## Facts

- The NCAA, a voluntary association of colleges, regulated intercollegiate football television rights.
- For the 1982–1985 seasons, the NCAA adopted a television plan intended to reduce the effect of live broadcasts on game attendance.
- The plan capped the total number of televised games, limited how many times any one school could appear on television, and prohibited member schools from selling broadcast rights outside the plan.
- The NCAA negotiated exclusive contracts with ABC and CBS that required minimum aggregate payments to participating schools and structured how games would be selected and televised.
- Oklahoma and Georgia, members of the College Football Association (CFA), negotiated a separate contract with NBC that would allow more appearances and increased revenue.
- The NCAA threatened disciplinary sanctions against schools that complied with the CFA–NBC contract rather than the NCAA plan.
- The schools sued, alleging the plan unlawfully restrained trade in the market for live college football television.

## Issues

1. Whether the NCAA’s football television plan restraining the sale of broadcast rights and limiting televised games violated §1 of the Sherman Act.
2. Whether the plan should be condemned per se or evaluated under the rule of reason given the special features of intercollegiate athletics.

## Decision

- The Supreme Court affirmed (7–2) an injunction against enforcement of the NCAA’s television plan.
- The Court held the plan was a horizontal restraint with significant anticompetitive effects in the market for live college football television.
- The Court applied the rule of reason, declining per se treatment because some horizontal cooperation is necessary to produce intercollegiate sports.
- Even under the rule of reason, the plan was an unreasonable restraint of trade because it fixed prices and restricted output without sufficient procompetitive justification.

## Legal Principles

- Horizontal restraints on price and output are central targets of §1 scrutiny and ordinarily indicate unreasonable restraint of trade.
- An association’s rules may be assessed under the rule of reason where some coordination among competitors is needed to create the product being sold.
- Under the rule of reason, the controlling question is whether the challenged restraint enhances competition; substantial price-fixing and output-limiting effects weigh heavily against legality.
- Setting minimum compensation for broadcast rights and limiting the number of televised games are anticompetitive restraints when they prevent the market from responding to consumer demand.
- Claimed goals such as preserving attendance, maintaining competitive balance, or protecting amateurism do not justify broad restraints on price and output absent a demonstrated, competition-enhancing connection and reasonable tailoring.

## Conclusion

The Court held that the NCAA’s centralized television plan for college football unlawfully restrained trade by fixing prices and limiting output in the live broadcast market, and that the asserted justifications did not outweigh the plan’s anticompetitive effects under the rule of reason.


Nat’l Collegiate Athletic Ass’n v. Bd. of Regents of Univ. of Okla., 468 U.S. 85 (1984)