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Nos. 19-15566, 19-15662
IN THE

United States Court of Appeals
FOR THE NINTH CIRCUIT
IN RE: NATIONAL COLLEGE ATHLETIC ASSOCIATION GRANT-IN-AID CAP ANTITRUST
LITIGATION

SHAWNE ALSTON, ET AL.,
Plaintiffs-Appellees-Cross-Appellants,
v.
NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL.,
Defendants-Appellants-Cross-Appellees.

On Appeal from the United States District Court for the Northern District of
California, No. 14-md-2541 (Wilken, J.)
Motion of the Open Markets Institute, Change to Win, the National
Employment Law Project, and Economics and Law Professors for Leave to
File Amici Curiae Brief in Support of Plaintiffs-Appellees-Cross-Appellants

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EMMA REBHORN
CHANGE TO WIN
90 Broad Street, Suite 710
New York, NY 10004
973-951-6281

NAJAH A. FARLEY
NATIONAL EMPLOYMENT LAW PROJECT
90 Broad Street, Suite 1100
New York, NY 10004
646-693-8225

SANDEEP VAHEESAN
Counsel of Record
OPEN MARKETS INSTITUTE
1440 G Street, NW
Washington, D.C. 20005
301-704-4736
vaheesan@openmarketsinstitute.org

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INTRODUCTION
Pursuant to Federal Rule of Appellate Procedure 29(a), the amici curiae
respectfully move for leave to participate in the above-captioned case in support of
the plaintiffs, and to file their brief, provided herewith. The amici curiae
endeavored via email to obtain the consent of all parties to the filing of the brief.
The plaintiffs’ counsel consented to the filing of the brief, and the defendants’
counsel did not reply to the request for consent.
I
BACKGROUND
On March 8, 2019, the district court delivered an incomplete victory for the
plaintiffs—current and former college basketball and football players who have
generated billions in revenues for the National College Athletic Association
(NCAA). As sellers of their athletic services, they allege that the NCAA, acting on
behalf of member colleges and universities, illegally colluded to deny them
competitive compensation for their hard work and talents.
The district court held the NCAA liable but adopted an overly narrow
remedy. It found that the plaintiffs made a prima facie showing that the NCAA’s
restrictions on compensating college athletes is a restraint of trade. The court,
however, allowed the defendants to rebut this showing by asserting that the
restraint yielded benefits to other groups, including viewers of college sports.

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While the district court rejected most of the defendants’ justifications, it concluded
that the restraints did stimulate demand for college sports because viewers valued
these athletics, in part, because the players are not competitively compensated. In
crediting this justification, the district court enjoined only a sliver of the
defendants’ restraints of trade—specifically those that capped payments made to
players related to their education expenses.
Plaintiffs allege that the defendants violated Section 1 of the Sherman Act,
15 U.S.C. § 1. They seek injunctive relief to ensure that college athletes will
receive competitive compensation for the skills and hard work, which they have
long been denied due to defendants’ collusive conduct.
II
INTEREST OF PROPOSED AMICI CURIAE AND RELEVANCE
The Open Markets Institute is a non-profit organization dedicated to
promoting fair and competitive markets. It does not accept any funding or
donations from for-profit corporations. Its mission is to safeguard our political
economy from concentrations of private power that undermine competition and
threaten liberty, democracy, and prosperity. The Open Markets Institute regularly
provides expertise on antitrust law and competition policy to Congress, federal
agencies, courts, journalists, and members of the public.

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Change to Win (CTW) is a democratic federation of labor unions
representing millions of working people. The organization strives to ensure that
every worker has a living wage, benefits to support their family and dignity in
retirement. CTW advocates not just for jobs, but for good jobs: safe, equitable
workplaces where all employees meaningfully participate in the decisions affecting
their employment. CTW believes that robust antitrust enforcement and regulation
can bring more equity to the balance of power between working people and those
who profit from their labor.
The National Employment Law Project (NELP) is a non-profit organization
with 50 years of experience advocating for the employment and labor rights of
workers. NELP seeks to ensure that all workers receive the full protection of labor
and employment laws. NELP prioritizes workplace equity and opposes
interpretations of the labor laws that privilege corporate profits over the rights of
workers. NELP has litigated and participated as amicus curiae in numerous cases
in circuit and state courts and the U.S. Supreme Court addressing the importance of
equal access to labor law protections for all workers.
Marshall Steinbaum is Assistant Professor of Economics at the University of
Utah. He studies market power in labor markets and its policy implications,
including for antitrust and competition policy. His work has appeared in the
Journal of Economic Literature, Industrial and Labor Relations Review, University
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of Chicago Law Review, and Law and Contemporary Problems. He is also an
editor of After Piketty: The Agenda for Economics and Inequality, which was
published in 2017. He earned a PhD in Economics from the University of Chicago
in 2014.
Sanjukta Paul is Assistant Professor of Law at Wayne State University. She
studies the role of labor and workers in antitrust law, and teaches in the areas of
labor, corporations, and antitrust law. Her work has appeared or is forthcoming in
the UCLA Law Review, Berkeley Journal of Labor & Employment Law, Law and
Contemporary Problems, and The Cambridge Handbook of U.S. Labor Law for the
Twenty-First Century, and has been recognized with the Jerry S. Cohen Award for
Antitrust Scholarship (category prize, 2016). She earned her JD from Yale Law
School and completed a judicial clerkship on the Ninth Circuit Court of Appeals.
Veena Dubal is an Associate Professor of Law at the University of
California, Hastings College of Law. Her research focuses on the intersection of
law, technology, and precarious work. She has been cited by the California
Supreme Court, and her scholarship has been published in top-tier law review and
peer-reviewed journals.
Amici respectfully submit that the decision of district court undermines the
Sherman Act’s protection of workers and other sellers from purchasers’ restraints

