Paper No. 6
Why antitrust law makes the current system unsustainable—and why only a collectively bargained framework can provide durable rules.
"Limitations of this kind can be preserved in practice no other way than through the medium of courts of justice."
— Alexander Hamilton, Federalist No. 78
The instability of the current system is not merely economic or institutional. It is legal.
The prior papers have described a system that lacks coherent authority, produces escalating costs, and fails to align the interests of its participants. But these deficiencies are not occurring in a vacuum. They are unfolding within a legal framework that increasingly constrains the ability of institutions to coordinate their conduct.
This paper advances a central claim: the present model of college athletics cannot be stabilized under existing antitrust law. Any durable solution must either comply with that law or operate within a structure that alters its application—most plausibly through collective bargaining or a functionally equivalent arrangement.
I. The Basic Constraint
Antitrust law, at its core, prohibits agreements among competitors that restrain trade.
In the context of college athletics, this principle has direct application. Universities compete with one another for athletes. Agreements among them to limit compensation, restrict movement, or otherwise regulate the terms under which athletes participate are therefore subject to scrutiny.
For many years, the NCAA operated under the assumption that its rules would receive some degree of judicial deference based on the concept of amateurism. That assumption no longer holds.
As established in NCAA v. Alston, such rules are evaluated under ordinary antitrust principles. They must be justified, and they must withstand analysis that considers their actual effects.
This creates a fundamental constraint: institutions cannot simply agree among themselves to impose limits that would be impermissible in other markets.
II. The Failure of the Current Model
The present system attempts to maintain coordinated rules without a legal structure capable of sustaining them.
At its core, the NCAA and its member institutions are horizontal competitors in the market for athletic labor. Each institution seeks to attract and retain athletes, and each stands to benefit from imposing limits on the compensation and movement of those athletes. Agreements among such competitors to restrict these terms are, under ordinary principles of antitrust law, presumptively suspect.
For many years, the NCAA relied on the concept of amateurism as a justification for these coordinated restraints. That justification has steadily weakened. In O’Bannon and, more decisively, in NCAA v. Alston, courts rejected the notion that the NCAA’s rules are entitled to categorical deference. Instead, they are subject to the same rule-of-reason analysis applied in other industries.
Under that framework, the NCAA must demonstrate that its restraints serve a procompetitive purpose and that they are reasonably tailored to achieve that purpose. Even where some justification is accepted, less restrictive alternatives must be considered.
This is a demanding standard. It requires not only that a rule be defensible in theory, but that it withstand scrutiny in practice.
The difficulty is that many of the NCAA’s core restrictions—limits on compensation, constraints on benefits, and rules governing athlete mobility—are precisely the types of agreements that antitrust law is designed to examine closely. As those rules are challenged, institutions are required to defend them individually, often with limited success.
The result is not a coherent system of governance, but a series of partial defenses. Some rules survive in modified form. Others are struck down. Still others are abandoned before adjudication.
This process does not produce stability. It produces fragmentation.
What has been weakened in doctrine cannot be preserved in practice by repetition. It must be justified—or replaced.
III. The Limits of Coordination Without Structure
The core difficulty is not simply that institutions wish to coordinate. It is that they are attempting to do so without a legally recognized framework that permits coordination of this kind.
In most markets, competitors cannot agree to fix prices, cap compensation, or restrict the movement of labor. Such agreements are treated as unlawful restraints of trade, regardless of whether they are motivated by a desire for competitive balance or long-term stability.
College athletics is increasingly being analyzed within that same framework.
Absent a structural exemption or alternative legal regime, agreements among institutions to limit athlete compensation or movement will continue to face challenge. Each such agreement must be justified anew. Each must survive scrutiny under evolving case law. And each is vulnerable to being invalidated.
This creates a paradox. The more institutions attempt to coordinate in order to stabilize the system, the more exposed they become to legal challenge.
The experience of recent litigation demonstrates this dynamic. Restrictions once thought essential to the model are now contested. Rules are revised not through internal deliberation, but in response to external pressure. The system adapts, but it does not stabilize.
Professional sports leagues confronted this problem directly. Left unstructured, agreements among teams to limit player compensation or movement would face the same antitrust challenges. The solution was not to abandon coordination, but to place it within a lawful framework—most notably through collective bargaining agreements with players’ unions.
Within that framework, rules governing compensation, free agency, and roster construction are not treated as unlawful conspiracies among competitors, but as negotiated terms between parties with recognized interests.
