Lawsuit accuses NCAA of antitrust violation in college athlete transfer rule

A federal lawsuit filed by a group of states alleges the NCAA’s transfer rule for college athletes violates antitrust law.

The lawsuit, filed in West Virginia’s northern district, challenges the NCAA’s authority to impose a one-year delay in the eligibility of certain athletes who transfer between schools. The suit said the rule “unjustifiably restrains the ability of these college athletes to engage in the market for their labor as NCAA Division I college athletes.”

The lawsuit filed by West Virginia and six other states alleges violations of the Sherman Act.

NCAA rules allow underclassmen to transfer once without having to sit out a year. But an additional transfer as an undergraduate generally requires the NCAA to grant a waiver allowing the athlete to compete immediately. Without it, the athlete would have to sit out for a year at the new school.

The NCAA has implemented stricter guidelines for granting those waivers on a case-by-case basis.

In an interview with The Associated Press, North Carolina Attorney General Josh Stein said the target is the waiver process.

“As long as the kid is in good academic standing and on track to graduate, that kid should be able to decide for him or herself what’s in their best interest, for their personal growth, their happiness, their economic opportunity,” Stein said. “That is absolutely the American Way. And that’s a requirement of federal law. The rule offends that requirement.”

The states seek a temporary restraining order against the NCAA from enforcing the transfer rule. Other states involved are Colorado, Illinois, New York, Ohio and Tennessee.

“The NCAA is disappointed in the decision by seven state attorneys general to bring legal action — with the tacit support of a small number of schools — the result of which could potentially mean team rosters changing monthly or weekly," NCAA spokeswoman Saquandra Heath said in a statement.

"The NCAA believes that if a member school objects to a rule or policy, that member should propose alternative rules that apply to everyone, not turn to lawsuits to bypass the system they designed.”

The complaint alleges requiring athletes to sit can mean lost potential earnings from endorsement deals with their name, image and likeness (NIL) or professional careers. It points to exposure from competing in national broadcasts, noting: “One game can take a college athlete from a local fan favorite to a household name.”

"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 lawsuit said.

Stein, a Democrat running for North Carolina governor, got involved in the recent transfer-waiver case involving Tar Heels receiver Devontez “Tez” Walker.

The NCAA initially denied the Kent State transfer's waiver as a two-time transfer after his stop at North Carolina Central, even though he never played there because the COVID-19 pandemic wiped out NCCU's 2020 season. UNC fought for months to get Walker cleared in a testy case before the NCAA reversed its position in October.

Stein had also sent a letter supporting Wake Forest men’s basketball player Efton Reid III, who started at LSU before transferring to Gonzaga. The 7-footer finally received a waiver to play Tuesday and made his debut in the Demon Deacons’ win against Rutgers on Wednesday.

Stein told the AP the lawsuit grew out of a national conference in Washington, D.C., this week for attorneys general. Stein participated in a panel discussion on the NCAA there with Colorado AG Phil Weiser, Ohio AG Dave Yost and Ohio Deputy First Attorney General Shawn Busken.

“I have not heard from any other institutions, but I know that other student-athletes in North Carolina are similarly being denied the opportunity to play,” Stein said. “So rather than continue to do case-by-case, we decided let’s strike the rule down, because the rule itself is illegal.”

West Virginia Attorney General Patrick Morrisey, a Republican running for governor next year, got involved after the NCAA denied West Virginia basketball player RaeQuan Battle a waiver to play immediately following his transfer from Montana State. Battle had previously played at Washington, but hasn't played this year after the NCAA denied Battle’s waiver and appeal.

Battle, who grew up on the Tulalip Indian Reservation in the state of Washington, said his mental health is a big reason why he’s at West Virginia. Battle said in a recent video that he has lost “countless people” to drugs, alcohol and COVID-19.

After Battle visited West Virginia, he learned that now-coach Josh Eilert had lived on the Pine Ridge Indian Reservation in South Dakota with his mother following his parents’ divorce.

Battle’s coach at Montana State, Danny Sprinkle, left for Utah State after the 2022-23 season. Battle said Sprinkle was one of his main pillars of support and guidance, so staying at Montana State wasn’t an option. And although Battle would have kept his eligibility had he followed Sprinkle, Battle said his graduation date would have been significantly delayed.

Morrisey said in a statement that the NCAA "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 lawsuit also cited mental health issues in the transfer cases of Southern Illinois basketball player Jarrett Hensley and Southern Illinois football player Noah Fenske. Hensley previously attended UNC Greensboro and Cincinnati, while Fenske also attended Iowa and Colorado.