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of trade. As such, the amici curiae move for leave to file the accompanying brief in
support of Plaintiffs’ cross-appeal.
The Sherman Act protects sellers of goods and services from powerful
purchasers. In enacting the Sherman Act, Congress aimed to safeguard the freedom
of workers, farmers, and other sellers from monopolies and trusts. See Gregory J.
Werden, Monopsony and the Sherman Act: Consumer Welfare in a New Light, 74
Antitrust L.J. 707, 714 (2007) (“The legislative history leaves no doubt that
Congress intended to protect sellers victimized by trusts and other conduct within
the scope of the Sherman Act’s prohibitions.”). Senator Sherman declared that
trusts and monopolies “regulate prices at their will, depress the price of what they
buy and increase the price of what they sell.” 21 Cong. Rec. 2461 (1890).
In accordance with this legislative intent, the Supreme Court, since the early
years of the Sherman Act, consistently has held that the law protects sellers from
restraints of trade and monopolistic practices. In Swift & Co. v. United States, 196
U.S. 375 (1905), the Supreme Court affirmed a district court’s finding of liability
against stockyard owners that had collusively suppressed the price of cattle paid to
ranchers. The Court in a subsequent buyer-side price-fixing case made clear that
the Sherman Act protects both purchasers and sellers. See Mandeville Island
Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 236 (1948) (“The
[Sherman Act] does not confine its protection to consumers, or to purchasers, or to
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competitors, or to sellers.”). It stated, “The Act is comprehensive in its terms and
coverage, protecting all who are made victims of the forbidden practices by
whomever they may be perpetrated.” Id. (emphasis added).
In effectuating the Sherman Act’s protection of multiple classes of economic
actors, the courts should look only at a restraint’s effects on the plaintiffs and
should not “sacrifice competition in one portion of the economy for greater
competition in another portion[.]” United States v. Topco Associates, Inc., 405 U.S.
596, 611 (1972). Accordingly, the rule of reason is restricted to a challenged
restraint’s costs and benefits for only the injured class. The rule of reason is
circumscribed. See National Society of Professional Engineers v. United States,
435 U.S. 679, 688 (1978) (“Contrary to its name, the Rule does not open the field
of antitrust inquiry to any argument in favor of a challenged restraint that may fall
within the realm of reason. Instead, it focuses directly on the challenged restraint's
impact on competitive conditions.”). In the wake of National Society of
Professional Engineers, a court of appeals, in applying the rule of reason to a
labor-market facing restraint in professional sports, rejected an unbounded rule of
reason. Smith v. Pro Football, Inc., 593 F.2d 1173, 1186 (D.C. Cir. 1978).
From an institutional perspective, the courts are ill-equipped to engage in a
broad cost-benefit analysis through the rule of reason. The Supreme Court
recognized that such balancing requires the evaluation of numerous
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considerations—a task more appropriate for legislators than judges. United States
v. Topco Associates, Inc., 405 U.S. 596, 611-12 (1972). At a fundamental level,
this type of balancing calls for judgments that the courts should not make and
should instead leave to democratically accountable legislatures. See id. at 612
(“[T]o make the delicate judgment on the relative values to society of competitive
areas of the economy, the judgment of the elected representatives of the people is
required.”).
Under the district court’s articulation of the rule of reason, firms with market
power can inflict harms on sellers through restraints of trade and monopolization
and defend themselves by showing benefits to another group—consumers, for
example. This type of balancing sacrifices sellers’ right to a fair marketplace in
order to serve buyers. The court gave powerful purchasers significant freedom to
disempower workers and other sellers through restraints of trade so long as they
show offsetting gains to consumers or another group. As such, firms are permitted
to maintain their buy-side restraints in partial or full measure.
In this case, the results are especially indefensible. The expansive rule of
reason “leads to the abhorrent result of allowing purchasers of labor to unlawfully
exploit one class of people (in this case, predominantly African American college
athletes) for the purpose of benefiting another, presumably a more important class
of people (the consumers of college athletics, in particular the viewers of televised
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men's football and basketball games).” Tibor Nagy, The “Blind Look” Rule of
Reason: Federal Courts’ Peculiar Treatment of NCAA Amateurism Rules, 15
Marq. Sports L. Rev. 331, 366-67 (2005).
In evaluating the challenged restraint, the district court should have confined
its rule of reason analysis to the effects on college athletes—and no other group.
Once the plaintiffs established their prima facie case, the district court should have
considered only the presumptively illegal restraint’s offsetting benefits to the
college athletes themselves. The NCAA’s proffered benefits to other groups, such
as viewers of college sports, should have been disregarded. This cabined approach
ensures that the Sherman Act protects sellers, such as the plaintiffs, from
purchasers’ restraints of trade.
III
DESIRABILITY OF PARTICIPATION
The district court’s application of the rule of reason undermines the Sherman
Act’s protection of workers and other sellers of services and goods. Under the
district court’s rule of reason, firms with market power can inflict harms on sellers
through restraints of trade and monopolization and minimize and even escape
liability by showing benefits to another group—consumers, for example. The court
gave powerful purchasers significant freedom to disempower workers and other

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sellers through restraints of trade so long as they show offsetting gains to
consumers or another group.
The amici curiae brief will not duplicate arguments made by the parties. It
will instead provide distinct perspectives on the issues facing the Court.
CONCLUSION
For these reasons, amici respectfully request leave to file the accompanying
brief in support of the plaintiffs’ cross-appeal.
DATED: OCTOBER 30, 2019

Respectfully submitted,
/s/ Sandeep Vaheesan

EMMA REBHORN
CHANGE TO WIN
90 Broad Street, Suite 710
New York, NY 10004
973-951-6281

SANDEEP VAHEESAN
OPEN MARKETS INSTITUTE
1440 G Street, NW
Washington, D.C. 20005
301-704-4736
vaheesan@openmarketsinstitute.org

NAJAH A. FARLEY
NATIONAL EMPLOYMENT LAW PROJECT
90 Broad Street, Suite 1100
New York, NY 10004
646-693-8225
Counsel for Amici Curiae

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CERTIFICATE OF SERVICE
I hereby certify that on this date, I caused a true and correct copy of the
foregoing to be served on counsel of record for all parties via ECF.
/s/ Sandeep Vaheesan
Sandeep Vaheesan
Counsel for Amici Curiae

Dated: October 30, 2019

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Nos. 19-15566, 19-15662
IN THE

United States Court of Appeals
FOR THE NINTH CIRCUIT
IN RE: NATIONAL COLLEGE ATHLETIC ASSOCIATION GRANT-IN-AID CAP ANTITRUST
LITIGATION

SHAWNE ALSTON, ET AL.,
Plaintiffs-Appellees-Cross-Appellants,
v.
NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL.,
Defendants-Appellants-Cross-Appellees.

