The NCAA Response to PA lawsuit!!

UNITED STATES DISTRICT COURTMIDDLE DISTRICT OF PENNSYLVANIACOMMONWEALTH OFPENNSYLVANIA, THOMAS W.CORBETT, JR., GOVERNOR,
Plaintiff,
v.THE NATIONAL COLLEGIATEATHLETIC ASSOCIATION,
Defendant.::::::::::ELECTRONICALLY FILEDCivil Action No.:
1:13-cv-000060-YK
(THE HONORABLE YVETTEKANE)
DEFENDANT’S MEMORANDUM OF LAW IN SUPPORT OF
Thomas W. Scott (PA No. 15681)KILLIAN & GEPHART, LLP218 Pine StreetP.O. Box 886Harrisburg, PA 17108-0886Telephone: (717) 232-1851Email: tscott@killiangephart.comGregory L. Curtner,
PHV pending
Kimberly K. Kefalas,
PHV pending
SCHIFF HARDIN LLP350 South Main Street, Suite 210Ann Arbor, MI 48104Telephone: (734) 222-1500Facsimile: (734) 222-1501gcurtner@schiffhardin.comDate: February 7, 2013Everett C. Johnson, Jr.,
PHV pending
J. Scott Ballenger,
PHV pending
Roman Martinez,
PHV pending
LATHAM & WATKINS LLP555 Eleventh Street, NW, Suite 1000Washington, DC 20004-1304Telephone: (202) 637-2200Facsimile: (202) 637-2201everett.johnson@lw.com
Attorneys for Defendant The National Collegiate Athletic Association
Case 1:13-cv-00006-YK Document 10 Filed 02/07/13 Page 1 of 30
TABLE OF CONTENTSPage(s)
STATEMENT OF QUESTION INVOLVED
Whether the Complaint should be dismissed under Federal Rule of CivilProcedure 12(b)(6).
INTRODUCTION
In this case, the Governor of the State of Pennsylvania seeks to undo anagreement freely entered into b
y Pennsylvania State University (“PSU”) with the National Collegiate Athletic Association (“NCAA”) addressing the misconduct of
senior University leaders in covering up the crimes of former PSU Assistant
Football Coach Jerry Sandusky. PSU’s own investigat
ion concluded that
University leaders were aware of Sandusky’s crimes and failed to report them, at
least in part because of a desire to protect the football program. Based on thosefacts, PSU accepted a Consent Decree embodying sanctions and remedial measuresdesigned to change the football culture at PSU and ensure that competitive zealnever again facilitates child abuse.Pennsylvania law gives PSU the authority to manage its own athleticsprogram, join voluntary associations like the NCAA, and agree to contracts.
Governor Corbett is a member of PSU’s governing board, which voted to ratify the
Consent Decree. In this case the Governor seeks, under the guise of antitrust law,to overrule his fellow Trustees and usurp the discretion that the Legislaturedelegated to PSU. This lawsuit is an inappropriate attempt to drag the federal
Case 1:13-cv-00006-YK Document 10 Filed 02/07/13 Page 6 of 30
2courts into an intra-state political dispute. The remedial measures that Penn Stateagreed to were controversial, and have elicited strong feelings on all sides. Somethink they are too harsh, and some think they are too lenient. But none of thosefeelings have
anything
to do with the antitrust laws.This lawsuit should be dismissed on the pleadings for at least fourindependent reasons:First, under binding Third Circuit
precedent, the NCAA’s regulation of
college sports is subject to antitrust scrutiny only if it directly regulates economicactivity, like television contracts or the salary of coaches.
See Smith v. NCAA
, 139F.3d 180 (3d Cir. 1998). Enforcement of rules relating to program integrity andeligibility for competition is not regulation of
commerce
, and is outside the scopeof the Sherman Act. Indirect economic effects on businesses resulting from theNCAA imposing major sanctions are not uncommon, and do not alter the analysis.Second, even if the antitrust laws were applicable, the Complaint fails tostate a claim because the ethical standards enforced by the NCAA are part of whatmakes college athletics unique and distinctive. As the Supreme Court hasexp
lained, “
the NCAA plays a vital role in enabling college football to preserve itscharacter, and as a result enables a product to be marketed which might otherwisebe unavailable
.”
