. Nat'l Football League rejected the 8th & 9th Circuit definition of the non-statutory labor exemption in favor of a far broader non-statutory labor exemption. Thus, in the Second Circuit, the mere act of disclaiming union interest might not impose immediate liability on a sports league for maintaining terms originally implemented before such a disclaimer.

For more on the differences in interpreting the non-statutory labor exemption in the 2d. Cir. from the 8th/9th Cir., see my law review articles addressing the circuit split in the context of age requirements here and here, and Professor McCann's articles discussing this split in the context of age requirements here and here.

(2) Differences in Interpreting "Market Power" in a Labor-Side Antitrust Case

In addition, the NBA teams may seek to defend their league-wide lockout under antitrust law by arguing that the relevant market for professional basketball labor is worldwide and that within a worldwide market the NBA teams lack the requisite "market power" to illegally restrain trade under the Rule of Reason. In determining whether the relevant geographic market for men's basketball labor is limited to the United States or extends to the entire world, a court would likely consider within what range the movement of workers is "practicable."

While many NBA players' lack of interest in playing overseas may seem to indicate that doing so is not practicable and thus to relevant market should be confined to the U.S. the U.S. Court of Appeals for the Ninth Circuit case Tanaka v. University of Southern California, 252 F.3d 1059 (9th Cir. 2001) seems to go against that point. There, the court disregarded a female collegiate soccer player's preference to only accept employment near her family's home in Los Angeles in favor of the view that the market for her services extended to a greater geographic region.

While the court's holding in Tanaka does not directly bar the Ninth Circuit from finding a market for men's basketball labor that is limited to the U.S., it seems to introduce one more bar for the players' lawyers to overcome.

For more on the NBA's potential "lack of market power" defense, see my recent Rutgers Law Journal article Does the NBA Still Have 'Market Power?' Exploring the Antitrust Implications of an Increasingly Global Market for Men's Basketball Player Labor.

Questioning the NBA Players' Litigation Strategy

NBA players filed two different antitrust lawsuits against the NBA owners on Tuesday, one in the U.S. District Court for the Northern District of California, and one in the District for Minnesota. Although I haven't yet been able to track down a copy of either complaint online, the players' attorney David Boies has stated that he doesn't intend to pursue a preliminary injunction lifting the NBA's lockout in either case. Boies, of course, previously represented the NFL owners in the Brady v. NFL litigation this past spring, where he successfully persuaded a majority of the Eighth Circuit panel that a preliminary injunction blocking a lockout is improper under the Norris-LaGuardia Act.

Despite the Eighth Circuit's decision in Brady, I can't help but think that the NBA players are making a mistake by not seeking a preliminary injunction to lift the lockout. Although the NFL players ultimately lost on the injunction issue at the Eighth Circuit, they were nevertheless able to convince the district court judge, as well as one of the three appellate judges, that a preliminary injunction lifting a lockout could issue under the Norris-LaGuardia Act. And even the majority of the Eighth Circuit panel believed that injunctive relief might be appropriate to temporarily lift the lockout for at least a segment of the players (i.e., those not currently under contract with an NFL team). Therefore, there is a legitimate chance that a different judge (and perhaps a panel of the Ninth Circuit) would be willing to grant the NBA players preliminary injunctive relief preventing the NBA owners from continuing their lockout.

Given this possibility, I don't see why the NBA players wouldn't at least seek a preliminary injunction. A court order lifting the lockout would give the players perhaps the greatest bargaining leverage they could hope to achieve from a lawsuit against the owners. In turn, an injunction would provide players with the best chance of reaching a favorable resolution of the dispute in time to save at least part of the season. Meanwhile, the potential downside of seeking a preliminary injunction is minimal, since a refusal by the court would merely maintain the status quo.

Consequently, I don't understand the logic behind not seeking a preliminary injunction. What am I missing here?

New Sports Illustrated Column: Legal Implications of Jerry Sanduskys' Interview with Bob Costas

I have a new SI column on the Penn State scandal.  Here is an excerpt:

The problem with Sandusky's legal strategy is not only that a growing number of men independently charge that Sandusky raped them while they were children, but that also admitting to strange and lewd behavior with children would likely make jurors highly suspicious of him and more inclined to convict him of sexual assault. Put differently, it's hard to believe there is a merely a misunderstanding between Sandusky's recollection of the facts and that of the alleged victims when Sandusky freely admits to showing terrible judgment.

The interview also reflects poorly on Penn State. Sandusky admitted to behavior that was far from discreet and was sure to attract the attention of others. Along those lines, did no one at Penn State find it disconcerting that Sandusky was showering with boys? Did any school official notice any unusual "touching" by Sandusky? Joe Paterno's insistence that "we were all fooled" seems even more hollow after Sandusky's interview.

To read the rest of the column, click here.

Breaking News: NBA Players disclaim interest:: Legal Analysis

The 2011-12 NBA season just became less likely.  I talk to NBA TV about what today's big news means.  And then later in the evening I spoke with Dennis 3D Scott, Stan Kasten, David Aldridge and Matt Winer.

Also, here is my Sports Illustrated video on this topic, with dramatic music in the background:

Follow the Money

Here's the question. Is the Penn State scandal a sports law issue or simply a criminal matter? Consider this scenario. A young muscular graduate student in Biology wanders into a lab and sees an aging Assistant Professor raping a ten year old boy. Is there any doubt the perpetrator, if aware he had been seen, would immediately stop, the witness would intervene, the cops would be called, the Professor would be put away, and the University and its President would not be implicated in the least?

