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Thursday, January 03, 2013

Penn State Rescue Blues: initial read on Corbett's Complaint

As the annual ritual of New Year’s Day bowl games came to a conclusion, Pennsylvania Governor Tom Corbett held a press conference that was, in a sense, curiously timed yet simultaneously fitting. Corbett announced that the Commonwealth of Pennsylvania is suing the NCAA for antitrust violations stemming from the sanctions imposed upon Penn State in the wake of the Jerry Sandusky scandal. Corbett intimated that sanctions (4-year bowl ban, $60 million fine, scholarship reductions, and vacation of wins) were unlawful, and imposed with intent to disadvantage Penn State both on and off the field. The full complaint can be found here. There are financial and political considerations at play here, and in no uncertain terms, the suit seeks to protect Penn State football.

Like any fact-intensive antitrust suit, many key issues are far from resolved, and much is still to be determined (for a full analysis of the merits of the suit, see Mike’s Sports Illustrated piece). Also, see Marc and Howard's comments from earlier. What is apparent from Corbett’s actions and from the face of the Complaint, however, is that college football possesses influence and leverage unmatched by any other sport.

The language of the Complaint readily concedes the influence of the sport, stating at the outset of the facts that “Division I college football is big business.” Further, much of the State’s case centers on the alleged economic impact of the sanctions, including effects on the School’s revenue, on local businesses, and on jobs. The economic effects will be determined in discovery if the case reaches that phase, and the actual impact beyond the fine and lost bowl revenue is questionable since Penn State will still play all of its home games for the duration of the penalty, and still has attendance figures that rate near the top in Division I. But the point is clear: top tier college football programs are among the most valuable assets of state and local economies. Like any valuable commodity, expect all stops to be pulled out in protecting what many consider Penn State’s most prized asset.

I do not represent the NCAA (never have), and I have actually been directly adverse to the NCAA, and actively defend student-athletes, coaches, schools, and related companies in various NCAA enforcement proceedings. That being said, I am troubled by various aspects of this Complaint as drafted. Some quick thoughts on my initial read of the Complaint are below.

Unfortunately, Corbett claims that constitutional due process was owed to Penn State, and not given. Neither Penn State nor any other NCAA member institution is owed such protections in the NCAA administrative law system (see my blog piece here attacking this notion). Corbett makes an improper legal conclusion on this point in Paragraph 53 defining “ ‘traditional investigative and administrative proceedings’-i.e., due process”.
Two sentences that should not be back to back in this Complaint: “Penn State was forced to sign away its procedure rights, including an investigation of the charges against it, factual findings that NCAA rules were violated, a hearing before the NCAA’s Committee on Infractions, and an appeal of any adverse ruling.” Followed by… “These punishments threaten to have a devastating, long-lasting, and irreparable effect on the Commonwealth, its citizens, and its economy.” As someone who actively works on matters in the NCAA administrative law system, I can tell you that it could have been more devastating, more long-lasting, and possibly irreparable if Penn State did not sign the consent agreement and actually went through the infractions process. The death penalty and punishment short of the same, but worse that the current Penn State sanctions, certainly could have resulted through the infractions process. I am not saying that I agree with what the NCAA did here, but if I am a Nittany Lion, I am not so quick to assume that I would get a better deal going through infractions.
I believe that some programs in the NCAA get treated differently than others on the enforcement end of things. However, Corbett is suggesting that there is some intent to bring Penn State down as if the NCAA was looking for a reason to do so, and jumped on the opportunity with the Sandusky scandal. This is a stretch, which does not advance the ball to defeat a Motion to Dismiss, so Corbett may lose some credibility with the Judge on this one.
Related to the above, Corbett is suggesting a conscious effort on the part of the NCAA to advance other member institutions at the expense of Penn State. What schools would those be? Competitors in the Big Ten that felt the weight of Penn State bringing down conference revenues? Schools that could pick-off those players who wanted to transfer as a result of the sanctions?
There is a great deal of ink devoted to all of the money spent in Pennsylvania in support of Penn State football, but nothing in the NCAA sanctions effects that income (the same amount of games are played by Penn State in the Commonwealth) so long as people keep supporting the program, which certainly was not a problem this year. A death penalty that would only result if Penn State went through the infractions process would have had the negative effects that Corbett enumerates. I have not yet had someone articulate for me how the current Penn State sanctions could be worse that the one year death penalty suffered by SMU. A notion that Corbett suggests in Paragraph 73(b).
Corbett admits that the revelation of Sandusky’s crimes “created a public relations crisis around its popular and respected football program for more than forty years suddenly found itself broken.” Did the NCAA make it more broken with the subject sanctions? Prior to the NCAA’s involvement, Corbett admits that “Penn State’s public image had been significantly tarnished.” Did the NCAA make it more significantly tarnished with the aforementioned sanctions?
There is not an argument in the alternative here. That would look something like: “this is none of the NCAA’s business, so invalidate”, or in the alternative, “we did not get to go through the infractions process, so invalidate.” Instead, the Complaint reads that “this is none of the NCAA’s business” and “we want our hearing that NCAA business gets”.
What is to say that a drop in interest in the program from incoming recruits, current players, alumni, and others is not the result simply of Sandusky’s crimes and the allegations of cover-up in the greater football staff and University administration? How will Corbett prove this up, particularly after spending multiple paragraphs of his own complaint acknowledging the damage to the program before the NCAA acted?