NCAA v. Bd. of Regents of the Univ. of Okla.
, 468 U.S. 85, 102(1984).
“In performing this role, [the NCAA’s]
actions widen consumer choice
Case 1:13-cv-00006-YK Document 10 Filed 02/07/13 Page 7 of 30
3not only the choices available to sports fans but also those available to athletes
and hence can be viewed as procompetitive
.”
Id.
The Third Circuit and numerousother courts have held that antitrust suits challenging NCAA enforcement of rulesdefining the unique character of college sports satisfy the antitrust rule of reasonand can be dismissed on the pleadings
Plaintiff contends that these sanctions exceed the NCAA’s appropriate role
as the regulator of college athletics, and that Sandusky’s conduct is merely a
criminal matter. But the Consent Decree is not about Jerry Sandusky; it isaddressed to the behavior of senior University officials, including the former headfootball coac
h, who learned of evidence of Sandusky’s crimes and chose not to act
for reasons that, as Penn State has acknowledged, included an inappropriate culture of reverence for the football program and a desire to protect it. The NCAA and its member institutions are entitled to conclude that they do not want tocondone a culture that places athletics above reporting crimes against children.  Plaintiff’s suggestion that these sanctions have nothing to do with the regulation of  athletic competition ignores this obvious and direct interest of the NCAA and itsmembers.Third, the Complaint fails to allege harm to economic competition in thethree (insufficiently pled) markets it identifies for higher education, athleticapparel, and football recruits. The Complaint does not allege that lessened  competition from Penn State has made it possible for other universities to raisetuition or the price of athletic apparel, or to reduce the number or quality of scholarships that they offer to student-athletes. Nor would such allegations beremotely plausible, given how large and robust these alleged nationwide marketswould be. Plaintiff alleges only that PSU, a single competitor, might beathletically disadvantaged by the Consent Decree, but the antitrust laws protect competition, not competitors.  Finally, Plaintiff is not suing on behalf of anyone who has antitrust injury orstanding to sue. PSU chose to compromise its differences with the NCAA byconsent decree, and that choice was ratified by the appropriate decision-makersunder Pennsylvania law.Parens patriae authority does not give Governor Corbettstanding to challenge that decision, when the citizens he claims to represent havenot themselves suffered antitrust injury. The complaint should be dismissed.
STATEMENT OF FACTS
The NCAA disagrees with almost every allegation in Plaintiff’s Complaint.
For purposes of this motion only, the NCAA accepts those allegations, assupplemented by documents that the Complaint itself incorporates by reference(i.e., the Consent Decree, the Freeh Report, and the NCAA’s Constitution and
Case 1:13-cv-00006-YK Document 10 Filed 02/07/13 Page 9 of 30
Bylaws), and facts appropriate for judicial notice.
See Buck v. Hampton Twp. Sch. Dist.
, 452 F.3d 256, 260 (3d Cir. 2006).
1The NCAA is a voluntary association of more than 1,000 colleges anduniversities that provides a framework for intercollegiate athletics competitionamong its members and works to preserve the tradition of college sports, including ideals of character, integrity, amateurism, and fair play. Compl. ¶¶22; NCAAAcademic and Membership Affairs Staff,
2011-12 NCAA Division I Manual
arts.1.2-1.3, 2.4 (2011)
(“Manual”)
, attached as Ex. A.
The NCAA’s Constitution explains that:For intercollegiate athletics to promote the character development of participants, to enhance the integrity of higher education and to promote civility in society,student-athletes, coaches, and all others associated withthese athletics programs and events should adhere to suchfundamental values as respect, fairness, civility, honestyand responsibility. These values should be manifest notonly in athletics participation, but also in the broadspectrum of activities affecting the athletics program.Manual art.  2.4. To that end, the NCAA’s Bylaws require “Exemplary Conduct” from coaches and administrators.
Id. art.
