Corbett opposes NCAA's motion to dismiss federal antitrust complaint

By Jon Campisi | Feb 27, 2013

And so the legal wrangling between the NCAA and Pennsylvania Gov. Tom Corbett


Attorneys for the Corbett administration this week filed a memorandum of law in opposition to the defendant’s motion to dismiss the federal antitrust suit Corbett recently lodged against the National Collegiate Athletic Association relating to the sanctions levied on Penn State University following the Jerry Sandusky child sex-abuse scandal.

The lawsuit claims that the $60 million fine leveled at Penn State, and which was agreed to by the parties in a consent decree, violates federal antitrust laws, which have to do with anti-competitiveness.

The NCAA maintains that the suit is without merit, arguing in its earlier motion to dismiss that the governor is inappropriately attempting to drag the federal courts into an “intra-state political dispute.”

An NCAA lawyer had written in the association’s motion that the “remedial measures that Penn State agreed to were controversial, and have elicited strong feelings on all sides,” but that those feelings have nothing to do with antitrust laws.

In the governor’s memorandum in opposition to the dismissal motion, his attorneys wrote that the NCAA’s motion “repeatedly injects factual assertions that flatly contradict the well-pleaded allegations of the Complaint, and are improper to consider at this motion to dismiss stage of the proceedings.”

Plaintiff’s attorneys wrote that the most egregious example of this is the NCAA’s assertion in the beginning of its memorandum that Penn State’s governing board voted to ratify the consent decree between Penn State and the NCAA.

“This is not alleged in the Complaint, and it never occurred,” the governor’s filing states. “At a minimum, it raises material factual disputes that cannot be resolved on a motion to dismiss.”

The plaintiffs’ motion was signed by lawyers James D. Schultz and Jarad W. Handelman, of the Governor’s Office of General Counsel, as well as Cozen O’Connor attorneys Melissa H. Maxman and Ronald F. Wick.

The plaintiff’s memorandum also states that the NCAA’s motion contains a “great deal of rhetoric regarding both its motives and the economic impact of its actions.”

“These assertions also contradict the Complaint,” Corbett’s lawyers wrote. “The specific and well-pleaded allegations of the Complaint are more than sufficient to warrant denial of this motion to dismiss.”

The attorneys also took issue with the NCAA’s argument that the “unprecedented sanctions” against Penn State, including the hefty multi-million dollar fine, are not commerce.

“The NCAA wrongly claims that its arbitrary decimation of the PSU football program is no different than its enforcement of rules regulating player eligibility or uniforms – which do enhance collegiate competition – although PSU was not found to have violated a single NCAA rule and the NCAA’s own president insisted that the Consent Decree was not an enforcement action,” the plaintiff’s filing states.

Corbett’s lawyers wrote that the sanctions are also not “clearly precompetitive,” arguing that the NCAA merely used its enforcement authority as a pretext for an anticompetitive attack on Penn State, “as is evidenced by its abdication of its own enforcement process – which its memorandum never even attempts to defend.”

The governor’s attorneys wrote that the defendant’s argument that the commonwealth failed to allege anticompetitive effects is “similarly meritless.”

“The Commonwealth alleges conduct that constitutes a per se antitrust violation, or at least conduct that can be analyzed under a ‘quick look review,’” the plaintiff’s filing states. “Neither scenario necessitates a showing of a specific anticompetitive effect. Even if the rule of reason were applied, the Commonwealth has pleaded substantial anticompetitive effects in the form of higher prices, reduced output, and diminished quality.”

Corbett’s lawyers also wrote that despite an assertion to the contrary, the governor does, in fact, have standing to enjoin an antitrust violation targeted at the taxpayer-funded Pennsylvania State University, because there would be effects on the statewide economy.

“In trying to persuade the Court to endorse a remarkably expansive scope of its power, the NCAA’s memorandum appears to have been written more to advance the NCAA’s broad agenda, and to combat the recent groundswell of public criticism against the embattled organization, than to raise legal issues appropriate to a motion to dismiss,” the commonwealth’s filing states.

The sanctions levied on Penn State were in response to the child sex-abuse case against Jerry Sandusky, the former defensive coordinator for the Nittany Lions football team.

Sandusky was found guilty on 45 counts of child molestation following a jury trial in Centre County last June.

He was subsequently sentenced to between 30 and 60 years in state prison, although his lawyers are appealing the conviction to the state Superior Court.

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