SAN FRANCISCO (CN) - The NCAA and its five biggest football conferences collude to limit financial aid to college athletes at far below market levels, a former running back for the West Virginia Mountaineers claims in a federal antitrust class action.
Shawne Alston sued the NCAA, the Pac 12, the Big Ten, the Big 12, the Southeastern Conference and the Atlantic Coast Conference, in a 120-page lawsuit. His lead counsel is Jon T. King, with Hagens Berman Sobol Shapiro, of Berkeley.
Alston claims that the NCAA and its power conferences violate the Sherman antitrust Act by colluding to cap the financial aid given to players at a level below what it costs them to attend college, and far below what the competitive market would pay.
He seeks two specific remedies: an injunction to restrain the NCAA and its power conferences from continuing to limit financial aid at its current level; and damages for the difference between the grants-in-aid awarded and the cost of attendance.
Alston played running back for the Mountaineers from 2009-2012. According to the lawsuit, he had to borrow more than $5,000 to cover the difference between his scholarship and what it cost to attend school.
He wants the power football schools to be ordered, or at least able, to include the actual cost of attendance, and possibly more, in their scholarships.
"Division I football ... generates billions of dollars a year in revenue. Not a single dollar of that revenue, however, would exist if it were not for the efforts of the ... football players themselves," the complaint states.
Alston then lists the eye-popping revenue reported by some top football programs for the 2011-12 season: Texas with $109 million in revenue and $82 million in profit; Michigan with $85 million in revenue and $59 million in profit; and Alabama with $82 million in revenue and $47 million in profit.
The top five revenue-producing football programs include Auburn, with $77 million in revenue and $39 million in profit, and Georgia, with $75 million in revenue and $51 million in profits, according to the complaint.
According to Alston's figures, the top five football schools enjoy a more than healthy 65 percent profit margin from their football programs: reporting $277 million in combined profits from $428 million in combined revenue.
"While players scrimp, coaches and universities most certainly do not," Alston says in the complaint. "The average salary for major college football coaches is over $2 million, with some coaches earning over $7 million."
Alston observes that Alabama Coach Nick Saban, who makes $7 million, was given a $1.5 million raise that would have translated to $17,000 for each player on his team on scholarship.
Assistant coaches are making as much as $4 million per year, conference commissioners are making millions per year and athletic directors are also bringing home giant paychecks. NCAA officials do quite well, too, according to the complaint, which says that NCAA President Mark Emmert earns $1.67 million per year.
All of this is possible due to enormous television contracts. ESPN and other networks pay billions of dollars for rights to broadcast games, while players struggle to make ends meet, and can lose their scholarships and their right to play at all for something so simple as accepting a junker car from a booster, to get to practice.
Many coaches and others in NCAA leadership have even acknowledged the problem. The lawsuit cites more than a decade of such comments. It claims that Emmert said in December 2013: "We've been working on that for 2½ years. They were talking about that long before I showed up. We don't need a lawsuit to do the right thing. That's important for people to know."
Citing the "robust competition" among the schools and conferences to recruit players, Alston suggests that this robust system be enlarged, in line with antitrust law, so that the conferences "compete among themselves ... as to the financial aid terms that conference members will make available to college football players. Such incremental competition would allay the fears (even though unfounded) of those that decry the repercussions of an instantaneous transition to a wide-open free market, with every school making its own independent decisions."
Co-counsel includes attorneys with Pearson, Simon & Warshaw, of San Francisco.