10th Circuit NCAA Antitrust Ruling: Bars Athletes' Eligibility

• The 10th Circuit Court of Appeals reversed a lower court's decision, denying eligibility to college athletes for the upcoming season.
• The court ruled that the NCAA does not constitute a unique labor market, thereby defeating antitrust claims under the Sherman Act.
• Plaintiffs, led by Brock Wisne, challenged a new NCAA eligibility rule, arguing it restricted their ability to earn revenue from name, image, and likeness deals.
• The court found that college athletes are not employed by the NCAA, and individual university athletic programs, not all Division I schools, act as employers for market analysis.
• This decision establishes a significant 10th Circuit antitrust precedent, limiting future antitrust challenges against NCAA eligibility rules.

This 10th Circuit NCAA antitrust ruling establishes a significant precedent within the circuit, particularly regarding the viability of future antitrust challenges against the association's eligibility rules under the Sherman Act.

A recent 10th Circuit NCAA antitrust ruling has effectively barred a group of college athletes from competing in the upcoming season, overturning a lower court's decision that had granted them eligibility. The three-judge panel determined that the National Collegiate Athletic Association (NCAA) does not constitute a unique labor market, a finding that ultimately defeated the athletes' antitrust claims brought under the Sherman Act.

The legal challenge originated in July from a class action lawsuit led by former University of Northern Colorado basketball player Brock Wisne. These athletes, who had already completed four seasons, contested a new NCAA eligibility rule implemented in June 2026. This rule expanded eligibility from four seasons over five years to a simplified five seasons, streamlining previous provisions like athletic redshirting, medical hardship waivers, and COVID-19 extensions. The plaintiffs argued that the new rule, by excluding previously eligible players, illegally restrained trade within the NCAA Division I athletics labor market, thereby denying them an additional year of potential revenue from name, image, and likeness (NIL) deals. The 10th Circuit subsequently stayed a preliminary injunction and then reversed the lower court's ruling, allowing the NCAA to apply its new rule without exception to the plaintiff class.

Central to the 10th Circuit's decision was its interpretation of what constitutes a labor market for the purpose of antitrust analysis. The court defined a labor market as a network where employers' workers are considered "reasonably good substitutes," implying that any worker could earn income by working for any employer within that market. U.S. Circuit Judge Carolyn B. McHugh, a Barack Obama appointee, highlighted that the district court's initial finding, which hinged on the NCAA being the relevant employer for market definition, was "clearly erroneous."

The panel elaborated that the NCAA does not directly employ students as athletes; instead, students sign agreements with specific universities and their athletic programs. Furthermore, the court noted that not all universities offer the same sports, making it impossible for all Division I institutions to be considered "reasonably good substitutes" for athletes. For instance, out of 366 Division I universities, only 265 have football programs, and just 63 offer women’s gymnastics. This disparity led the court to conclude that individual athletic programs within a university, rather than all NCAA university members collectively, function as the employers for market-definition analysis. The court also disagreed with the plaintiffs' assertion that college athletics represents a unique labor market without comparable alternatives, siding with economist Matthew Backus, who has provided expertise in NCAA cases. Backus presented evidence that fewer underclassmen have entered the NBA and NFL drafts since the advent of NCAA name image likeness deals in 2021, suggesting athletes are extending their college careers due to these earning opportunities. This indicates that Division I sports can serve as a reasonable substitute for professional leagues, positioning the broader world of sports as the relevant market, not college athletics in isolation.

This 10th Circuit NCAA antitrust ruling establishes a significant precedent within the circuit, particularly regarding the viability of future antitrust challenges against the association's eligibility rules under the Sherman Act. The court's definitive stance that the NCAA does not operate as a unique college athlete labor market fundamentally alters the landscape for such claims. Without a plausible market definition, as Judge McHugh articulated, an antitrust challenge cannot progress to the subsequent analytical stages required by the rule of reason.

Lawyers advising college athletes or institutions on NCAA compliance and potential litigation should carefully consider this limitation on antitrust claims within the 10th Circuit. The ruling underscores the critical importance of precisely defining the relevant market in antitrust cases, especially when challenging the operational frameworks of large athletic organizations like the NCAA. The court's rejection of the broad "all Division I college athletics" market definition, emphasizing the distinct nature of individual university programs and the broader sports landscape, will likely influence how future antitrust litigation against the NCAA is framed in this jurisdiction.

This ruling establishes a precedent in the 10th Circuit that the NCAA is not a unique labor market, significantly impacting the viability of future antitrust challenges against its eligibility rules under the Sherman Act. Lawyers advising college athletes or institutions on NCAA compliance and potential litigation should note this limitation on antitrust claims in this circuit.

Source: Original reporting via Courthouse News Service