19.01.2. Such persons “
are, in the finalanalysis, teachers of young people ” and “[t] their own moral values must be socertain and positive that those younger and more pliable will be influenced by a1
If the Court believes that the NCAA has introduced any facts that wouldnecessitate converting this motion into a motion for summary judgment, we ask itto disregard those facts and decide this motion under Rule 12(b)(6).
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6fine example.
Much more is expected of them than of the less critically placed citizen
The NCAA’s member schools also have charged the NCAA “
to uphold the principle of institutional control of, and responsibility for, all intercollegiat
e sports.”
Id
In 2011, the nation was shocked by revelations that longtime PSU AssistantFootball Coach Jerry Sandusky had used his position to brutally abuse youngchildren. Compl. ¶¶36-40. Sandusky was subsequently convicted on 45 criminalcounts arising from these allegations.
PSU’s former President, its formerAthletic Director, and another senior official currently face felony charges for child endangerment arising from their failure to properly report evidence of Sandusky’s crimes.
 39.Shortly after Sandusky’s indictment, PSU’s Board of Trustees
commissioned former FBI Director and federal judge Louis Freeh to conduct anexhaustive independent investigation.
Id
. ¶41; Freeh Sporkin & Sullivan, LLP,
Report of the Special Investigative Counsel Regarding the Actions of ThePennsylvania State University Related to the Child Sexual Abuse Committed byGerald A. Sandusky
9 (2012)
(“Freeh Report”), attached as Ex.
B. The FreehReport “conclud[ed], among other things, that the most senior leaders of Penn
State had exhibited ‘total and consistent disregard … for the safety and welfare of Sandusky’s victims’ and had worked together to conceal Sandusky’s crimes for fear of bad publicity and out of sympathy for Sandusky.” Compl.
¶42.
Specifically, the Freeh Report concluded that a “culture of reverence for the football program that is ingrained at all levels of the campus community” contributed to those failures. Freeh Report 16-17.The NCAA informed PSU that its conduct was incompatible with th erequirements of honesty, moral integrity, and institutional control andresponsibility set forth in the NCAA Constitution and Bylaws. The University faced a formal inquiry and potential penalties, which could have included a multi-year ban on participation in football competition. Compl. ¶48.
In July 2012, PSU negotiated a Consent Decree with the NCAA in which it
“accepted the findings of the Freeh Report” and “acknowledged that those facts
constitute violations of the Constitutional and Bylaw principles described in the
[NCAA’s] letter.” Consent Decree between PSU and NCAA at 2 (July 23, 2012)
(“Consent Decree”)
, attached as Ex. C (citing Manual arts. 2.1, 2.4, 6.01.1, 6.4,10.01.1, 10.1, 11.1.1, 19.01.2). The University accepted a four-year ban on postseason play, a reduction in football scholarships, and vacatur of football winssince 1998. PSU further agreed to fund a $60 million endowment dedicated to preventing child sexual abuse and assisting its victims, and to implement the Freeh Report
’spolicy recommendations along with an Athletics Integrity Agreementaimed at reestablishing institutional control over the football program.
The Consent Decree explained the NCAA’s view that these sanctions were
necessary because Penn State’s acknowledged misconduct reflected “an unprecedented failure of institutional integrity leading to a culture in which afootball program was held in higher esteem than the values of the institution, thevalues of the NCAA, the values of higher education, and most disturbingly the values of human decency.”  It made clear that remedial action was
necessary “to change the culture that allowed this activity to occur and realign it in
a sustainable fashion with the expected norms and values of intercollegiateathletics
Penn State “waive[d] any claim to further process, including,without limitation, any right to a determination of violations by the NCAACommittee on Infractions, any appeal under NCAA rules, and any judicial process related to the subject matter of this Consent Decree.”
PROCEDURAL HISTORY
On January 2, 2013, Governor Corbett filed this lawsuit on behalf of the
Commonwealth of Pennsylvania alleging that the NCAA’s enforceme
nt of theConsent Decree violates the Sherman Act, 15 U.S.C. §1. The suit purports torepresent the interests of natural citizens of Pennsylvania, and asks this Court toenjoin the sanctions, including the Athletic Integrity Agreement and the remedialmeasures recommended in the Freeh Report, under the Clayton Act, 15 U.S.C.§26. Compl. ¶1, 42.