On Appeal from the United States District Court for the Northern District of
California, No. 14-md-2541 (Wilken, J.)
Brief Amici Curiae of the Open Markets Institute, Change to Win, the
National Employment Law Project, and Economics and Law Professors in
Support of Plaintiffs-Appellees-Cross-Appellants

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EMMA REBHORN
CHANGE TO WIN
90 Broad Street, Suite 710
New York, NY 10004
973-951-6281

NAJAH A. FARLEY
NATIONAL EMPLOYMENT LAW PROJECT
90 Broad Street, Suite 1100
New York, NY 10004
646-693-8225

SANDEEP VAHEESAN
Counsel of Record
OPEN MARKETS INSTITUTE
1440 G Street, NW
Washington, D.C. 20005
301-704-4736
vaheesan@openmarketsinstitute.org

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CORPORATE DISCLOSURE STATEMENT
Pursuant to Fed. R. App. P. 26.1, the Open Markets Institute, Change to
Win, and the National Employment Law Project state that they are non-profit
corporations and, as such, no entity has any ownership interest in them.

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TABLE OF CONTENTS

CORPORATE DISCLOSURE STATEMENT ..................................................... i
TABLE OF AUTHORITIES ................................................................................ iii
INTEREST OF AMICI CURIAE............................................................................1
SUMMARY OF ARGUMENT ...............................................................................3
ARGUMENT ............................................................................................................9
1. The Sherman Act Protects Workers and Other Sellers from Purchasers’
Restraints of Trade and Monopolistic Practices ................................................9
II. The District Court’s Application of the Rule of Reason Subverts the
Sherman Act’s Protection of Workers and Other Sellers ..............................13
A. The District Court’s Application of the Rule of Reason Subordinates
Sellers’ Interests to Consumers’ Interests .....................................................14
B. The Supreme Court Has Directed the Lower Courts Not to Engage in
Open-Ended Cost-Benefit Analysis Under the Rule of Reason ..................16
III. The District Court Should Have Considered Only the Restraint’s Harms
and Benefits in the Market for College Athletes’ Services .............................20
CONCLUSION.......................................................................................................21
CERTIFICATE OF COMPLIANCE ..................................................................23
CERTIFICATE OF SERVICE ............................................................................24

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TABLE OF AUTHORITIES
Cases
Apple Inc. v. Pepper, 139 S.Ct. 1514, 1525 (2019) .............................................5, 12
California ex rel. Harris v. Safeway, Inc. 651 F.3d 1118, 1132 (9th Cir. 2011) .. 13,
17
Continental T.V., Inc. v. GTE Sylvania Inc., 433 U.S. 36, 54-59 (1977) ................17
Knevelbaard Dairies v. Kraft Foods, Inc., 232 F.3d 979, 988 (9th Cir. 2000) 13, 21
Larry V. Muko, Inc. v. Southwestern Pennsylvania building & Construction Trades
Council, 670 F.2d 421, 439 (3d Cir. 1982)...........................................................18
Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877, 890-94, 907
(2007) ....................................................................................................................17
Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 236
(1948) ..................................................................................................... 3, 5, 11, 21
National Collegiate Athletic Ass’n v. Bd. Of Regents of Univ. of Okla., 468 U.S.
85, 101-02 (1984) ...................................................................................................4
National Society of Professional Engineers v. United States, 435 U.S. 679, 688
(1978) ..................................................................................................... 4, 6, 14, 17
O’Bannon v. National Collegiate Athletic Ass’n, 802 F.3d 1049, 1063-64 (9th Cir.
2015) .......................................................................................................................4
Radovich v. National Football League, 352 U.S. 445, 453-54 (1957) ....................11
Reid Bros. Logging Co. v. Ketchikan Pulp Co., 699 F.2d 1292, 1307 (9th Cir.
1983) .....................................................................................................................13
Smith v. Pro Football, Inc., 593 F.2d 1173, 1186 (D.C. Cir. 1978) ......... 6, 7, 17, 19
Swift & Co. v. United States, 196 U.S. 375 (1905)..............................................5, 11
United States v. Philadelphia National Bank, 374 U.S. 321, 371 (1963) ...............18
United States v. Topco Associates, Inc., 405 U.S. 596, 611-12 (1972) ... 6, 7, 16, 18,
19, 20
Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co., 549 U.S. 312, 320
(2007) ....................................................................................................................12
Other Authorities
Daniel A. Crane, Balancing Effects Across Markets, 80 Antitrust L.J. 397, 409-10
(2015) ....................................................................................................................18
David Millon, The Sherman Act and the Balance of Power, 61 S. Cal. L. Rev.
1219, 1226 (1988) ...................................................................................................9
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Gregory J. Werden, Monopsony and the Sherman Act: Consumer Welfare in a New
Light, 74 Antitrust L.J. 707, 714 (2007) .............................................................3, 9
John B. Kirkwood, The Essence of Antitrust: Protecting Consumers and Small
Suppliers from Anticompetitive Conduct, 81 Fordham L. Rev. 2425, 2435 (2013)
...............................................................................................................................10
Rebecca Haw Allensworth, The Commensurability Myth in Antitrust, 69 Vand. L.
Rev. 21-22 (2016) .................................................................................................18
Tibor Nagy, The “Blind Look” Rule of Reason: Federal Courts’ Peculiar
Treatment of NCAA Amateurism Rules, 15 Marq. Spors L. Rev. 331, 366-67
(2005) ................................................................................................................8, 16
Legislative Materials
21 Cong. Rec. 1768 (1890) ......................................................................................10
21 Cong. Rec. 2157 (1890) ......................................................................................10
21 Cong. Rec. 2461 (1890) ..................................................................................3, 10
21 Cong. Rec. 2470 (1890) ......................................................................................11
21 Cong. Rec. 4098 (1890) ......................................................................................10

