By Lauren McCoy & Rachel Mergenthal, Western Kentucky University, School of Kinesiology, Recreation and Sport
In October 2018, Los Angeles County Superior Court Judge Frederick Shaller issued a ruling that could impact the effectiveness of certain National Collegiate Athletic Association (NCAA) penalties. Judge Shaller ruled that “the NCAA’s show-cause penalty against [former University of Southern California (USC) assistant coach Todd] McNair violated California state law and declared the bylaws behind the penalty void because they’re an “unlawful restraint” (Fenno, 2018a). Section 16600 of California’s Business and Professions Code (1941) prohibits restraints on any contract where “anyone is restrained from engaging in a lawful profession, trade, or business of any kind.” A show-cause order that could potentially impact McNair’s employment as a college coach fits within this definition. Therefore, the legality of show-cause orders historically and in the future need to be considered for NCAA compliance considerations.
This ruling was made in connection to McNair’s claim for declaratory relief, an official judgment determining the rights of the parties (California Code of Civil Procedure §1060, 2017). McNair’s initial lawsuit leading to this claim for declaratory relief was a defamation lawsuit against the NCAA (Miller, 2018). He asserted that the harsh sanctions imposed on USC impacted opportunities for him to continue coaching at the collegiate level (Fenno, 2018). McNair received a one-year show-cause penalty in 2010 after the NCAA’s Committee on Infractions (COI) connected him to a series of violations committed by former USC football player, Reggie Bush. Bonagura (2018) highlighted that Bush received several impermissible extra benefits, including cash for travel expenses, a home for his parents in San Diego (where they allegedly lived rent free for over a year) and $10,000 to furnish the home. After investigation, the NCAA concluded that McNair “knew or should’ve known” about these illegal activities (Bonagura, 2018, p.3). This determination was the basis for McNair’s defamation lawsuit because he believed he was unfairly targeted with circumstantial evidence. McNair ultimately lost his case, but his claims did have some merit because he has not worked in college football since he received the one-year show-cause penalty (Fenno, 2018).
The show-cause order is used to hold individual coaches responsible for NCAA penalties beyond their connection to a particular university. Member institutions wishing to retain or hire individuals under show-cause orders must demonstrate “why it should not be subject to additional penalty for not taking appropriate disciplinary or corrective action with regard to an institutional staff member or representative” found in violation of NCAA bylaws (NCAA, 2018, p. 335). This penalty does not forbid a university from hiring or retaining a coach during this time but is often used a reason to dismiss a coach due to the negative implications associated with the order (Auerbach, 2014).
While the NCAA is likely to appeal this ruling to a higher court, there are questions about the impact on college sports in California and beyond if affirmed. Larry Scott, commissioner of the Pacific-12 conference, stated in sworn testimony that the ruling could prevent California member institutions from honoring the requirements of NCAA membership, a move that could lead to their removal from athletic participation (Kirshner, 2018). There are 24 NCAA Division I member institutions in California (NCAA, 2018a). Should the ruling stand, coaches receiving show-cause orders could be hired or retained by any California member institution without demonstrating mitigating factors. Miller (2018) argued that this ruling provides a roadmap for other coaches currently under show-cause penalties. Those individuals could challenge the NCAA based on their own state antitrust statutes and common law.
This is not the first time penalized coaches argued that the NCAA’s show-cause order violates state or federal law. Jerry Tarkanian, former head men’s basketball coach at the University of Nevada — Las Vegas (UNLV), accused the NCAA of violating his due process rights under the Fourteenth Amendment of the United States Constitution when he was suspended by the University (NCAA v. Tarkanian, 1988). UNLV’s decision to suspend Tarkanian stemmed from an NCAA show-cause order after an investigation into improper recruiting practices. Neither the NCAA nor the COI can sanction the employee of a member institution directly. However, the bylaws provide that member institutions “are expected to cooperate fully” with the enforcement of NCAA rules and potential penalties (NCAA v. Tarkanian, 1988, p. 184).
The United States Supreme Court, in a 5-4 ruling, found that UNLV’s conduct was motivated by the NCAA, but felt that the university retained the ultimate power to suspend or keep Tarkanian. The NCAA’s power here is to threaten sanctions with the university choosing to comply. UNLV could ignore the recommendations of the NCAA if they choose, minimizing the influence of the private actor on state action. Therefore, the NCAA was not considered a state actor and is not subject to Constitutional law.