Interestingly, it seems that Corbett has long recognized both the importance and the politics of college sports. He cited his desire to avoid distracting the football program as rationale for the timing of the filing. Further, Corbett, who previously served as Pennsylvania Attorney General, has been widely criticized for his staff’s delayed reaction to the Sandusky allegations while serving in that role. It has been posited, fairly or unfairly, that his deliberation was a tact employed to avoid upsetting Penn State supporters (and Corbett voters). Incoming Attorney General Kathleen Kane has criticized Corbett, and has vowed to investigate the delay.

To be fair, this phenomenon is not unique to Corbett and PSU. We have seen this in other contexts, whether it be former SMU President and Texas Governor Bill Clements’ involvement in the School’s pay-for-play scandal, Utah Senator Orrin Hatch threatening to bring an antitrust suit against the BCS, or the slew of litigation related to conference exit fees imposed on departing member institutions. The fact remains that college football begets strong emotional responses, and often the accompanying litigation. Interestingly, since Penn State is a public institution tax payers, many whom are assuredly Penn State fans, are going to foot the bill for both the litigation and the fine.

In handing down the sanction in the first place, the NCAA noted that criminal charges are generally outside the purview of its jurisdiction, but it was the administration’s lack of institutional control over the football program that triggered the response. Essentially, sanctions that stemmed from an irrational reverence for the sport have now triggered litigation designed to protect the same. Corbett alleges that the relationship between the sanctions and the sport is too attenuated, yet ironically, the case serves as a reminder that sometimes sports overshadow and often diminish more significant societal issues. This is, perhaps, most evident in the realm of college football.

-- Posted by Tim Epstein @ 1/03/2013 09:30:00 AM -- Comments (4) -- Post a Comment

4 Comments:

Were they asking for constitutional process? I read it more as asking for the process that the (private) organization guarantees and arguing that the failure to provide that process made the decision arbitrary and thus violative of the Sherman Act.

Good call on the "NCAA's out to get us" aspect of the complaint. Again, probably necessary to show unreasonableness, even if not (in the new lingo) "plausible."

Howard Wasserman -- 1/03/2013 10:41 AM

Howard - thanks for the thoughts. I do read this as they are seeking constitutional due process. In people attacking the NCAA process, so often the complaint is of lack of due process. I have yet to have one of these complaints, formal or otherwise, seek the "fair process" that the NCAA administrative law process is bound by its own rules to provide, as opposed to due process. There are instances in the complaint in which there is an attack on the NCAA for not providing the NCAA normal process, and other places in which due process is complained of as not being given.

Thanks

Tim Epstein -- 1/03/2013 11:33 AM

Steve Eder at the NY Times has done a solid job covering this. I gave him a quote on this yesterday.

http://www.nytimes.com/2013/01/04/sports/ncaafootball/smu-case-suggests-hard-road-for-corbetts-penn-state-suit.html?smid=pl-share

Tim Epstein -- 1/04/2013 12:42 PM

I agree the Commonwealth has some serious standing problems. But it is interesting to argue that Penn State essentially had a gun to its head and had little choice but to fall on its sword so the Commonwealth had to step in. What is missing in the Complaint--or not emphasized enough-- is the argument that the fine is unlawful. It has to get paid somehow that will ultimately come out of the state's pocket and will ultimately affect student services. Money is as they say fungible, so no matter what pocket you take it from, the other pocket is depleted.

ALAN MILSTEIN -- 1/05/2013 11:53 AM