National Collegiate Athletic Assn. v. Alston

The rule of reason standard requires a court to engage in a fact specific inquiry of the market power and market structure to measure the competitive impact of restraints on competition and is required when the restraint at issue involves complex structures.

The NCAA appeals to the Court the lower court’s ruling that its education-related compensation and benefit restrictions for student-athletes violate section 1 of the Sherman Act. The NCAA claims that the courts below erred in its standard of review. The NCAA argues that the district court should have used an abbreviated deferential review, or quick view, to approve the restrictions rather than the rule of reason standard. The rule of reason standard requires a court to engage in a fact specific inquiry of the market power and market structure to measure the competitive impact of restraints on competition and is required when the restraint at issue involves complex structures. The Court found that the district court applied the correct standard—rule of reason—in evaluating the impact of the NCAA’s compensation and benefit restrictions available to student athletes. The Court’s reasoning was that the NCAA’s structure was too complex to permit a quick view review. Affirmed.