The Shortcut That Saved Division III's Scholarship Ban in 2013 Is Gone. Now the NCAA Has to Defend It.

Three current and former Division III athletes, one of them a Pacific Lutheran defensive back, sued the NCAA on October 23 in federal court in Los Angeles. The case, Printz v. NCAA, challenges Division III Bylaw 15.01.3, which bars more than 400 schools from awarding any financial aid based on athletic ability. The complaint calls the rule an ongoing conspiracy to fix the price of Division III athletic labor at zero. It seeks triple damages for athletes who have competed in Division III since October 21, 2022, and an order ending the ban. Division III had about 211,000 athletes in championship sports last year, so a certified class could put billions of dollars at stake.

The claim is under Section 1 of the Sherman Act, which bars agreements that unreasonably restrain trade. Rules made by a group of competitors, like schools in a division agreeing on what they will pay athletes, are judged under the rule of reason: the plaintiffs must show harm to competition in a defined market, and the defendant can then justify the restraint as procompetitive.

Two earlier cases frame this one. In Rock v. NCAA in 2013, a federal court in Indiana dismissed a challenge to the Division III ban, treating NCAA amateurism rules as presumptively procompetitive, an idea drawn from the Supreme Court's 1984 Board of Regents decision. Then in NCAA v. Alston in 2021, the Supreme Court unanimously held that NCAA limits on athlete compensation get full antitrust scrutiny, and that the old language in Board of Regents did not give them a pass.

The quick read is that the ban plainly violates the Sherman Act. That may turn out to be right, but the more useful thing to say today is what has changed and what has not.

What has changed is the shortcut. Rock dismissed the Division III claims by treating the ban as presumptively procompetitive. Alston took that presumption away. After Alston, the NCAA cannot win by pointing to amateurism as a label. It has to defend the ban on the merits, with evidence that it makes the product better for the people who consume it. That alone makes this case far more likely to survive a motion to dismiss than Rock was.

What has not changed is the market. A plaintiff still has to define the market the restraint harms, and that is the wall that stopped the Ivy League scholarship case, which the Second Circuit affirmed dismissing in April. The plaintiffs here have an advantage the Ivy case lacked. That case attacked one conference's policy. This one attacks an NCAA-wide rule binding more than 400 schools, which is the structure Alston described as a multi-conference agreement and which the complaint leans on directly.

The NCAA's best argument is that Division III is a choice. Schools that want to give athletic scholarships can join Division I or II, so the Division III rule defines a product rather than restraining a market. That argument has force, and it will be the center of the case. But it is also the kind of product-definition defense Alston told courts to test with evidence rather than accept on faith. The shortcut that saved this rule in 2013 is gone.

The plaintiffs, on the early stages: Alston removed the presumption that ended Rock. The NCAA, on the merits: market definition is hard, and the choice argument is real. Division III schools hold the policy lever either way, since a win for the plaintiffs would let schools offer athletic aid, not force them to.

In 2013 a court called Division III's scholarship ban presumptively procompetitive. Alston took that presumption away. The NCAA now has to defend the rule on evidence, and market definition is where it will be won or lost.

Expect an NCAA motion to dismiss focused on market definition and the Division III choice argument. Watch whether the court treats Rock as still good law after Alston. That ruling will decide whether this becomes the next major college sports antitrust case.