A long-awaited federal appeals court decision is another mark in the win column for a group of former college athletes suing the National Collegiate Athletic Association (NCAA) and their former schools, McGuireWoods partner Sarah Wake told The National Law Journal in a July 22, 2024, story.
The plaintiffs in Johnson, et al. v. National Collegiate Athletic Association, et al. argue that Division I student athletes are employees of the NCAA and its member schools under the Fair Labor Standards Act and various state wage and hour laws. On July 11, 2024, the U.S. Court of Appeals for the Third Circuit affirmed the U.S. District Court for the Eastern District of Pennsylvania’s denial of the NCAA’s motion to dismiss the suit. The district court will now decide if student athletes are employees based on an “economic realities” test.
Wake, who advises universities on athletics compliance issues, told the NLJ if the district court rules and the Third Circuit agrees that student-athletes are employees, it would create a split with other circuits. If that happens, the NCAA may not seek U.S. Supreme Court review, given the 2021 decision in NCAA v. Alston, in which the justices rejected NCAA restrictions on noneducation-related compensation for athletes.
“I think the NCAA would very carefully consider whether it is prudent to appeal to the court,” Wake said. “Alternatively, if student-athletes are ultimately the losing party before the Third Circuit, they could — and likely would — appeal to the Supreme Court.”
Wake and associate Paul Chappell analyzed the Third Circuit ruling in a July 12, 2024, McGuireWoods legal alert.