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LEGAL STANDARD
Dismissal is appropriate unless the Complaint “contain[s] factual allegationsthat, taken as a whole, render the plaintiff’s entitlement to relief plausible.”
W.Penn Allegheny Health Sys., Inc. v. UPMC
, 627 F.3d 85, 98 (3d Cir. 2010). “A claim has facial plausibility when the plaintiff pleads factual content that allowsthe court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.”
Ashcroft v. Iqbal
, 556 U.S. 662, 678 (2009). A complaint that pleads facts “‘merely consistent with’ a defendant’s liability … ‘stops short of the line between possibility and plausibility of “entitlement of relief.”’”
Id
.(quoting
Bell Atl. Corp. v. Twombly
, 550 U.S. 544, 556 (2007)).
ARGUMENTI.
THE COMPLAINT FAILS TO STATE A VIOLATION OF THESHERMAN ACTA.
The Third Circuit’s Decision In Smith Makes Clear That TheComplaint Must Be Dismissed
In Smith v. NCAA
, the Third Circuit considered an antitrust challenge to the NCAA’s enforcement of a rule prohibiting otherwise-eligible graduate studentsfrom competing at a different institution from where they completed theirundergraduate studies. 139 F.3d at 182-84. The Court affirmed the
district court’s dismissal of the complaint both because the rule did not regulate commercialactivity, and because it was so obviously pro competitive that any antitrust claim
could be dismissed on the pleadings.  Both holdings independentlyrequire dismissal here.
The NCAA’s Enforcement Action Was Not “Trade Or Commerce” Subject To Antitrust Scrutiny
The Sherman Act applies only to unreasonable restraints of “trade or commerce
It has “only limited applicability toorganizations”like the NCAA—“which have principally
noncommercial objectives.”
Smith
139 F.3d at 185-86 (emphasis added). The fact that an action has an “incidental economic effect” on commerce does not make it commercial.
Pocono Invitational Sports Camp, Inc. v. NCAA
drew a sharp “distinction between [the NCAA’s] commercial andnoncommercial activities,” holding that the Sherman Act has no application to NCAA rules and enforcement actions primarily addressing non-business aspects of college sports. 139 F.3d at 185-86 & n.4. The Third Circuit grounded that holding in caselaw from across the country, and numerous courts have relied on
Smith to dismiss antitrust complaints challenging NCAA rules addressing fair play,
Smith was later vacated on other grounds, 525 U.S. 459 (1999), but courtshave continued to apply its antitrust analysis as governing precedent.
See, e.g.
institutional integrity, academic standards, and other noncommercial aspects of college sports.
The Consent Decree rests on PSU’s acknowledgment that it violated key principles of the NCAA Constitution and Bylaws. Consent Decree 2-3. Thoseprinciples have nothing
to do with business or commerce, but instead establishbasic standards of honesty, ethical conduct, and institutional control that the NCAA’s members believe to be neces
sary to preserving the character and integrityof college athletics. For example, the “institution itself” must exercise “controland responsibility for the conduct of intercollegiate athletics” and cannot effectively cede that control to a revered coach or athletic program. Manual art.6.01.1. And all persons associated with athletic programs must: “adhere to such fundamental values as respect, fairness, civility, honesty,and responsibility,”
See, e.g.
