The NCAA announced on July 17 that it will not be renewing its long-running licensing contract with the videogame maker Electronic Arts. The decision arrived as the organization faces a raft of lawsuits, including one brought by former UCLA player Ed O’Bannon, who is accusing the NCAA—and two co-defendants, the Collegiate Licensing Company and Electronic Arts—of profiting from his likeness. (That case awaits class-action status before trial.) “We are confident in our legal position regarding the use of our trademarks in video games,” the NCAA said in an official statement. “But given the current business climate and costs of litigation, we determined participating in this game is not in the best interests of the NCAA.” So “EA Sports NCAA Football 14,” the current iteration of the partnership, will be the last to bear the NCAA’s name and logo.
We spoke to Gabe Feldman, director of the sports law program at Tulane University Law School, for some perspective.
So what signal is the NCAA sending out by pulling out of the game?
The signals are unclear. But the practical implication is that the EA Sports game cannot use the NCAA’s name or logo. It doesn’t change anything beyond that—unless the Collegiate Licensing Company, which is essentially the licensing arm of the universities, or any of the individual schools, or EA Sports, decides to change the game. There is no indication yet that they will. The signal may simply be a recognition of the stakes of the litigation. When you have an antitrust lawsuit, the stakes are higher. It may just be that the NCAA will wait out the litigation and sacrifice the short-term revenue.
Does this decision affect its legal position, or that of the Collegiate Licensing Company or Electronic Arts—the co-defendants in the O’Bannon lawsuit?
It likely doesn’t change their exposure. Remember, the NCAA all along only licensed the rights to its name and logo. The NCAA didn’t have the ability to give them access to athlete likenesses. CLC would also add that they do not license the athlete’s name and likeness and make no claims to that. The NCAA’s dropping out just reduces their exposure going forward. But this is also the NCAA, at least in theory, severing its ties from this game to remove any future liability.
Aside from the obvious, what are the implications of the game itself?
The CLC certainly still has the right to license the names and marks of the schools [and Electronic Arts announced that they are moving forward for "College Football 15" with real teams and conferences]. The legal exposure is with the athlete’s likenesses and images. It may be, depending on how the case proceeds down the road, that EA decides to eliminate the use of realistic players from the game, and they can do that in many ways. There’s no indication they’re headed down that path. They certainly could generic-ize the players in the game, and return to the old school video game and play with anonymous players and real teams.
So what’s the takeaway?
I think the takeaway is that the NCAA does recognize that there is some risk. And it’s likely that they’re saying they’re willing to sacrifice short-term revenue from the game to avoid long-term damages and risks from the litigation. I think the overarching issue and the reason this may be a watershed case is not because former student-athletes may be entitled to a share of revenue from the NCAA video games. It’s more about whether this case can hammer away at the NCAA’s amateurism sheild. We’re a long way from that, but it has the potential to do that.
You’re talking about paying college players.
Right. If they can get payments for the use of their images for television, that will serve as a form of compensation.
So in the grand scheme, where do you put yesterday’s move on the part of the NCAA?
If this were a game of chess, this is the movement of a pawn. This is certainly not checkmate.