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INTEREST OF AMICI CURIAE1
The Open Markets Institute (OMI) is a non-profit organization dedicated to
promoting fair and competitive markets. It does not accept any funding or
donations from for-profit corporations. Its mission is to safeguard our political
economy from concentrations of private power that undermine fair competition
and threaten liberty, democracy, and prosperity. OMI regularly provides expertise
on antitrust law and competition policy to Congress, federal agencies, courts,
journalists, and members of the public.
Change to Win (CTW) is a democratic federation of labor unions
representing millions of working people. The organization strives to ensure that
every worker has a living wage, benefits to support their family and dignity in
retirement. CTW advocates not just for jobs, but for good jobs: safe, equitable
workplaces where all employees meaningfully participate in the decisions affecting
their employment. CTW believes that robust antitrust enforcement and regulation
can bring more equity to the balance of power between working people and those
who profit from their labor.

1

No parties oppose the filing of this brief, and no counsel for any party authored
this brief in whole or part. Apart from amici curiae, no person contributed money
intended to fund the brief’s preparation and submission.
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The National Employment Law Project (NELP) is a non-profit organization
with 50 years of experience advocating for the employment and labor rights of
workers. NELP seeks to ensure that all workers receive the full protection of labor
and employment laws. NELP prioritizes workplace equity and opposes
interpretations of the labor laws that privilege corporate profits over the rights of
workers. NELP has litigated and participated as amicus curiae in numerous cases
in circuit and state courts and the U.S. Supreme Court addressing the importance of
equal access to labor law protections for all workers.
Marshall Steinbaum is Assistant Professor of Economics at the University of
Utah. He studies market power in labor markets and its policy implications,
including for antitrust and competition policy. His work has appeared in the
Journal of Economic Literature, Industrial and Labor Relations Review, University
of Chicago Law Review, and Law and Contemporary Problems. He is also an
editor of After Piketty: The Agenda for Economics and Inequality, which was
published in 2017. He earned a PhD in Economics from the University of Chicago
in 2014.
Sanjukta Paul is Assistant Professor of Law at Wayne State University. She
studies the role of labor and workers in antitrust law, and teaches in the areas of
labor, corporations, and antitrust law. Her work has appeared or is forthcoming in
the UCLA Law Review, Berkeley Journal of Labor & Employment Law, Law and
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Contemporary Problems, and The Cambridge Handbook of U.S. Labor Law for the
Twenty-First Century, and has been recognized with the Jerry S. Cohen Award for
Antitrust Scholarship (category prize, 2016). She earned her JD from Yale Law
School and completed a judicial clerkship on the Ninth Circuit Court of Appeals.
Veena Dubal is an Associate Professor of Law at the University of
California, Hastings College of Law. Her research focuses on the intersection of
law, technology, and precarious work. She has been cited by the California
Supreme Court, and her scholarship has been published in top-tier law review and
peer-reviewed journals.
The amici curiae have moved for leave to file this brief in support of the
plaintiffs.
SUMMARY OF ARGUMENT
The Sherman Act protects sellers of goods and services (including workers,
who sell their labor) from powerful purchasers. Gregory J. Werden, Monopsony
and the Sherman Act: Consumer Welfare in a New Light, 74 Antitrust L.J. 707,
714 (2007). Senator Sherman stated that trusts and monopolies “regulate prices at
their will, depress the price of what they buy and increase the price of what they
sell.” 21 Cong. Rec. 2461 (1890). See also Mandeville Island Farms, Inc. v.
American Crystal Sugar Co., 334 U.S. 219, 236 (1948) (“The [Sherman Act] does
not confine its protection to consumers, or to purchasers, or to competitors, or to
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sellers.”). Moreover, antitrust analysis under the rule of reason is carefully
circumscribed. It “does not open the field of antitrust inquiry to any argument in
favor of a challenged restraint that may fall within the realm of reason.” National
Society of Professional Engineers v. United States, 435 U.S. 679, 688 (1978).
The district court undercut the Sherman Act’s protection of sellers and
contradicted Supreme Court guidance on analyzing restraints of trade. The
plaintiffs—current and former college basketball and football players—are sellers
of athletic services to the member colleges of the National Collegiate Athletic
Association (NCAA). They allege that the NCAA and its member colleges
collusively restrained intercollegiate competition for their athletic services and
deprived them of the right to earn competitive compensation for their hard work
and talent.2 Once the plaintiffs established a prima facie case under the rule of
reason,3 the court allowed the NCAA to rebut this presumption by showing
benefits to others groups, such as viewers of college sports, and credited one of

2

The players generate billions in annual revenues for the NCAA and its member
colleges. A fair market for their athletic services ultimately requires both
competition among colleges and collective organizations for players. In general,
labor markets serve workers best when both employers compete for their skills and
workers exercise collective power through labor unions.
3
The Supreme Court and this Court have held that the NCAA’s horizontal
restraints should be evaluated under the rule of reason and are not subject to per se
invalidation. National Collegiate Athletic Ass’n v. Bd. Of Regents of Univ. of
Okla., 468 U.S. 85, 86 (1984); O’Bannon v. National Collegiate Athletic Ass’n,
802 F.3d 1049, 1063-64 (9th Cir. 2015).
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these justifications (purported viewer interest in college sports on account of
limited player compensation). While it correctly found the NCAA liable, the
district court, in balancing harms to one class (college athletes) against benefits to
another group (viewers of college sports), undermined the Sherman Act’s
protection of sellers and ignored Supreme Court guidance on how to analyze
restraints of trade.
In accordance with congressional intent, the Supreme Court, since the early
years of the Sherman Act, consistently has held that the law protects sellers from
restraints of trade and monopolistic practices. In Swift & Co. v. United States, 196
U.S. 375 (1905), the Supreme Court affirmed a district court’s finding of liability
against stockyard owners that had collusively suppressed the price of cattle paid to
ranchers. The Court in a subsequent buyer-side price-fixing case made clear that
the Sherman Act protects both purchasers and sellers. Mandeville Island Farms,
334 U.S. at 236. It stated, “The Act is comprehensive in its terms and coverage,
protecting all who are made victims of the forbidden practices by whomever they
may be perpetrated.” Id. (emphasis added). Just earlier this year, the Supreme
Court held that a monopolistic intermediary inflicts distinct injuries on purchasers
and sellers and that both classes have the right to recover antitrust damages from
the monopolist. See Apple Inc. v. Pepper, 139 S.Ct. 1514, 1525 (2019).

