Over the past six years, we’ve lived in the wild west as collegiate sports has wrestled with how to compensate college athletes, whether with NIL, through collectives or by schools directly sharing revenue with their student athletes without actually defining their employment status.

Employee status has been a sticking point with the SCORE Bill, which has met partisan gridlock in Washington, partly because it precludes student athletes from being employees.

An ongoing federal case, Johnson v. NCAA, which began in 2019, will go to court on Tuesday and could restate the economic relationship between athletes and their schools.

Sportico has a very detailed story you can read here about a case that could redefine student-athletes as student-employees.

The presiding judge has asked the parties to explain their “efforts” to reach a settlement.

If the parties don’t reach settlement, and the case advances, Sportico reports, “the case will progress toward potential pre-trial discovery that would be much more invasive than what schools faced in House v. NCAA and other antitrust litigation. And if Johnson goes to trial and the athletes win, the NCAA and member schools could be on the hook to pay billions of dollars in damages.”

But the consequences could go way beyond past damages and lead to players being deemed student employees which could lead to collective bargaining, a concept that once was unpopular in athletics but has gained momentum as the SCORE bill hit gridlock in Washington.

Sportico defines the Johnson argument as “remarkably straightforward.”

In the event you are unable to read the full article, which we recommend, here are a number of the key points they make.

Johnson argues student athletes are employees within the meaning of the Fair Labor Standards Act (FLSA) and accompanying state minimum wage laws.

The athletes maintain they meet this test.

They point out that interscholastic athletics aren’t part of any academic curriculum or course and aren’t conducted for academic credit.

Further, the life and career skills obtained through college sports are depicted as the kind found in work environments.

The athletes also insist that they perform services for the benefit of colleges, which collectively generate billions of dollars a year through athletics and, as U.S. Supreme Court Justice Brett Kavanaugh detailed in NCAA v. Alston, pay coaches and administrators considerable salaries and build “lavish new facilities” while under the control of their colleges, including when they pick courses.

The athletes underscore how colleges provide the “tools and means,” such as training, equipment and preventative care, needed for them to play NCAA sports, which allegedly resemble the “in-kind compensation provided by pro sports teams to pro athletes” and are consistent with employment.

The athletes insist they aren’t independent contractors or volunters who “would have to cover” their expenses “out of pocket.” The athletes can’t switch schools for a new gig like an independent contractor.

In briefs urging Pavoda to dismiss the lawsuit, the NCAA and defendant colleges argue the athletes are too imprecise in their allegations.

The NCAA and Colleges’ defense

Sportico notes that the defendants draw from a concurring opinion by Third Circuit Judge David Porter in Johnson. He surmised that the athletes describe “student-athletes generally” without sufficiently explaining “their own, individual circumstances.” Those include distinctions between very lucrative forms of college sports, like March Madness or power conference football, and less prominent athletics, such as fencing and many other sports.

Drawing from the concurring opinion, the NCAA asserts that college athletes play sports for different reasons, including “predominantly recreational or noncommercial reasons and that each athlete must speak to their own experiences.”

The defendants charge the Johnson athletes fail to specifically plead “that his or her sport was profitable for his or her school, let alone that his or her participation in that sport helped to generate revenue, increase alumni engagement, or otherwise confer benefits on that Plaintiff’s school.”

The defendants contend the complaint should clarify whether each athlete is a “heavily recruited star player who started every game and attracted substantial public interest” or a “walk-on who was not recruited, saw little to no playing time, or drew no attention at all.”

The NCAA and colleges also insist the athletes should explain how college athletics interfered with their studies. At the same time, they argue that interference with studies is not necessarily indicative of a student employment relationship since “myriad college activities — such as orchestras, dance teams, theater groups, or student-run publications like newspapers and literary magazines” are “not compensable work.”

Sportico reported that because Padova forcefully denied the defendants’ previous motion to dismiss, there’s a good chance Padova will issue another denial this time around. The NCAA could then seek another interlocutory appeal—meaning an appeal of a case before it is decided—to the Third Circuit, but those petitions are rarely granted, and the NCAA might not get a second bite at the apple.

A denial by Padova would move the case into another phase where the judge will determine if the case should become a class action—possibly on behalf of all Division I college athletes dating back to 2016 or 2017—and oversee pretrial discovery.

This is an FLSA case, not an antitrust case.

NCAA antitrust litigation has involved big money topics often protected by trade secrets, including billion-dollar broadcasting deals. Johnson’s FLSA litigation, in contrast, is about college athletes as student employees earning the applicable minimum wage.

That matters, Sportico reports, because FLSA discovery is more public-facing and would necessitate college officials, coaches and staff having to share time sheets, practice schedules, on-field activities notes and other materials relevant to student employment. Those officials would also have to answer questions under oath, and their responses would be fair game for public scrutiny.

Should Johnson advance, college administrators would also have work, issuing notice obligations under the Family Education Rights and Privacy Act to alert current and former students who played sports they are potential members of a proposed class action.

Like House, Johnson could settle at some point, with a settlement paying many thousands of former and current college athletes and changing rules to acknowledge them as student employees. The alternative is to gamble the courts will side with the NCAA. That hasn’t been a good bet of late.

For years, the NCAA and collegiate athletics directors who are opposed to the concept of athletes as employees have been in a sprint to secure federal legislation banning them from being employees before a case like Johnson reaches court and a judge decides the matter for them.

A number of influential figures in college sports appear to believe student employment, as sought in Johnson, is the correct approach, especially with the SCORE Bill meeting partisan gridlock in Washington.

“I don’t understand why everyone’s so afraid of employment status,” Tennessee athletic director Danny White told ESPN in December. “We have kids all over our campus that have jobs. … We have kids in our athletic department that are also students here that work in our equipment room, and they have employee status. How that became a dirty word, I don’t get it.”

Sportico concludes - “While Alston and House altered the economic landscape of college sports, it’s Johnson that could re define what it means to be a college athlete in America.”