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Spielman's lawsuit against OSU could be monumental

Chris Spielman's lawsuit against Ohio State could set monumental precedent

MICHAEL MCCANN – SI legal expert

Sunday July 16th, 2017


In the first player name, image and likeness lawsuit since Ed O’Bannon’s historic victory against the NCAA became final in 2016, former NFL All-Pro and Ohio State linebacker Chris Spielman filed a federal lawsuit on Friday against his alma mater and IMG College, the popular sports marketing company that negotiates on behalf of Ohio State and many other colleges. Spielman contends that Ohio State and IMG College, along with co-conspirators Honda and Nike, have unlawfully conspired under federal antitrust law to deny payment to current and former Ohio Sate football players.

Spielman’s 35-page complaint details how Honda-sponsored banners hung at Ohio Stadium—where the Buckeyes play their home games and which seats approximately 102,000 fans—depict Spielman and 63 other notable Buckeyes, such as Archie Griffin, Jim Stillwagon, Bill Willis and Andy Katzenmoyer. According to Spielman, these players never agreed to appear on the banners and weren’t paid by OSU, Honda or anyone else for their appearances. Essentially, Spielman is asking, shouldn’t both Ohio State and the players be paid when those players appear on banners?

Spielman’s complaint also takes aim at OSU’s license agreement with Nike. OSU and Nike have a contractual relationship to produce “Legends of the Scarlet and gray” vintage OSU jerseys, which depict, without accompanying compensation, Spielman and other former Buckeyes stars. Spielman contends that these businesses worked with OSU in an unlawful plot whereby they refused to negotiate with OSU football players, thus setting the value of those players’ identity rights—which are clearly marketable since Honda and Nike paid for them—at $0.

The 51-year-old Spielman, who is now a Fox NFL analyst, demands the U.S. District Court for the Southern District of Ohio enjoin Ohio State and IMG College from continuing to use current and former Buckeyes players’ identities for profit without first negotiating those rights with the players. He also requests that the court compel the defendants to pay monetary damages to former players for past usage. Spielman has told the Associated Press that he would donate any money he receives from a victory or settlement to the Ohio State athletic department. Just like Ed O’Bannon in his lawsuit, Spielman would not personally profit in any way should he succeed. O’Bannon and Spielman brought their cases to change rules and raise awareness.

As explained below, Spielman’s lawsuit is significant on at least five levels.

I. O’Bannon’s victory paved the way for Spielman’s lawsuit, but it doesn’t guarantee that Spielman will also succeed

Spielman’s lawsuit is a direct effort to compel a university to follow the O’Bannon ruling.

O’Bannon, the former UCLA basketball star, led a class action lawsuit against the NCAA over the unauthorized use of his and other players’ names, images and likenesses in video games, classic TV broadcasts, trading cards, apparel and other products that generate substantial revenue for the NCAA and its members. U.S. District Judge Claudia Wilken ruled in his favor in 2014. O’Bannon proved that the NCAA and its members unlawfully conspired against current and former Division I men’s basketball and football players to deny them of the right to negotiate the use of their identities.

In 2015, the U.S. Court of Appeals for the Ninth Circuit ruled that the NCAA and its members can comply with the O’Bannon decision vis-à-vis current players so long as schools are permitted to offer those current players the full cost of attendance. The Ninth Circuit left the door open for former and prospective players—neither of whom is eligible for the full cost of attendance since neither consists of current college students—to file additional lawsuits for compensation. The Ninth Circuit’s ruling became final in 2016, when the U.S. Supreme Court declined to review the case.

Spielman’s complaint invokes O’Bannon’s victory. “Despite the holdings in O’Bannon v. NCAA,” Spielman’s attorney, Brian Duncan, writes, “. . . OSU has entered into various licensing partnerships that unlawfully utilize the images of Plaintiff and Class Members, by and through Defendant IMG College, and as further detailed herein.”

O’Bannon’s victory is persuasive authority in Ohio, but it is not binding precedent. In other words, a federal court in Ohio could decide that the O’Bannon ruling is wrong and rule against Spielman

Jurisdiction matters a great deal here.

O’Bannon won in the Ninth Circuit, which governs federal districts in nine states and two U.S. Pacific Islands: Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington, Guam and the Northern Mariana Islands. Colleges located in those locations must adhere to the Ninth Circuit’s 2015 ruling. However, in other parts of the country, including Ohio, colleges aren’t obligated to follow the Ninth Circuit. Rulings by different federal circuit courts govern those colleges. The Sixth Circuit, for example, governs federal districts in Kentucky, Michigan, Tennessee and, of relevance to Spielman’s lawsuit, Ohio.

II. Spielman’s lawsuit could be the first of many like it

Ohio State is obviously not the only college to “honor” former players with banners and apparel. Others have negotiated licensing deals, without players’ involvement, to depict those players. It would thus not be surprising to see “copycat” lawsuits filed by other former college athletes—whether they played football, basketball or another sport—against different colleges across the country. For many university legal counsels and athletic department compliance officers, there may be some busy days ahead.

As mentioned above, the U.S. Supreme Court declined to hear the O’Bannon case in 2016. This was not a major surprise. The Supreme Court only agrees to review about 1% of cases and regularly declines to hear cases that many people and industries regard as important. In order for the Supreme Court to agree to hear a case, at least four justices must vote to grant certiorari.

Still, some anticipated or at least hoped that the Supreme Court would be interested in the O’Bannon case since it impacted thousands of current athletes and former athletes, as well as many colleges, conferences, video game publishers, television networks and, of course, the NCAA itself. While the Supreme Court doesn’t explain why it declined to hear a case, it’s possible that the justices did not see a meaningful conflict between U.S. courts of appeals on the use of athletes’ names, images and likenesses. Indeed, O’Bannon’s victory in the Ninth Circuit has not been contradicted by a decision in a different federal circuit.