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In effectuating the Sherman Act’s protection of multiple classes of economic
actors, the courts should look only at a restraint’s effects on the plaintiffs and
should not “sacrifice competition in one portion of the economy for greater
competition in another portion[.]” United States v. Topco Associates, Inc., 405 U.S.
596, 611 (1972). Accordingly, the rule of reason is restricted only to a challenged
restraint’s costs and benefits for only the injured class. See National Society of
Professional Engineers, 435 U.S. at 688 (“Contrary to its name, the Rule does not
open the field of antitrust inquiry to any argument in favor of a challenged restraint
that may fall within the realm of reason. Instead, it focuses directly on the
challenged restraint's impact on competitive conditions.”).
The Court made this clear in National Society of Professional Engineers:
[T]he purpose of [antitrust] analysis is to form a judgment about the
competitive significance of the restraint; it is not to decide whether a policy
favoring competition is in the public interest, or in the interest of the
members of an industry. Subject to exceptions defined by statute, that policy
decision has been made by the Congress. Id. at 692.
In the wake of National Society of Professional Engineers, a court of appeals, in
applying the rule of reason to a labor-market facing restraint in professional sports,
rejected an unbounded rule of reason. Smith v. Pro Football, Inc., 593 F.2d 1173,
1186 (D.C. Cir. 1978).
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From an institutional perspective, the courts are ill-equipped to engage in a
broad cost-benefit analysis through the rule of reason. The Supreme Court
recognized that such balancing requires the evaluation of numerous
considerations—a task more appropriate for legislators than judges. Topco, 405
U.S. at 611-12. At a fundamental level, this type of balancing calls for judgments
that the courts should not make and should instead leave to democratically
accountable legislatures. See id. at 612 (“[T]o make the delicate judgment on the
relative values to society of competitive areas of the economy, the judgment of the
elected representatives of the people is required.”); Smith, 593 F.2d at 1186 (“The
draft’s ‘anticompetitive evils,’ in other words, cannot be balanced against its
‘procompetitive virtues,’ and the draft be upheld if the latter outweigh the
former.”).
Under the district court’s articulation of the rule of reason, firms with market
power can inflict harms on sellers through restraints of trade and monopolization
and defend themselves by showing benefits to another group—consumers, for
example. This type of balancing sacrifices sellers’ right to a fair marketplace in
order to serve buyers. The court gave powerful purchasers significant freedom to
disempower workers and other sellers through restraints of trade so long as they
show offsetting gains to consumers or another group. As such, firms are permitted
to maintain their buy-side restraints in partial or full measure.
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In this case, the results are especially perverse. Under the district court’s
ruling, colleges are given broad latitude to deprive athletes of the right to earn a
competitive wage to satisfy the purported peculiar preferences of the viewing
public. The expansive rule of reason “leads to the abhorrent result of allowing
purchasers of labor to unlawfully exploit one class of people (in this case,
predominantly African American college athletes) for the purpose of benefiting
another, presumably a more important class of people (the consumers of college
athletics, in particular the viewers of televised men's football and basketball
games).” Tibor Nagy, The “Blind Look” Rule of Reason: Federal Courts’ Peculiar
Treatment of NCAA Amateurism Rules, 15 Marq. Sports L. Rev. 331, 366-67
(2005).
In evaluating the challenged restraint, the district court should have confined
its rule of reason analysis to the effects on college athletes—and not considered
effects on other groups. Once the plaintiffs established their prima facie case, the
district court should have considered only the presumptively illegal restraint’s
offsetting benefits to the college athletes themselves. The restraint’s supposed
benefits to other groups, such as viewers of college sports, should have been
disregarded. This bounded approach ensures that the Sherman Act fully protects
sellers, such as the plaintiffs, from purchasers’ restraints of trade.

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ARGUMENT
1.

The Sherman Act Protects Workers and Other Sellers from Purchasers’
Restraints of Trade and Monopolistic Practices
The Sherman Act protects sellers of goods and services from powerful

purchasers. In enacting the Sherman Act, Congress aimed to safeguard the freedom
of workers, farmers, and other sellers from monopolies and trusts. See Gregory J.
Werden, Monopsony and the Sherman Act: Consumer Welfare in a New Light, 74
Antitrust L.J. 707, 714 (2007) (“The legislative history leaves no doubt that
Congress intended to protect sellers victimized by trusts and other conduct within
the scope of the Sherman Act’s prohibitions.”). Indeed, Americans in the late
nineteenth century principally opposed the trusts and monopolies (and supported
antitrust legislation at the federal and state levels) because these powerful
corporations threatened their interests as producers—business proprietors, farmers,
and workers. David Millon, The Sherman Act and the Balance of Power, 61 S. Cal.
L. Rev. 1219, 1226 (1988). Given this clear congressional intent, the Supreme
Court and this Court have long held that sellers are protected from buyers’
restraints of trade and monopolization.
A sample of floor remarks from the debate concerning the Sherman Act
illustrates Congress’s intent to protect sellers. Senator Sherman condemned the
trusts for their power over both buyers and sellers. He declared, “They regulate
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prices at their will, depress the price of what they buy and increase the price of
what they sell.” 21 Cong. Rec. 2461 (1890). See also 21 Cong. Rec. 2457 (1890)
(remarks of Sen. Sherman) (A trust can “command[] the price of labor without fear
of strikes, for in its field it allows no competitors.”). Senator George, a lead drafter
of the bill, expressed almost identical sentiments and attacked the trusts’ power as
purchasers and sellers. See 21 Cong. Rec. 1768 (1890) (“They operate with a
double-edged sword. They increase beyond reason the cost of the necessaries of
life and business and they decrease the cost of raw material, the farm products of
the country. They regulate prices at their will, depress the price of what they buy
and increase the price of what they sell.”).
Exemplifying this legislative interest in the autonomy and wellbeing of
sellers, members of Congress repeatedly cited the beef trust for its dominance over
both ranchers and consumers. The Senate even established a special committee to
investigate it. John B. Kirkwood, The Essence of Antitrust: Protecting Consumers
and Small Suppliers from Anticompetitive Conduct, 81 Fordham L. Rev. 2425,
2435 (2013). In addressing the power of the beef trust, Representative Taylor
asserted, “This monster robs the farmer on the one hand and the consumer on the
other.” 21 Cong. Rec. 4098 (1890). In a similar spirit, Senator Allison observed
that “there is a combination in the city of Chicago which not only keeps down the

