Breaking the Monopsony Mirror: Evaluating the Collateral Market Procompetitive Justification in the Context of NCAA v. Alston

For over a century, the American universities that comprise the National Collegiate Athletic Association (“NCAA”) have agreed to regulate and restrict athlete compensation. Meanwhile, these universities, along with the coaches and administrators they employ, have secured enormous profits generated by the athletes’ labor. Over the last decade, current and former athletes have brought various lawsuits challenging the NCAA’s compensation restrictions under § 1 of the Sherman Act. The athletes have had moderate success in striking down certain restrictions, which recently led to the NCAA reversing a long-standing prohibition that had prevented athletes from profiting off their name, image, and likeness (“NIL”). Nevertheless, one compensation restriction still prevents the athletes from realizing their fair market value—the NCAA’s restrictions on compensation unrelated to education. This Note asserts that the contextual differences between restrictions employed by monopolies and monopsonies require courts to employ a different legal framework for evaluating a challenged restriction’s procompetitive effects. Accordingly, this Note proposes that courts should adopt a new two-part test to determine whether certain consumer benefits are sufficient to justify a monopsonist’s restrictions in a labor market. The proposed test is then applied to the NCAA’s remaining restrictions on compensation unrelated to education. Under the new test, courts would likely find that the NCAA’s restrictions on compensation unrelated to education violate § 1 of the Sherman Act.