Bassett v. NCAA
, 528 F.3d 426, 432-34 (6th Cir. 2008) (dismissingantitrust challenge to NCAA recruiting rules);
Bowers
, 475 F.3d at 535 n.11(dismissing antitrust challenge to NCAA eligibility rules because they seek to
promote “fair competition” in college sports);
see also Pocono
, 317 F. Supp. 2d at581-84 (recruiting rules are noncommercial);
Adidas Am., Inc. v. NCAA
, 40 F.Supp. 2d 1275, 1286 (D. Kan. 1999) (rules governing advertising on uniforms andequipment arenoncommercial because they “preserve the integrity and uniquenessof intercollegiate sports”);
Brentwood Acad. v. Tenn. Secondary Sch. Athletic
Ass’n
, No. 97-1249, 2008 U.S. Dist. LEXIS 55312, at *9-13 (M.D. Tenn. July 18,
2008) (recruiting rules analogous to NCAA’s rulesare noncommercial);
Silicon Economics, Inc. v. Fin. Accounting Found
., No. 11-163, 2011 U.S. Dist. LEXIS92322, at *22 (D. Del. Aug. 17, 2011) (NCAA enforcement action is exempt fromantitrust scrutiny when it involves “
academic rules or player-eligibilityrequirements  “act with honesty and sportsmanship at all times so that intercollegiate athletics as a whole, their institutions and they, as individuals, shallrepresent the honor and dignity of fair play and the generally recognizedhigh standards associated with whole some competitive sports,” and act as “teachers of young people,” not just by avoiding “improper conduct [and] questionable acts” but by demonstrating “
moral values…so certain and positive that those younger and more pliable will beinfluenced by a fine example.
The NCAA’s standards for institutional control and ethical behavior protect a culture of amateur athletics in which on-field competition is tempered by ashared commitment to ideals of character, sportsmanship, and responsibility. PSUhas acknowledged that it violated those ideals, and the NCAA Constitution, byignoring evidence of serial sex abuse of young children to protect PSU, andespecially its football program, from bad publicity. Consent Decree 2-4. The NCAA’s response to a violation of this nature is not a restraint of commerce but anassertion of basic values, and is not an appropriate subject for an antitrust lawsuit. The Complaint is full of allegations concerning the NCAA’s process and motivations. PSU chose to resolve the NCAA investigation by Consent Decreeand explicitly waived any further process. Regardless, alleged violations of internal NCAA procedures would not change the noncommercial nature of the rules at issue or otherwise constitute an antitrust violation.
The Complaint’sscurrilous allegations that the NCAA’s President was motivated by a desire to change the NCAA’s supposed “reputation for being soft on discipline” (Compl.
¶¶34-36) or to garner positive publicity (Compl. ¶56), or that PSU was sanctioned
only because it “simply could not fight back” (Compl.¶59), also do not change the character of the rules and have nothing to do with antitrust law.
The NCAA’s Enforcement Action Was Procompetitive And Easily Satisfies The Rule Of Reason
Even if the antitrust laws did apply to the NCAA’s enforcement of its institutional control and ethical standards, those standards are so clearly pro competitive that this lawsuit should be dismissed on the pleadings. The NCAArules PSU violated—and PSU’s assent to their enforcement in the ConsentDecree preserve the character of NCAA athletics and thereby provide consumerswith a distinctive choice that would otherwise not exist in the marketplace.
Nw. Wholesale Stationers, Inc. v. Pac. Stationery & Printing Co
 “the absence of procedural safeguards can in no sense determine
the antitrust analysis,as “the antitrust laws do not … impose on joint ventures a
requirement of process
The Complaint declares that the NCAA wanted to “boost the competing football programs of certain member colleges and universities by removing from competition one of the leading competitors,” Compl. ¶65, but contains no factual allegations sufficient to support a reasonable inference that this conclusory andoutlandish accusation is true.
Antitrust challenges to NCAA rules and enforcement actions are governed by the “rule of reason,” which turns on whether the challenged conduct ultimately promotes or impairs economic competition.
In other contexts, the rule of reason requires extensive analysis. But the Supreme Court has made clear that sports leagues “are not trapped by antitrust law.”
Am. Needle
.Because competition cannot exist at all without rules and enforcement, and because NCAA regulation makes possible a distinctive product that otherwise could not exist, there is a strong presumption “that most of the regulatory controlsof the NCAA are … procompetitive.”
at 2216 (sports league rules are “likely to survive the Rule of Reason”). In the context of athletics the rule of reason therefore often “may notrequire a detailed analysis” and can “be applied in the twinkling of an eye”—inother words, at the motion-to-dismiss stage.
the Third Circuit held that the challenged player-eligibility rule was not only non
commercial, but also “plainly” valid under the rule of reason because it “further[ed] the NCAA’s goal of fair competition and the survival of intercollegiate athletics.” 139 F.3d at 187. Courts across the country have dismissed challenges to NCAA rules and enforcement actions based on that reasoning. In Banks v. NCAA, for example, the Seventh Circuit dismissed a
lawsuit like this one under the rule of reason because NCAA regulations “preserve
the honesty and integrity of intercollegiate athletics and foster fair competition among the parti
cipating amateur college students.” 977 F.2d 1081, 1089-90 (7thCir. 1992).
