States sue NCAA over transfer rule

Seven state attorneys general announced they filed a lawsuit Thursday against the National Collegiate Athletic Association (NCAA) challenging the association’s limits on college athletes’ transfers.

In the lawsuit, the coalition claims that the association’s Transfer Eligibility Rule is illegal and restrains college athletes’ ability to market their labor and education choices. 

State attorneys general in Ohio, West Virginia, Colorado, Illinois, Tennessee, New York and North Carolina filed the lawsuit. 

The coalition referred to the NCAA’s implemented transfer rules as “a no-poach agreement between horizontal competitor member schools that serves to allocate the market for the labor of NCAA Division I college athletes.” 

“The Transfer Eligibility Rule artificially deters players and teams from achieving optimal matches by forcing college athletes to weigh the one-year ineligibility period against the benefits of moving to a better matched school,” according to the lawsuit. “It is ironic that this rule, stylized as promoting the welfare of college athletes, strips them of the agency and opportunity to optimize their own welfare as they see fit.”

The coalition also alleged in their lawsuit that the association’s transfer rule violated Section 1 of the Sherman Act, noting how the NCAA and its officials and employees entered an illegal agreement “to restrain and suppress” college athletes who want to transfer to other Division I school with losing their eligibility to compete. 

“Division I college athletes have been deprived of the benefits of free and open competition because of the Transfer Eligibility Rule,” according to the lawsuit. “Furthermore, college athletes forced to wait a year prior to eligibility after transferring are deprived of the benefits that come from competition in NCAA Division I athletic events, harming these college athletes’ current and future earning potentials.” 

The lawsuits come on the heels of the association’s recent decision to deny transfer waivers to a number of athletes in the past year. These include West Virginia University men’s basketball player RaeQuan Battle, Southern Illinois University men’s basketball player Jarrett Hensley, and University of North Carolina wide receiver Devontez “Tez” Walker. 

“Real issues are at stake here for the citizens of West Virginia, and they implicate my duties as the state’s chief antitrust officer,” West Virginia Attorney General Patrick Morrisey (R) said in a statement. “The NCAA also failed to recognize the underlying issues involving RaeQuan and many other student athletes in similar situations—there’s no reason for the NCAA to deny this young man the ability to play the sport he loves and that helps him with his mental health.”

The coalition seeks a temporary restraining order or preliminary injunction on the association enforcing this rule.