In an interview with Bloomberg Television’s Erik Schatzker, Winston & Strawn’s sports lawyer Jeffrey Kessler discussed his just announced lawsuit against the NCAA on behalf of unpaid college football and basketball players. Kessler called the five top conferences a “cartel” that generates billions of dollars in revenue and illegally caps the pay of student athletes.
Jeffrey Kessler on Player Pay Lawsuit Against NCAA
Some Level of NCAA Reform Is Needed: Sutton
President of IMG College LLC, Ben Sutton responded to Kessler this morning and told Stephanie Ruhle that he “strongly” disagrees with Jeffrey Kessler’s lawsuit, “It is complete falsehood to go on camera and say that most of these kids don’t graduate. The reality is that student athletes on college campuses around the country graduate at a higher percentage than non-student athletes do…I would assert to you if you take out the fact that student athletes who leave college early and go professional will dilute your percentage.” Watch video: http://bloom.bg/OvUof6
American Athletic Conference Commissioner Mike Aresco responded to Kessler this morning and told Stephanie Ruhle: “I don’t think they will win. I hope they don’t. In the end, I think of scholarship is extremely valuable. There are other enhancements we are providing to student athletes. You do not have to go to these programs. You don’t have to go to college. It is a privilege to be a student athlete in that respect. The money that comes in funds a lot of programs that never warn a dime for the university and provide a lot of student athletes with opportunities that they would never have. In the end there is a slippery slope when people talk about paying players. I think the conversation becomes — we do not want to be simplistic here.”
**Interviews are part of today’s special edition of Bloomberg Television’s “Market Makers” with Erik Schatzker, Stephanie Ruhle and Matthew Miller, exploring the “The Bracket Business” — the value of the March Madness brand, the on and off-the court winners and losers, Wall Street CEO’s final four picks, and the debates around whether or not college athletes should be paid.
Jeffrey Kessler Transcript:
RUHLE: All right. Well, well ahead of filing that, Jeff Kessler sat down for an exclusive interview with my partner, Erik Schatzker. And he and Erik asked him what the case was really all about. Take a look.
Jeffrey Kessler, WINSTON & STRAWN: Right now, most of the players at the top level of football, at the top level of basketball help the schools earn billions of dollars, and what they end up with is virtually nothing in return. Most of them don’t graduate. None of them get financially compensated.
And almost none of them even have a professional career afterwards. So, they end up at the short end.
Erik Schatzker, Bloomberg News Anchor: The schools would argue that most, if not all of these athletes get scholarships. And there’s a value to the scholarship, depending on the school you’re at. It can be worth quite a lot of money. Why is that insufficient?
Jeffrey Kessler: The scholarships, the players, again, the athletic scholarships are not valuable if they don’t graduate and get the education that the scholarships are supposed to provide. What happens, if you look at the statistics, is most of these players are used by the schools to generate all of this money, and then they basically are discarded at the end of that process.
Schatzker: Who are you fighting for here ? Are you just fighting for the top football players and the top basketball players in collegiate America?
Jeffrey Kessler: This is about the big business of college sports. That has to do with the revenue generating sports. So, yes, we are focused on Division I men’s basketball and the top tier of college football. Having said that, most of the players in those sports are not stars. Most of the players in those sports never will have a professional career. So what we’re trying to do is create a system for thousands of players who are not stars.
Schatzker: Are you saying, though, that those who are stars will get paid and those who are not stars will not?
Jeffrey Kessler: No, what we expect what would happen in a free market is that players who are contributing will get a fair share, however that develops. One of the things we found in professional football, when we brought free agency there, is that the players who benefited the most, for example, were the offensive lineman, the work pail, everyday player, who was grossly under compensated for the contribution they were making.
Schatzker: If you win and these school have to start paying their athletes, what happens to the rest of their athletic programs that currently are funded by the revenue generated by football and basketball?
Jeffrey Kessler: There is nothing to stop the schools from continuing to fund those programs. That is a complete canard. No one expects all of the revenue to go to the athletes. That does not happen in any other sport. When you look at professional sports, the athletes get a share of the revenues. The rest will remain with the schools and the schools are free to use that in any way they want to, to support other sports, to support academics. Anything else. That is up to the schools. Maybe a little bit less will go to the coaches and the administrators, but that’s not unfair.
Schatzker: You talk about a future in which there’s a free market with talent at the collegiate level, and basketball and football at the very least are — those are the only sports that you care about for the moment. But what happens within that world? What if — surely, for example, the Auburns, the Dukes, the Louisvilles can afford players that small schools will not be able to afford. Do you really believe that there will be some equilibrium that the free market achieves whereby you can actually have a thriving league where people get paid by multiple teams, as many teams as exist right now in collegiate America?
Jeffrey Kessler: Right now there is no parity between Duke in basketball or Auburn in football and most of the other schools. The schools with the resources and the ability already attract all of the top players. Any fan who’s watching this knows there is no parity in college sports. There is no competitive balance in big-time basketball, football. Paying the athletes fairly will do nothing to worsen that situation —
Schatzker: Will it help —
Jeffrey Kessler: — and might actually help that situation because what we saw in the other professionals sports is that when you allowed for greater freedom and fairness to the athletes, you actually empowered some competitors to improve their situation. What is clear is under the current situation, there will never be any equity or parity under the current system.