Likewise, in McCormack v. NCAA, the Fifth Circuit dismissed a challenge to the NCAA’s player
eligibility rules because they “preserve thecharacter and quality” of college sports
“and as a result enable[] a product to bemarketed which might otherwise be unavailable.” 845 F.2d 1338, 1343-45 (5thCir. 1988) (quotation marks omitted).The PSU Consent Decree is obviously procompetitive for similar reasons. It“enable[s] college football to preserve its character” by expressing the judgment of the NCAA and its members about the importance of institutional control, honesty,and basic morality in athletic programs.
The Complaint’s suggestion that the sanctions are not “reasonably related” to the NCAA’s appropriate role as the regulator of athletics ignores facts thatPSU has accepted, and that the Complaint does not dispute: that responsibleofficials ignored evidence of serious criminal behavior in part because of institutional fear of the football program and a desire to protect it
. Those issues have everythingto do with athletics, and the inappropriate conduct that sports cansometimes inspire, if not appropriately restrained. As in Smiththe NCAA’s action
“so clearly survives a rule of reason analysis” that the Court should “not hesitateupholding it” by dismissing Plaintiff’s Complaint. 139 F.3d at 187.
The Complaint Fails To Allege Any Anticompetitive Effects InThe Relevant Markets
The Complaint also fails to state a claim because it does not allege any threatof substantial anticompetitive effects in the alleged relevant markets.Anticompetitive effects
—such as increased prices, reduced output, and reducedquality—are a fundamental element of any Sherman Act claim.
Howard Hess Dental Labs, Inc. v. Den
tsply Int’l, Inc.
 (“An antitrust plaintiff must prove that challenged conduct affected the
prices, quantity or quality of goods or services.” (quotation marks omitted)).
Plaintiff identifies three separate “nationwide” markets that the sanctionsallegedly will purportedly harm: (1) “postsecondary education,” (2) “Division Ifootball players,” and (3) “the sale of college football-related apparel andmemorabilia.” Compl.69. But he pleads no facts that could support a reasonableinference that the Consent Decree will cause prices to rise, output to fall, or quality
to decline on a marketwide basis in any of these purported “markets.”Plaintiff alleges that the sanctions will harm these markets “through theremoval of a major competitor”—
. But the antitrust laws “were enacted for the protection of competition, not competitors.”
Brunswick Corp. v.
Plaintiff must show “a wider impact on the competitive market” and not merely
impairment of an individual competitor.Eichorn v. AT&T Corp.
“The impact on the market is the key focus, rather than onthe individual participants in the market.
Plaintiff fails to allege that any harm to PSU’s football prowess will result in any anticompetitive economic harm—i.e., tuitionincreases, reductions in scholarship opportunities, or increases in apparel costs—injurious to consumers in any alleged market. Indeed, most of th
e “harms” to PSU that the Complaint anticipates are not even harms to PSU as an economiccompetitor, but as an athletic competitor. The antitrust laws do not protect
athletic competition.
Nat’l Hockey League Players’ Ass’n v. Plymouth Whalers
Hockey Club Even if Plaintiff had alleged a genuine reduction of competition in the
identified “markets,” that allegation is entirely implausible and thus insufficient
Town Sound & Custom Tops, Inc. v. Chrysler Motors Corp.
, (antitrust claim “[o]bviously” lacksmerit “if the plaintiff cannot come up wi
th evidence of injury to competition, not simply to the plaintiffs themselves”);
, 823 F.2d 829, 832 (4th Cir. 1987) (“The elimination of a single competitor standing alone, does not prove anti-competitive effect.”).
