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Ed O'Bannon lawsuit: Judge rules against NCAA

Photo: G Fiume/Getty Images

A federal judge has ruled against the NCAA in a landmark antitrust suit brought by a group of plaintiffs led by former UCLA basketball player Ed O'Bannon.

U.S. District Judge Claudia Wilken ruled that the college governing body's limits on athlete compensation violate antitrust laws.

Wilken issued an injunction that will "enjoin the NCAA from enforcing any rules or bylaws that would prohibit its member schools and conferences from offering their FBS football or Division I basketball recruits a limited share of the revenues generated from the use of their names, images, and likenesses in addition to a full grant-in-aid.”

More: O'Bannon v. NCAA: With trial over, what comes next?​

Though the NCAA may still cap football and men's basketball players' compensation while they are enrolled in school (the cap cannot be below the cost of attendance), the athletes are entitled to a "limited" share of licensing revenue from a trust after they leave school or upon their eligibility expiring.

The NCAA will be allowed to cap the amount of money held in the trust, but the cap cannot be below $5,000 for every year athletes remain academically eligible. 

The injunction will not take effect until the start of the next football and basketball recruiting cycle, meaning it won't apply to athletes who enroll before July 1, 2016.

Wilken also ruled that the NCAA can continue to prohibit athletes from being compensated for endorsements.

The NCAA released a statement in response to the ruling:

“We disagree with the Court's decision that NCAA rules violate antitrust laws. We note that the Court's decision sets limits on compensation, but are reviewing the full decision and will provide further comment later. As evidenced by yesterday’s Board of Directors action, the NCAA is committed to fully supporting student-athletes.”

– NCAA Chief Legal Officer Donald Remy

The ruling comes a day after the NCAA Division I Board of Directors approved a new governance structure granting more rule-making autonomy to the nation's five wealthiest conferences.

The NCAA is expected to appeal the ruling.

- Chris Johnson

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