The precedent set in Tarkanian gave the NCAA some distance from the impact of show-cause orders. These orders are often seen as merely suggestions and provide institutions with the ultimate decision-making authority regarding the individual’s employment status. When Timothy Cohane challenged the show-cause order that led to his resignation from his position as the head coach of the men’s basketball team at the State University of New York — Buffalo, the Second Circuit Court of Appeals ruled there was no evidence of state action stemming from the NCAA’s involvement, a result similar to the Supreme Court’s decision in Tarkanian. “To show that a private entity acted as a state actor through joint activity with the state, a plaintiff must show that the private entity and the state ‘share[d] some common goal to violate the plaintiff’s rights’” (Cohane v. NCAA, 612 Fed. Appx. 41, 2d Cir. 2015, p. 44 citing Betts v. Shearman, 751 F.3d 78, 2d. Cir. 2014, p. 85). Once again, the court here asserted the university’s free will to ignore or abide by the recommendation within the show-cause order. Essentially, these courts have treated show-cause orders as suggestions that the university does not have to follow even though it could impact membership in the NCAA.
Show-cause orders have also been challenged as a violation of antitrust law. In Bassett v. NCAA, the Sixth Circuit Court of Appeals found that the NCAA did not violate antitrust law with their show-cause order. Claude Bassett, former football assistant coach at the University of Kentucky argued that the show-cause discipline “affects interstate commerce by preventing schools across America from hiring boycotted coaches to generate sports revenue and by preventing these coaches from seeking gainful employment with NCAA institutions” (Bassett v. NCAA, 6th Cir. 2008, p. 431 citing Final Reply Brief of Plaintiff — Appellant, p. 6-7). The Sixth Circuit ruled in favor of the NCAA because the show-cause order stemmed from recruiting violations that are non-commercial in nature, meaning there is no anticommercial effect present to violate antitrust law (Bassett v. NCAA, 2008).
The Ninth Circuit Court of Appeals, which includes the state of California, recently criticized the result in Bassett declaring that rules related to improper benefits have a commercial nature. “Rules that are ‘anti-commercial and designed to promote and ensure competitiveness’ surely affect commerce just as much as rules promoting commercialism” (O’Bannon v. NCAA, 9th Cir. 2015, p. 1066 citing Bassett v. NCAA, 6th Cir. 2008, p. 433). While Bassett lost his antitrust claim for failing to prove that improper inducement rules have a commercial effect, this ruling in O’Bannon v. NCAA works in Todd McNair’s favor. His show-cause order was based on improper inducements similar to those leading to Bassett’s show-cause order and subsequent unemployment. Any appeal of Judge Shaller’s initial ruling, however, would be challenged in state court, not the federal court system which includes the Ninth Circuit. But the ruling in O’Bannon could be viewed as precedent for affirming Judge Shaller’s decision in a California appellate court.
Previous challenges to the NCAA’s show-cause order have been unsuccessful, but the McNair case could signal the shift in that precedent. Was USC’s decision to not retain McNair’s contract solely based on this one-year show-cause order? What about other NCAA member institutions? At this point, the one-year penalty from 2010 has passed but McNair is still unable to find employment in college football. An argument could be made that the continued stigma associated with the former show-cause order is the impetus behind his employment issues. Therefore, if the show-cause order ultimately functions as a negative warning or scarlet letter on each institution, then the university does not maintain the decision-making authority necessary to avoid a violation of both state and federal law.
On the other hand, the show-cause order does not always carry negative connotations, especially once the penalty expires. Several head coaches who were given show-cause orders were hired by other institutions when those penalties expired. Bruce Pearl and Kelvin Sampson, who had three and five-year show-cause orders respectively, were both hired as the head coach of a Division I men’s basketball program in 2014. Pearl had five months remaining on his show-cause order which barred him from recruiting activities when he was hired by Auburn University (Auerbach, 2014). Unfortunately, assistant coaches like McNair tend to become the scapegoat in these situations and are rarely afforded the second chances given to head coaches like Pearl and Sampson. That decision is still being freely made by a university, meaning that no violation of the law is present.
The ultimate impact of Judge Shaller’s ruling will depend on the success of an appeal. If the ruling is affirmed, the NCAA may need to revisit these orders. However, NCAA sanctions still carry heavy influence. A university facing sanctions may not wish to challenge the COI’s decision for fear of further punishments directed at the university. Additionally, the reputation and stigma against individuals associated with NCAA violations could continue even if show-cause penalties are found illegal. The NCAA should not attempt to issue individual punishments or negotiate punishments with member institutions as a way to work around show-cause orders. These punishments would have to be enforced by the same member institutions that could potentially ignore a show-cause order and any negotiated agreement will likely be viewed as joint action in violation of the law.
References
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O’Bannon v. National Collegiate Athletic Association, 802 F. 3d 1049 (9th Cir. 2015).
