Weber State Football Player Challenges NCAA’s Transfer and Scholarship Rules in Antitrust Lawsuit

11/05/2015

National class action calls NCAA regulations “patently unlawful,” alleges illegal limitations to student-athletes’ rights costing them tens of millions

SEATTLE – A college quarterback who lost his Division I scholarship due to National Collegiate Athletic Association (NCAA) rules that prevent Division I football players from transferring to other NCAA Division I schools without losing athletic eligibility for a year is challenging the organization in court, claiming that the NCAA’s transfer limits violate federal antitrust laws, according to Hagens Berman and The Paynter Law Firm PLLC.

The lawsuit filed Nov. 5, 2015 states that the NCAA’s limitation on the mobility of college athletes is patently unlawful and challenges the NCAA’s rules that prevent Division I football players from transferring to other Division I schools without losing athletic eligibility for a year – as a result of the year-in-residence requirement, class members receive millions of dollars less in athletics-related financial assistance and other direct compensation than they would receive if class members were permitted to transfer without this limitation. The suit also tackles the NCAA’s continuing cap on the number of football scholarships a Division I football team may award as well as the NCAA’s former prohibition on multi-year scholarships.

In addition to Division I football players, the lawsuit seeks to represent anyone who, since November 2011, sought to transfer from one NCAA Division I football school to another, but was athletically ineligible to participate in NCAA Division I football for any period of time under the NCAA’s transfer rules. If you have information you believe is important to the case, contact Hagens Berman.

The student named in the lawsuit, Devin Pugh of Utah, was sought after and recruited by numerous FBS schools in high school. Devin ultimately selected Weber State, where he was a skilled cornerback, based on the pledge of the head coach that his scholarship would be renewed annually as long as Devin remained eligible for NCAA competition, and even if there was a coaching change.

However, after his head coach retired, the new coach decided not to renew Devin’s scholarship. Upon learning that Devin was interested in transferring as a result, three FBS and three FCS schools offered Devin full grants-in-aid to transfer -- contingent upon Devin’s ability to play two more years of NCAA football. Devin ultimately saw all offers rescinded after he was forced by NCAA regulations to sit out of competition for one year.

“Student-athletes who jockey for these scholarships suffer severe penalties for transferring, while NCAA coaches are allowed to job hop, reaping enormous financial benefits and rising to earn more than $3 million per year,” said Steve Berman, managing partner of Hagens Berman and lead attorney representing the class of student-athletes. “Devin’s story is just one example of the double-standard the NCAA has against student-athletes in the multibillion dollar industry of college sports, and we believe hardworking student-athletes like Devin shouldn’t be punished.”

The suit states that at least 34 Division I head football coaches now earn more than $3 million per year, even prior to the calculation of what can often be performance bonuses in excess of $1 million, and that at least 37 Division assistant coaches earn more than $600,000 per year, prior to the calculation of performance bonuses. Annual revenues for the NCAA’s 2007-2008 fiscal year were $614 million.

Around December 2011, Weber State named a new head football coach, and a year later, Devin was told by the new coach that he would no longer have the promised scholarship at Weber State.

After he was unsuccessful in securing a waiver of the NCAA transfer rules which forced him to sit out of competition for a year, Devin was unable to stay in school without a scholarship, forced to transfer to CSU Pueblo, a Division II school.

Devin’s grant-in-aid at CSU Pueblo was substantially less than what he received at Weber State, and he was forced to borrow double the amount of money he borrowed at Weber State just to cover his expenses.

“We believe that the NCAA and many other sports governing bodies are in a period of change, but if the NCAA refuses to make these changes willingly, we intend to fight tenaciously for the rights of student-athletes against what we see as patently unlawful antitrust behavior,” Berman added. “These regulations restrain players’ ability to make the best choices for themselves. If they transfer, they risk losing it all, and often transfers are made based on financial and personal circumstances.”

The suit states that the loss of a year of athletics eligibility can make student-athletes a very unattractive option for coaches who are under constant “win now” pressure.

The suit also highlights the NCAA’s artificial restriction to the total number of available Division I football scholarships, another antitrust, uncompetitive practice that leaves injured or ineligible student-athletes cut from a team and their scholarships terminated, according to the suit.

“Once their scholarships are terminated, Division I football student-athletes who wish to remain in school face three unpalatable options:  (i) pay tuition out of pocket, often by taking on tens of thousands in loans, (ii) uproot themselves and transfer to another institution that will provide them with a scholarship, or (iii) uproot themselves and transfer to a new school and pay tuition.  They would not incur these expenses and/or hardships but for the existence of the challenged unlawful restraint and agreement,” the suit states.

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About Hagens Berman
Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law firm with offices in 10 cities. The firm has been named to the National Law Journal’s Plaintiffs’ Hot List eight times. More about the law firm and its successes can be found at www.hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.

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