The U.S. Department of Justice (DOJ) has become a co-plaintiff in a civil antitrust lawsuit initiated by 10 state attorneys general, challenging the National Collegiate Athletic Association’s (NCAA) Transfer Eligibility Rule. The suit contends that the rule unreasonably inhibits college athletes from transferring to other colleges by limiting their eligibility to participate in intercollegiate sports and unfairly suppresses competition in the athletic services market.
A DOJ press release indicates that the original lawsuit was filed last month in the U.S. District Court for the Northern District of West Virginia by seven states. On December 14, after determining that the NCAA’s Transfer Eligibility Rule likely infringes Section 1 of the Sherman Act, the court granted a temporary restraining order on enforcing the rule at the request of these states. Last week, an amendment to the complaint added the United States, Minnesota, Mississippi, Virginia and the District of Columbia as plaintiffs.
According to Illinois Attorney General Kwame Raoul, one of the original plaintiffs in this case, under NCAA's current rule, college athletes who transfer between Division I schools are required to wait one year before competing in games. Although automatic exemptions were introduced for first-time transfers in 2021, Raoul says that subsequent transfers are still subject to this rule with waivers being rejected without legitimate reason.
The DOJ press release further clarifies that the amended complaint labels this one-time-transfer rule as anti-competitive; it alleges suppression of competition in athletic services market for men’s and women’s Division I basketball and Football Bowl Subdivision. The lawsuit also asserts that this rule curtails college athletes’ bargaining power.
Minnesota Attorney General Keith Ellison, who joined as a plaintiff last week, argues that NCAA’s Transfer Eligibility Rule restricts college athletes’ ability to sell their image and likeness and control their education. "Banning athletes from competing for a year after they transfer schools a second time is arbitrary, unjust, and in my opinion, illegal," Ellison stated in the press release.
