The New York Times tells of a Clemson fan who has launched UBooster, a site designed to allow college sports fans to pledge money to help attract high school athletes to the donors’ preferred schools–in other words, exactly what Dan, Mike McCann, and I proposed. (H/T: Gregg Polsky). According to the story, fans pledge money to a particular recruit, with a note urging him (or her) to choose a particular school; no more money can be contributed once the athlete commits to a school and the money is held in trust until after the player finishes college. The money is not funneled through the university and there is no direct contact between UBooster and either the athlete or any particular school. For that reason, the founder, Dr. Rob Morgan, believes this does not violate NCAA rules and, in fact, offers a way to allow fan involvement while easing the financial burden on universities to do more to help athletes.
The former head of the NCAA’s Committee on Infractions calls this “far more sophisticated than the hundred-dollar handshake,” but I am not sure it is a meaningful difference in kind. Student-athletes are still receiving money because they are student-athletes and because of their athletic ability, and the lack of a direct connection among student-athlete, school, and donor does not change that; in fact, the NCAA’s point is specifically to keep “strangers” from giving student-athletes money, regardless of connection to the school. Nor does the four-year delay in getting the money change much–it is still money for playing a sport, whether the benefit is received immediately or in a few years. I also do not believe the absence of an express quid pro quo (the student-athlete gets the money, regardless of where he ultimately plays) makes a difference; the NCAA regs are designed to avoid bidding wars and allowing the athlete to keep everything is not going to alleviate (or necessarily disincentivize) such bidding wars.
Mind you, I am not speaking in support of the NCAA’s regs or the current model of college sports. I am only saying that, under those rules, any student-athlete who participates in this (and any school for which he plays) is in for some problems.
Posted by Howard Wasserman on December 11, 2015 at 06:37 PM
Comments
As the CEO of UBooster I’m grateful for the discussion and analysis. We founded UBooster with a goal of providing the 98+% of college athletes who will not play professionally a means of having “trust fund” that can be used for moving expenses, job training, graduate school, etc.
The term “student-athlete” was created by former NCAA President Walter Byers, who later disavowed this concept in his book, Unsportsmanlike Conduct: Exploiting College Athletes. He did so stating that this term established “a nationwide money-laundering scheme.”
I therefore respectfully disagree with Mr. Wasserman’s analysis regarding the idea that “student-athletes are still receiving money because they are student-athletes….” Legally speaking these young men and women are high school students, or even using the terminology of the NCAA, they are “individuals.” Techincally speaking, they are not receiving money because they are student athletes. Either way, the last time we checked, the NCAA does not create U.S. constitutional law. Nevertheless, the NCAA continues to add to a 350+ page set of Bylaws that attempts to establish its monopoly over a multi-billion dollar empire.
In her original O’Bannon v NCAA decision, Judge Wilken envisioned a trust fund for college graduates. Since that time the NCAA has embraced the concept of cost-of-living stipends for its student-athletes (note the “proper” use of this term given that these are college students) despite the fact that it unanimously rejected this idea just a few years ago. Perhaps a lawsuit and shifting public opinion have started to have an impact, or otherwise over 100 college Presidents suddenly had a massive change of heart.
Either way, the NCAA continues to fight the O’Bannon case and will oppose the Jenkins case in that both propose certain basic compensation for the players who make this multi-billion dollar industry possible. At UBooster we side with the athletes. Is there a profit opportunity for our company? Certainly. We are nevertheless on the lowest end of any crowdfunding site in terms of administrative fees and are attempting to support the players beyond just their college years.
Posted by: Rob Morgan | Dec 17, 2015 10:45:03 PM
I don’t do contracts, either. But idea of specific performance is to protect whatever interests/rights/benefits of the contract, where damages won’t protect those interests. The NCAA would enter these contracts to protect its mission of amateurism, etc. If you’re right that damages can’t be calculated, specific performance becomes appropriate.
Posted by: Howard Wasserman | Dec 13, 2015 4:48:08 PM
Contracts isn’t my area and law school was a long time ago, but I don’t remember anything about preserving internal operations as a grounds for specific performance in contract.
I can see the vacating wins etc as being wholly within the NCAA’s power, but it is a bit of a paper tiger. If UBooster got any real traction they’d end up needing to retroactively wipe out entire seasons, and a penalty that’s applied to all teams is essentially meaningless.
Reading the linked article about FanPay it looks like the hook the schools are trying to use in their cease and desist letters are personality rights. The idea being that the websites use the students’ names without their permission. I guess the students must sign some sort of agreement allowing the schools to litigate on their behalf. Personality rights also not being my area, I’m not sure how strong a hook that is exactly.
Regardless I wish the two companies godspeed.
Posted by: Brad | Dec 13, 2015 2:38:14 PM
As I said, I’m not defending the current system. Just saying that this is inconsistent with that system.
Posted by: Howard Wasserman | Dec 13, 2015 1:23:52 PM
Someone remind me what the justification for prohibiting players from taking money for their brain damage and tolerating half-assed exploitative education is again?
Oh, yeah, cartel. That’s the justification. Check.
Posted by: Paul Gowder | Dec 13, 2015 1:20:21 PM
I don’t know about damages, but perhaps the NCAA could get specific performance of that contract, in the interest of preserving its internal operations. Also, even a player breached the contract and took the money, the NCAA might punish the school by vacating wins, championships, records, etc.
Now, that latter move would be met with such resistance that it might bring the entire edifice crumbling down. But I imagine those would be the internal operations.
Posted by: Howard Wasserman | Dec 12, 2015 6:14:37 PM
Given that the NCAA rules don’t bind third parties and the student’s consent is not needed, what exactly can the NCAA do about it? If they bar any student with a trust waiting for him at UBooster than anyone that wants to end college basketball can just open an account with $1 for ever potential high school student basketball recruit in the country.
I suppose they can ask the students to sign a contract agreeing to never take the money, but would that be enforceable? What are the damages to the NCAA?
Posted by: brad | Dec 12, 2015 5:05:30 PM