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price of cattle upon the hoof, but also . . . make[s] the consumers of beef pay a high
price for that article.” 21 Cong. Rec. 2470 (1890).
In accordance with congressional intent, the Supreme Court, since the early
years of the Sherman Act, has held that the law protects sellers from restraints of
trade and monopolistic practices. In Swift & Co. v. United States, 196 U.S. 375
(1905), the Supreme Court affirmed a district court’s finding of liability against
stockyard owners that had collusively suppressed the price of cattle paid to
ranchers.
The Court in a subsequent buyer-side price-fixing case made clear that the
Sherman Act protects both purchasers and sellers. See Mandeville Island Farms,
Inc. v. American Crystal Sugar Co., 334 U.S. 219, 236 (1948) (“The [Sherman
Act] does not confine its protection to consumers, or to purchasers, or to
competitors, or to sellers.”). It stated, “The Act is comprehensive in its terms and
coverage, protecting all who are made victims of the forbidden practices by
whomever they may be perpetrated.” Id. (emphasis added). Applying this principle
of protecting all victims of antitrust violations including sellers, the Court held that
a football player-coach who alleged a group boycott of his services had the right to
take his claim to trial. Radovich v. National Football League, 352 U.S. 445, 453-54
(1957).

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The Sherman Act’s protection of sellers has not diminished over time, as
seen in decisions in recent years. The Court in a case concerning predatory bidding
treated buyer-side power as symmetric with seller-side power. See Weyerhaeuser
Co. v. Ross-Simmons Hardwood Lumber Co., 549 U.S. 312, 320 (2007)
(“Monopsony power is market power on the buy side of the market. As such, a
monopsony is to the buy side of the market what a monopoly is to the sell side and
is sometimes colloquially called a ‘buyer’s monopoly.’”) (citations omitted).
In a decision from earlier this year, the Supreme Court affirmed the antitrust
protection of sellers and held that a monopolistic intermediary inflicts distinct
injuries on purchasers and sellers. It ruled that both classes have the right to
recover antitrust damages from the monopolist. See Apple Inc. v. Pepper, 139 S.Ct.
1514, 1525 (2019) (“[S]ome downstream iPhone consumers have sued Apple on a
monopoly theory. And it could be that some upstream app developers will also sue
Apple on a monopsony theory. In this instance, the two suits would rely on
fundamentally different theories of harm and would not assert dueling claims to a
‘common fund[.]’”).
This Court, in accordance with congressional intent and Supreme Court
precedent, has held that the Sherman Act protects sellers. For example, it affirmed
a district court verdict against two pulp processors for, among other conduct,
collusively suppressing the price paid for logs. Reid Bros. Logging Co. v.
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Ketchikan Pulp Co., 699 F.2d 1292, 1303 (9th Cir. 1983). In a different case
interpreting California and federal antitrust laws, it wrote that buyer-side collusion,
just as much as seller-side collusion, is actionable:
When horizontal price fixing causes buyers to pay more, or sellers to receive
less, than the prices that would prevail in a market free of the unlawful trade
restraint, antitrust injury occurs. This is seen most often in claims by
overcharged buyers; as to underpaid sellers it is less common in the reported
cases, but is equally true. Knevelbaard Dairies v. Kraft Foods, Inc., 232 F.3d
979, 988 (9th Cir. 2000).
In a 2011 decision, this Court again stressed the antitrust protection for
sellers. The Court stated, “Congress sought to ensure that competitors not cut deals
aimed at stifling competition and at permitting higher prices to be charged to
consumers than would be expected in a competitive environment, or permitting
lower prices to be paid to those from whom competitors bought materials than a
fair market rate.” California ex rel. Harris v. Safeway, Inc. 651 F.3d 1118, 1132
(9th Cir. 2011) (en banc) (emphasis added).
II. The District Court’s Application of the Rule of Reason Subverts the
Sherman Act’s Protection of Workers and Other Sellers
The district court’s application of the rule of reason undermines the Sherman
Act’s protection of sellers and is inconsistent with Supreme Court guidance on
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applying the rule of reason. The court compared the established harms of the
challenged restraints to the plaintiffs (sellers of their athletic services) against the
purported benefits to viewers of college sporting events (consumers in this case).
By engaging in this cross-market balancing, the district court undercut the
Sherman Act’s protection of sellers. This type of balancing is also contrary to the
Supreme Court’s directive that the rule of reason “does not open the field of
antitrust inquiry to any argument in favor of a challenged restraint that may fall
within the realm of reason.” National Society of Professional Engineers v. United
States, 435 U.S. 679, 688 (1978).
A.

