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On Day 12, O'Bannon v. NCAA shifts to topic of product endorsements

OAKLAND, Calif. -- The crux of the Ed O’Bannon v. NCAA case involves the use of athletes’ names, images and likenesses for commercial purposes, but testimony over the first two weeks of the trial centered primarily on TV broadcasts and video games. Whether it was the NCAA’s intention or not, Day 12 piqued Judge Claudia Wilken’s interest in the subject of product endorsements.

The NCAA began the day by calling Greg Sankey, the SEC’s executive associate commissioner and chief operating officer, as well as the soon-to-be chairman of the NCAA’s Committee on Infractions. Sankey provided a stronger, more reasoned voice than most previous witnesses about the NCAA’s amateurism justifications. Asked why potential name, image and likeness payments to athletes would undermine SEC institutions’ missions, Sankey replied succinctly: “There's no attachment to academics as there is with scholarships.” He also expressed concern that recruiters would place more emphasis on potential payments than actual competition or academics. 

But when NCAA attorney Carolyn Hoecker Luedtke began asking about the possible consequences of third-party payments by “an overzealous fan,” Wilken seemed puzzled. She questioned whether the topic of third parties fell under the purview of the case, with the NCAA countering that the plaintiffs are asking her to allow all forms of name, image and likeness payments. Theoretically, local car dealers and real estate agents could pay the star quarterback to appear in their ads. Thus began a long sequence about product endorsements. 

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Last week, the plaintiffs showed a picture of witness Chase Garnham, a recent Vanderbilt linebacker, appearing in front of a press-conference backdrop with Gillette and Dollar General logos, suggesting he’s implicitly endorsing those products (with no compensation). The NCAA brought back the same photo, asking Sankey if he believes it violates amateurism principles. No, he said, because those companies are sponsors of the overall athletic department. Same thing with a 2013 Georgia poster schedule featuring Aaron Murray and three other players, with logos for companies like Delta at the bottom. 

The NCAA even broke out photos of little league teams celebrating in front of scoreboards with sponsors, or a backdrop with a Subway logo, insinuating that college athletics are hardly the only amateur sports with corporate sponsors. 

After a short break, Luedtke planned to address a new topic, but Wilken had some questions of her own. 

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“What about a contract with Gatorade?” she asked Sankey. “Everyone’s drinking Gatorade on the sideline, and it’s on television, is that OK?” After Sankey described how Gatorade does sponsor certain schools and provide its product for use, Wilken then followed-up with, “But it’s not OK for the athletes to get money from Gatorade?” Told no, she offered a quizzical look.

Shortly thereafter she followed with much the same line of questioning about apparel manufacturers like Nike and Adidas. “Again, as long as the manufacturer pays the school, it’s OK, but not the athlete?” she asked. 

Given how infrequently Wilken disrupts the attorneys to ask her own questions, her curiosity about the machinations of sponsorships is potentially significant. It may be that she’s been so focused on video games and television contracts that she hadn’t considered the possibility that athletes currently serve as unofficial unpaid endorsers for Gatorade or Nike due to their schools’ sponsorships – and whether that in itself is an implicit use of name, image and likeness.

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After court, plaintiffs’ attorney Renee Steiner said of Wilken: “I think she’s still wrestling in her mind with the distinction between a television advertisement with a student-athlete saying, ‘Buy Gatorade,’ and a student-athlete being on the sideline of the national championship game with millions of people watching -- and he’s holding a Gatorade cup or a Dasani cup and drinking from it. How the [NCAA] makes that distinction and the significance of that distinction, in their minds.” 

“In my mind, they’re apples and oranges,” Donald Remy, the NCAA’s chief legal officer, said of the difference between sponsorships of teams and individual product endorsements. “As you saw with other amateur organizations, the notion of having a sponsorship to help fund some of the activities of an athletics enterprise is not a strange notion at all. It happens quite frequently. ... That’s quite different than an individual becoming a professional who markets himself as a professional and gets remunerated.”  

Other notable moments from court Tuesday:

  •  In his cross-examination, plaintiffs’ attorney Sathya S. Gosselin repeatedly used Sankey’s SEC affiliation as cause to introduce various tidbits that run contrary to the NCAA’s defenses. He showed, for example, that in fiscal year 2011 the SEC paid $2.2 million to a television consultant, Chuck Gerber, who helped devise the SEC Network, seemingly flying in the face of arguments that college sports aren’t profitable. He showed a series of SEC teams with poor graduation rates, most notably 8 percent for Arkansas basketball.

    In the most amusing exchange, Gosselin tried to goad Sankey into bragging about SEC football in order to prove competitive balance in college sports is already out-of-whack. “Is it your testimony that the SEC does not dominate competition on the field?" asked Gosselin. "No, but we are clearly successful," responded a diplomatic Sankey.
  • Stanford AD Bernard Muir returned to the stand briefly to finish his cross-examination from last week. Since the NCAA had used Sankey to establish that corporate signage in stadiums is not unusual in amateur athletics, the plaintiffs showed a picture of Stanford’s stadium, noting it has no signage. Muir agreed that Stanford can afford to run its athletic department without such sponsorships (thanks in part to private donors). 
  • The NCAA next called Diane Dickman, its managing director for academic and membership affairs, ostensibly for validating its defense that “integration of athletics and academics” justifies restriction on compensation. Dickman cited the NCAA’s APR penalties for poor classroom performance – like Connecticut’s 2013 NCAA tournament ban – as an example of the organization enforcing that balance.

    On cross, Dickman got defensive when plaintiffs’ attorney Bill Isaacson tried to poke holes in the APR’s methodology. He also asked whether her organization was investigating North Carolina for its much-chronicled academic abuse scandal. “I don’t know,” she replied. “That’s not my department.
  • With about 20 minutes left, the NCAA called Dr. John Dennis to begin discussing a survey he conducted last year entitled “Public Opinion About Paying Student-Athletes,” which found that 7 in 10 Americans oppose paying college athletes. He’d begun discussing the methodology behind the survey when court adjourned for the day.