During the 1980s, the NCAA, a voluntary unincorporated association of approximat
ID: 408221 • Letter: D
Question
During the 1980s, the NCAA, a voluntary unincorporated association of approximately 1,100 educational institutions, became concerned over the steadily rising costs of maintaining competitive athletic programs. As a way of containing those costs, the association imposed salary caps on college and university athletic coaches. The caps on salaries as well as limits on number and types of coaches were imposed pursuant to NCAA procedures and members’ votes. A group of coaches filed suit, challenging the caps on salaries and hiring as being anticompetitive. The NCAA responded that it had a goal of containing athletic program costs as well as ensuring that entry-level coaching positions were available. Are the salary caps legal under the federal antitrust laws? [Law v. National Collegiate Athletic Ass’n, 134 F.3d 1010 (10th Cir.)]
Explanation / Answer
No, it is considered to be violating federal antitrust laws,Sec 1 of Sherman Act. It is also considered to be unlawful restraint of trade.
According to the Restricted Earnings Coaches rule stated that the Compensation packages is $12,000 per year + $4,000 in the summer months as coach salaries.
NCAA doesn't have a right to pay the salary to coaches less than $12,000.
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