But play out the Spielman lawsuit for a moment. Let’s say he wins at the district court level but then loses on appeal to the U.S. Court of Appeals for the Sixth Circuit. Depending on the reasoning offered by the Sixth Circuit in ruling against Spielman, it’s possible that the Sixth’s ruling would conflict with the Ninth Circuit’s reasoning in the O’Bannon decision.

Spielman would then likely appeal to the U.S. Supreme Court, which would be faced with a conflict of legal interpretations of federal antitrust law between the Sixth Circuit and Ninth Circuit. Such a conflict wouldn’t guarantee that the Supreme Court agrees to hear Spielman’s case, but it would position Spielman’s case to have better odds of Supreme Court review than O’Bannon’s case since there would be an actual conflict.

The same logic applies if other former athletes file similar lawsuits to the one filed by Spielman. The more federal circuits disagree about how antitrust law ought to govern the licensing of current and former college athletes’ names, images and likenesses, the more likely the Supreme Court will eventually feel compelled to resolve the matter once and for all.

IV. Spielman’s lawsuit is not yet a federal class action

When a person files a lawsuit on behalf of both himself/herself and a group of other people, it is often reported as a “class action lawsuit.” A more accurate description would be that is is a potential class action lawsuit. A court must approve a lawsuit as a class action; it is not automatically one and doesn’t become one by declaration of the plaintiff.

In fact, it normally takes months, and sometimes years, for a plaintiff to convince a federal judge that the lawsuit contains enough common issues and other unifying features that would authorize the judge to bind other persons into the class. To illustrate, four years and nearly four months passed between the day O’Bannon filed his lawsuit and the day Judge Wilken certified part of O’Bannon’s putative class. To be sure, O’Bannon’s lawsuit was more extensive than Spielman’s in that it involved multiple sports and tens of thousands players from numerous colleges. Still, it might be some time before a court rules on whether Spielman’s lawsuit ought to be a class action.

To convince a federal court that he should represent a class of former and current OSU football players, Spielman will highlight that they all participated in the school’s football program and all have had their images sold or distributed by the defendants.

To counter that point, OSU and IMG College might assert that Spielman and other former OSU stars do not adequately represent the interests of most OSU football players. The vast majority of OSU football players were far less marketable than Spielman, a two-time All-American and winner of the 1987 Rotary Lombardi Award as college football’s top linebacker. Most OSU football players haven’t been as extensively marketed as has Spielman, a well-known public figure.

In response, Spielman might charge that everyone in his would-be class saw their names, images, and likenesses used without their consent. It should be noted that O’Bannon, recipient of the 1995 John Wooden Award as college basketball’s most outstanding player and a far more recognizable public figure than almost everyone else in his class, prevailed with such an argument in seeing his case certified.

OSU might also invoke the doctrine of sovereign immunity to assert that the university is immune from Spielman’s lawsuit. Under this doctrine, citizens can only sue the government or a government agency if it agrees to be sued. In certain circumstances, public universities can claim protection under sovereignty immunity on the theory that they are “arms” of the state government. Whether sovereign immunity would immunize OSU from athletes’ identity rights claims is uncertain.

V. Ohio State might be more poised to settle with Spielman than the NCAA was with O’Bannon

Many were surprised that the NCAA appeared uninterested in reaching a settlement with O’Bannon, who settled other claims with Electronic Arts. By not settling with O’Bannon, the NCAA had to comply with various pretrial discovery requests that led to damaging revelations about the NCAA’s business model. NCAA officials, including president Mark Emmert, also had to testify in O’Bannon’s trial.

At least part of the NCAA’s unwillingness to engage in substantive settlement talks reflected the high stakes of the O’Bannon case. Although O’Bannon v. NCAA centered on only one part of amateurism—the use players’ names, images and likenesses—it became perceived as a case where amateurism itself was on trial. That dynamic may have made it difficult for the NCAA to conceive of settlement terms that wouldn’t have been portrayed as a system loss.

For similar reasons, the NCAA may not wish to settle the ongoing litigation brought by Martin Jenkins and other players. Represented by Jeffrey Kessler and David Greenspan, Jenkins contends that the NCAA and colleges agreeing to cap the value of athletic scholarships to tuition, room, board, books and fees is an unlawfully anti-competitive practice. Jenkins demands that colleges financially compete for recruits just like they financially compete for coaches and financially compete in terms of quality of stadia and training facilities. In other words, athletic scholarships for star recruits would reflect competition between offers from top programs rather than fixed at a below-market value price. Judge Wilken, who ruled for O’Bannon, is the judge assigned to the Jenkins case, which could go to trial as soon as 2018.

Ohio State finds itself in an altogether different position from the NCAA. It doesn’t have a system to defend and it doesn’t have a philosophy to protect. If accepting a proposed settlement with Spielman makes more financial sense than litigating, and if the proposed settlement doesn’t cause Ohio State to breach NCAA rules, Ohio State will agree to the settlement. Similarly, IMG College is a business that centers on licensing deals. Whether college players are paid in some form or another in a licensing deal won’t change the core function of IMG College.

For their part, although Nike and Honda aren’t named defendants in Spielman’s lawsuit, they are listed as co-conspirators. Among other things, this means they would be subject to pretrial discovery requests in the event such requests are ordered. Nike and Honda could also later be added as co-defendants. For those reasons, Nike and Honda will probably encourage a settlement. Presumably, these companies would be content to pay college athletes so long as it makes business-sense and so long as it doesn’t jeopardize existing deals with the NCAA.

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