Why did that not occur here? Only one answer: the money generated by the plantation system known as the NCAA. For Penn State that is 100 million dollars, 75 million in football revenue and 25 million in assorted generic memorabilia like sweatshirts mostly attributed to the football program.

One telling fact that has not been given much attention. Look at the chain of command that failed miserably in this case. McQuery tells Paterno the coach. He tells Curley the Athletic Director. Who does he tell? Gary Schultz. His title? Vice President of Business and Finance. Among the many unanswered questions, who else knew? Typically the AD must report any potentially troubling incidents to the Conference Commissioner. Did Curley do that here? If not, why not?

UPDATE from Mike McCann: Below are some excellent comments responding to my Facebook post on Follow the Money:


Mark McKenna [Notre Dame Law Professor] 
 Is there any doubt the grad student would intervene? Absolutely there is. There has been way too much of the "this is because it was football." if anyone doesn't think a grad student dependent on a star faculty member for his future might have acted just like McQuery did, they are kidding themselves. And kidding oneself this way is dangerous because it allows all of us off the hook too easily by making this seem like a problem of some "other" culture.

Afi Johnson-Parris  [Attorney in Greensboro, North Carolina]
Is it too much to expect that he would have had even an ounce of courage to make a noise from the shadows, flicked the lights, called out "is anyone there?," something, anything to make it stop, anything but walking away. How do you just walk away? I agree, that has less to do with football than it does to do with courage. Funny, they're always saying that courage is what football is about.

Mark McKenna 
No, Afi, clearly it's not too much to ask. I wasn't in any way making an excuse for him. I was only pointing out that lots of people have made themselves feel better about this situation by pretending that this is just something about the culture of some institution rather than a sad, but universal, fact about human beings. They protect themselves and the institutions they believe in first. See also, the Catholic Church.

Michael McCann 
Not that this would have likely stopped what happened at Penn State, but I think a better model to college sports would be for there to be an independent branch of a school, sort of like an independent federal agency that's to some extent insulated from the executive branch, that regulates the athletic departments. It may moderate the "winning at all costs, everything else be damned" approach we see at too many schools. In terms of Mark and Afi's larger points, I agree that this story is about much more than why persons in a big time sports program respond so poorly to a fellow human in crisis. It also says, as Mark notes, that allegiance to institutions too often trumps allegiance to basic morality. Perhaps it also says that instead of these persons lacking humanity it's that humanity is less than what we expect or hope for.

Mark McKenna
I can't bring myself to "like" your last post, Mike, but the last sentence is right on.

Alan Milstein 
Mark, I just have to disagree. I do not think it is the norm for someone to not do anything when confronted by an old man raping a ten year old boy. Even if it is a superior, you would have to believe in an academic setting the grad student would believe the chairman of the department and everyone else would come down hard on the offender. Mainly because there is nothing to lose. That's the difference here. There was something to lose if they didn't cover it up. Millions of dollars. Incredibly, all they did was take away his locker room privileges, presumably so he could do his business elsewhere just not in the Penn State locker room.

Mark McKenna 
No, I wouldn't believe that people would act differently in another academic setting. People act selfishly whenever there is a lot for them to lose. There is a ton to lose when a graduate student reveals something about a supervisor they depend on (and grad students depend enormously on their advisors). There is a ton to lose when speaking up would force you to confront the failures of an institution you believe in. The statistics on abuse are staggering, and they couldn't be even remotely right if you were right that people generally speak up and stop things. They don't. I guarantee you that there has been undisclosed abuse in virtually any organization. This is not an apology - it's absolutely the wrong thing. But I think we delude ourselves by pretending it couldn't happen in our own back yard.

Jason Chung For me, the fact that people some people honestly say that they would have also walked away or merely alerted their superior when confronted with a similar situation is the greatest indictment of our culture.

Alan Milstein And your analogy to the Catholic Church doesn't help your point. The same forces are at work. But outside of such institutions like Penn State and the Catholic Church, where most of us reside, I have to believe most people would do the right thing and stop the brutalization. It's a ten year old boy, for God's sake. People by and large are good not bad, moral not immoral, caring not uncaring.

Mark McKenna I wish it were so, Alan. But I don't think it is. If you want to exclude all the institutions because the same forces are at work, then I think you have a long list to exclude. And that's my point.

Jason Chung
Mark, I understand your point - in today's society where everyone is looking to get ahead, there is sometimes tension between doing the right thing and doing what seems right for you personally. Sometimes, people do the latter instead of the former. Understood. However, I think that Alan's point is that the cult of big-money sports amplifies what we would consider "acceptable" in the realm of distasteful things one would tolerate. I'm not sure that I entirely agree with that assessment but I do acknowledge that sports, and particularly collegiate sports, has more than a fair whiff of an insular, old boys network feel to it where omerta and misguided "loyalty" is preferable to decency. I'd normally make an analogy or example trying to illustrate this point but, frankly, this entire issue is so beyond the pale, it makes me sick. This equalizer is this - At least, we, the fans, don't have to accept it. Stay vigilant, make noise, keep those responsible (and those who enabled) accountable.

Alan Milstein
This story is just beginning. The cover up has yet to be uncovered.