The District Court’s Application of the Rule of Reason
Subordinates Sellers’ Interests to Consumers’ Interests

While it found that the NCAA’s restraints inflicted harm on college athletes,
the district court allowed this injury to the plaintiffs to be weighed against benefits
to viewers of college sports. To be sure, the court did not credit most of the
NCAA’s proffered benefits to consumers (or plaintiffs). It, however, did conclude
that the NCAA established that consumers value college sports, in part, because of
the restrictions on player compensation (in contrast to professional sports in which
caps on player compensation are limited or non-existent). In other words, the
district court balanced the benefit to consumers against the demonstrated injury to
college athletes.
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Under the district court’s rule of reason, firms with market power can inflict
harms on sellers through restraints of trade and monopolization and defend
themselves by showing offsetting benefits to another group, such as downstream
purchasers. They can be found liable but subject to only a modest remedy, as the
NCAA was here. Even more troublingly, under this formulation of the rule of
reason, defendants can potentially escape liability entirely if they can demonstrate
that their restraint’s benefits to consumers exceed the harm to workers or other
sellers. In other words, powerful purchasers have significant freedom to
disempower workers and other sellers and deprive them of a competitive income
through restraints of trade so long as they show offsetting gains to consumers.
Instead of protecting sellers in full measure, the district court subordinates
their interests to consumer interests. The Supreme Court and this Court have made
clear that the Sherman Act protects workers and other sellers of services just as
much as it protects consumers and other purchasers. See supra Part I. The district
court’s decision, however, grants significant latitude to firms to injure sellers
through restraints of trade provided that they can establish offsetting benefits to
consumers.
This type of balancing sacrifices sellers’ right to a fair marketplace in order
to serve buyers’ purported preferences. In this case, the results are especially
indefensible. Under the district court’s ruling, colleges are given broad latitude to
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deprive athletes of the right to earn a competitive wage to satisfy the supposed
preferences of the viewing public. The expansive rule of reason “leads to the
abhorrent result of allowing purchasers of labor to unlawfully exploit one class of
people (in this case, predominantly African American college athletes) for the
purpose of benefiting another, presumably a more important class of people (the
consumers of college athletics, in particular the viewers of televised men's football
and basketball games).” Tibor Nagy, The “Blind Look” Rule of Reason: Federal
Courts’ Peculiar Treatment of NCAA Amateurism Rules, 15 Marq. Sports L. Rev.
331, 366-67 (2005).
B.

The Supreme Court Has Directed the Lower Courts Not to Engage in
Open-Ended Cost-Benefit Analysis Under the Rule of Reason
The district court’s antitrust analysis also is contrary to the Supreme Court’s

directive against broad cost-benefit analysis under the rule of reason. Rejecting
judicial measuring of social debits and credits through the Sherman Act, the
Supreme Court wrote, “If a decision is to be made to sacrifice competition in one
portion of the economy for greater competition in another portion this too is a
decision that must be made by Congress and not by private forces or by the
courts.” United States v. Topco Associates, Inc., 405 U.S. 596, 611 (1972).
In effectuating the Sherman Act’s protection of multiple classes, the rule of
reason is restricted to a challenged restraint’s costs and benefits for only the
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affected class in the relevant market. The rule of reason’s lens is circumscribed, not
unbounded. See National Society of Professional Engineers, 435 U.S. at 688
(“Contrary to its name, the Rule does not open the field of antitrust inquiry to any
argument in favor of a challenged restraint that may fall within the realm of reason.
Instead, it focuses directly on the challenged restraint's impact on competitive
conditions.”). The Court made this clear:
[T]he purpose of [antitrust] analysis is to form a judgment about the
competitive significance of the restraint; it is not to decide whether a policy
favoring competition is in the public interest, or in the interest of the
members of an industry. Subject to exceptions defined by statute, that policy
decision has been made by the Congress. Id. at 692.4
In the wake of National Society of Professional Engineers, a court of appeals, in
applying the rule of reason to a labor-market facing restraint in professional sports,
rejected an unbounded rule of reason. Smith v. Pro Football, Inc., 593 F.2d 1173,
1186 (D.C. Cir. 1978). See also Safeway, 651 F.3d at 1161 (Reinhardt, J.,

Consider the Supreme Court’s adoption of the rule of reason for vertical restraints
governing retail markets. These decisions have not broadened the scope of the rule
of reason. Instead, the Court considers the relevant costs and benefits borne by or
accruing to the directly affected group—consumers affected by the vertical
restraints. See, e.g., Continental T.V., Inc. v. GTE Sylvania Inc., 433 U.S. 36, 54-59
(1977) (holding vertical non-price restraints are subject to rule of reason and, in
effect, requiring gains in interbrand competition to be weighed against reduction in
intrabrand competition); Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551
U.S. 877, 897-99 (2007) (same with respect to minimum vertical price restraints).
4

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dissenting) (“[D]riving down compensation to workers [through an agreement
among rivals] is not a benefit to consumers cognizable under our laws as a
‘procompetitive’ benefit.”); Larry V. Muko, Inc. v. Southwestern Pennsylvania
Building & Construction Trades Council, 670 F.2d 421, 439 (3d Cir. 1982)
(Sloviter, J., dissenting) (“[A]ntitrust cases have always rejected the premise that a
procompetitive effect in one market will excuse an anticompetitive effect in
another.”).5
Furthermore, from an institutional perspective, the courts are ill-equipped to
engage in a broad cost-benefit analysis through the rule of reason. The Supreme
Court recognized that such balancing requires a weighing of values and the
evaluation of numerous considerations—a task more appropriate for legislators
than judges. Topco, 405 U.S. at 611-12. This type of cost-benefit analysis
introduces significant administrative difficulties and risks severely weakening
antitrust law. Daniel A. Crane, Balancing Effects Across Markets, 80 Antitrust L.J.
397, 409-10 (2015). See also Rebecca Haw Allensworth, The Commensurability
Myth in Antitrust, 69 Vand. L. Rev. 21-22 (2016) (observing the difficulties of
balancing costs and benefits to different classes of consumers).