College athletics, by contrast, attempts to achieve similar outcomes without the same legal foundation.
The result is predictable. Coordination without structure is treated as collusion. Stability without agreement is treated as restraint.
A system that relies on such coordination cannot endure in its present form.
IV. The Role of Collective Bargaining
A collectively bargained system offers a path to lawful coordination.
Under such a system:
- Compensation structures can be defined
- Movement rules can be established
- Eligibility frameworks can be agreed upon
- Enforcement mechanisms can be implemented
These features are not immune from scrutiny, but they are evaluated under a different legal standard than unilateral agreements among competitors.
The key distinction is consent. Where rules are negotiated between parties with defined interests—institutions and athletes—they are not treated in the same manner as imposed restraints.
This does not eliminate all legal risk. It alters its character.
V. The Cost of Avoidance
Institutions may prefer to avoid this transition. Collective bargaining introduces complexity. It requires organization among athletes. It formalizes relationships that have historically been treated as distinct from employment.
But avoidance carries its own cost.
Absent a lawful framework, the system will continue to be shaped through litigation. Rules will be defined not by design, but by judicial decision. Constraints will emerge incrementally, often without regard to systemic coherence.
In such an environment, institutions do not control the rules. They respond to them.
VI. The Inevitability of Structural Change
The trajectory of recent cases makes clear that the current model cannot be preserved indefinitely.
Efforts to maintain coordinated limits without a supporting legal structure will continue to face challenge. Some may succeed in the short term. Over time, the cumulative effect is erosion.
The system will change. The only question is how.
A system that emerges through deliberate design—grounded in lawful structure and aligned incentives—will differ materially from one that emerges through piecemeal litigation.
VII. The Institutional Choice
Institutions are therefore confronted with a choice.
They may continue to operate within a legally unstable framework, defending individual rules as they are challenged and adapting incrementally as those challenges succeed.
Or they may participate in the construction of a system that can sustain coordinated rules within the bounds of the law.
The former preserves flexibility in the short term. The latter provides stability in the long term.
VIII. Law as Constraint and Catalyst
Antitrust law is often described as a constraint on institutional action. In the present context, it is more accurately understood as both constraint and catalyst.
It constrains what institutions may do in isolation. It prevents competitors from coordinating in ways that suppress compensation or restrict mobility without sufficient justification. In doing so, it limits the ability of the current system to preserve itself through informal agreement.
But it also serves a catalytic function. By restricting unstructured coordination, it creates the conditions under which structured agreement becomes necessary.
Institutions are not prohibited from creating rules. They are prohibited from doing so without a lawful framework. The distinction is not between regulation and non-regulation, but between coordinated action that is justified and that which is not.
This distinction matters. It explains why the present system continues to lose ground in litigation while more structured systems—such as those in professional sports—are able to sustain coordinated rules over time.
The law does not forbid order. It requires that order be constructed in a manner consistent with recognized legal principles.
In this respect, antitrust law is not merely an external pressure on the system. It is the reason a new system must be built.
IX. From Litigation to Design
The present system is being reshaped through litigation. Each case alters the boundaries within which institutions operate. Each decision redefines what is permissible, often in narrow and context-specific ways.
This process is not well suited to system design.
Courts resolve disputes. They do not construct comprehensive frameworks. They do not align incentives across participants, nor do they account for the full range of interests at stake. Their role is reactive, not architectural.
The consequence is a system that evolves incrementally, without coherence. Rules are invalidated piecemeal. New practices emerge without coordination. The overall structure becomes increasingly difficult to define.
This is not a path to stability. It is a path to fragmentation.
A durable system requires something different: agreement, structure, and legitimacy. It requires rules that are not merely defensible in isolation, but coherent in combination. It requires a framework within which coordination is not only possible, but lawful.
Such a system will not emerge from continued litigation. It must be constructed.
The choice before institutions is therefore not whether change will occur. It is whether that change will be directed or imposed.
A system designed by its participants may balance interests, allocate value, and establish durable rules. A system produced through litigation will reflect only the resolution of individual disputes, without regard to broader coherence.
The distinction is not academic. It is determinative.
The system that follows will either be the product of deliberate design or the accumulation of judicial decisions. It cannot be both.
Those who act will shape it. Those who do not will be shaped by it.
Law does not wait for structure. It fills the space where structure is absent.