5

In evaluating the legality of mergers under the Clayton Act, the Supreme Court
held that “a merger the effect of which ‘may be substantially to lessen competition’
is not saved because, on some ultimate reckoning of social or economic debits and
credits, it may be deemed beneficial.” United States v. Philadelphia National Bank,
374 U.S. 321, 371 (1963).
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At a fundamental level, this type of balancing calls for judgments that the
judiciary should generally avoid. The Supreme Court recognized the comparative
weakness of courts vis-à-vis legislative bodies in making broad economic,
political, and social judgments:
If a decision is to be made to sacrifice competition in one portion of the
economy for greater competition in another portion this too is a decision that
must be made by Congress and not by private forces or by the courts. Private
forces are too keenly aware of their own interests in making such decisions
and courts are ill-equipped and ill-situated for such decisionmaking. To
analyze, interpret, and evaluate the myriad of competing interests and the
endless data that would surely be brought to bear on such decisions, and to
make the delicate judgment on the relative values to society of competitive
areas of the economy, the judgment of the elected representatives of the
people is required. Topco, 405 U.S. at 611-12.
Applying this principle, a court of appeals rejected open-ended cost-benefit
analysis in an antitrust challenge to a professional sports league’s restraints of
trade. See Smith, 593 F.2d at 1186 (“The draft’s ‘anticompetitive evils,’ in other
words, cannot be balanced against its ‘procompetitive virtues,’ and the draft be
upheld if the latter outweigh the former.”).

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Through an unbounded rule of reason, the district court made policy choices
appropriately reserved for democratic institutions. The court, in balancing the
restraint’s harms to college athletes against its benefits to viewers of college sports,
improperly chose “to sacrifice competition in one portion of the economy for
greater competition in another portion[,]” Topco, 405 U.S. at 611, and usurped
legislative prerogatives.
III. The District Court Should Have Considered Only the Restraint’s Harms
and Benefits in the Market for College Athletes’ Services
The district court should have limited its rule of reason analysis of the
challenged restraint to the effects on college athletes. This cabined approach
ensures that the Sherman Act fully protects sellers, as Supreme Court precedent
makes clear it does, and does not become a vehicle for open-ended judgments
more appropriate for legislatures than for courts.
Once the plaintiffs established a prima facie case, the district court should
have only evaluated offsetting benefits of the restraint to the plaintiffs. The district
court should have confined its analysis to credible benefits in the affected
market—the market for college athletes’ services. It should not have considered
the NCAA’s arguments that the challenged restraints benefit other groups. For
instance, the question of whether restraints on college athletes’ compensation

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increase the value of college sports to viewers falls outside of a proper rule of
reason analysis.
A bounded rule of reason ensures that the Sherman Act protects “all who are
made victims” of antitrust violations, Mandeville Island Farms, 334 U.S. at 236
(emphasis added), including sellers of services such as the plaintiffs here. As such,
it would prevent the NCAA and other powerful buyers from inflicting harm on
college athletes and other sellers through restraints of trade and overcoming
presumptive illegality by showing benefits to another class. In considering only
harms and benefits to sellers, this rule of reason places sellers on an equal footing
with buyers under the Sherman Act, as they should be in light of congressional
intent and Supreme Court precedent. A circumscribed rule of reason “protect[s] the
economic freedom of participants in the relevant market[,]” Knevelbaard Dairies,
232 F.3d at 988 (citation omitted), and ensures that the judiciary reserves broader
economic, social, and political judgments to Congress and state legislatures.
CONCLUSION
The Sherman Act protects sellers of goods and services, including workers,
from buyers’ restraints of trade. In applying the rule of reason, the district court
subverted the Sherman Act’s protection of sellers of goods and services and
disregarded Supreme Court guidance against turning the rule of reason into a
general social cost-benefit analysis. While the district court correctly found the
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NCAA liable under the Sherman Act, it should have only evaluated the challenged
restraint’s harms and benefits to the plaintiffs—and not considered its effects on
other groups. Because it found that the challenged restraints had no benefit to
college athletes, the court should have enjoined all NCAA compensation restraints
and not looked to find a less restrictive alternative under the rule of reason.
DATED: OCTOBER 30, 2019

Respectfully submitted,
/s/ Sandeep Vaheesan

EMMA REBHORN
CHANGE TO WIN
90 Broad Street, Suite 710
New York, NY 10004
973-951-6281

SANDEEP VAHEESAN
Counsel of Record
OPEN MARKETS INSTITUTE
1440 G Street, NW
Washington, D.C. 20005
301-704-4736
vaheesan@openmarketsinstitute.org

NAJAH A. FARLEY
NATIONAL EMPLOYMENT LAW PROJECT
90 Broad Street, Suite 1100
New York, NY 10004
646-693-8225
Counsel for amici curiae

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UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
Form 8. Certificate of Compliance for Briefs
CERTIFICATE OF COMPLIANCE
Instructions for this form: http://www.ca9.uscourts.gov/forms/form08instructions.pdf

9th Cir. Case Number(s) _19-15566, 19-25661______________________________________

I am the attorney or self-represented party.
This brief contains ___4,955________ words, excluding the items exempted by Fed. R.
App. P. 32(f). The brief’s type size and typeface comply with Fed. R. App. P. 32(a)(5) and (6).
I certify that this brief (select only one):
[ ] complies with the word limit of Cir. R. 32-1.
[ ] is a cross-appeal brief and complies with the word limit of Cir. R. 28.1-1.
[X] is an amicus brief and complies with the word limit of Fed. R. App. P. 29(a)(5), Cir. R. 292(c)(2), or Cir. R. 29-2(c)(3).
[ ] is for a death penalty case and complies with the word limit of Cir. R. 32-4.
[ ] complies with the longer length limit permitted by Cir. R. 32-2(b) because (select only one):
[ ] it is a joint brief submitted by separately represented parties;
[ ] a party or parties are filing a single brief in response to multiple briefs; or
[ ] a party or parties are filing a single brief in response to a longer joint brief.
[ ] complies with the length limit designated by court order dated _____________.
[ ] is accompanied by a motion to file a longer brief pursuant to Cir. R. 32-2(a).

Signature _s/ Sandeep Vaheesan_______________ Date _October 30, 2019___________
(use “s/[typed name]” to sign electronically-filed documents)

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CERTIFICATE OF SERVICE
I hereby certify that on this date, I caused a true and correct copy of the
foregoing to be served on counsel of record for all parties via ECF.
/s/ Sandeep Vaheesan
Sandeep Vaheesan
Counsel for Amici Curiae

Dated: October 30, 2019

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