Assuming arguendo that the markets alleged in theComplaint are proper commercial markets, on Plaintiff’s own allegations thosemarkets would be nationwide, including hundreds of “competitors.” It is exceptionally unlikely that sanctions temporarily impairing one school’s prowess
on the football field would render any of these robust nationwide economicmarkets less competitive, such that Stanford suddenly could raise tuition, Michigancould offer fewer or less valuable football scholarships, or Notre Dame could charge more for branded football jerseys. This Court can apply “experience” and“common sense,” determine that Plaintiff’s conclusory
use of antitrust language is not sufficient to state a claim in the absence of factualallegations supporting a reasonable inference of harm to competition
PLAINTIFF LACKS STANDING TO SEEK INJUNCTIVE RELIEF
Section 16 of the Clayton Act allows
parens patriae suits for injunctiverelief. But Plaintiff must still satisfy the ordinary requirements of antitrust  Further, none of plaintiff’s alleged “markets” are sufficiently defined
byreference to reasonable consumer substitutability.See, e.g.
Plaintiff does not explain, for example, which programs compete for “top footballtalent” in the supposed recruiting “market,” or what products consumers would see as potential substitutes in the alleged collegiate apparel market, which Plaintiff a pparently intends to limit to only those products with a “national ‘brand.’”
None of the alleged threatened harms to Pennsylvania citizens
constitute “antitrust injury,” an essential component of antitrust standing.
“[An]injury, although causally related to an antitrust violation, nevertheless
will not qualify as an ‘antitrust injury’ unless it is attributable to … a competition
reducing aspect or effect of the defendant’s behavior.” The plaintiff’s harm also must have been proximately caused by the defendant’s antitrust violation; derivative or remote harms are not antitrust injury. requiring proximate cause for purposes of injunctive relief under Section 16);
, 80 F.3d 842, 856 (3d Cir. 1996) (same). TheThird Circuit has explained that, as a general mat
ter, “the class of plaintiffs capable of satisfying the antitrust-injury requirement is limited to consumers andcompetitors in the restrained market, and to those whose injuries are the means by (noting that usual “limitations on standing generallyapply” to
parens patriae suits and that “the state as
parens patriae must still showthat residents on whose behalf it sues have a cause of action and could satisfy the usual rules of proximate causation and antitrust injury”);
New York v. Microsoft Corp
0which defendants seek to achieve their anticompetitive ends.
Plaintiff alleges threatened harm to individuals and businesses whoseeconomic fortunes indirectly depend on public enthusiasm for PSU football.Compl. ¶¶75-77. He also points to the negative economic effects of an alleged future decline in PSU’s spending on capital improvements, on the potential need for students and/or the Commonwealth to fund the $60 million fine, and on harm to students whose “educational and community experience” will allegedly suffer if PSU wins fewer football games.
None of these (highly speculative) alleged future injuries are the result of
increased prices or lower outputs in the Complaint’s alleged “markets
.These Pennsylvania citizens and businesses are not suffering harm as
“consumers” or “competitors” in those markets, and the harms they allegedly may suffer certainlyare not the “means by which the [NCAA] seek[s] to achieve [any] anticompetitiveends.”
 The Complaint’s allegation is that those persons will suffer harm in other markets (restaurants, hotels,etc .) as a derivative consequence of some alleged future harm to Penn State’s football prowess. That sort of spillover effect is far too remote and indirect to qualify as “antitrust injury.”
(rejecting antitrust standing based on remoteness and indirectness of harm);
Courts regularly deny antitrust standing to parties who suffer harm only indirectly, as the result of antitrust violations directed by the defendant at a third party.
Mr. Sandusky’s criminal conduct and PSU’s failure to take action to prevent
it, have fueled a public and political debate. Some argue that PSU is an innocentvictim. Others think that the Consent Decree was too lenient, and that the attacks on that agreement only confirm the Freeh Report’s conclusion that football fever has caused some to lose all perspective. But even accepting Plaintiff’s baselessfactual allegations as true, the target of the NCAA’s actions here was PSU,not thePennsylvania citizens on whose behalf Plaintiff claims to sue. And there is noquestion that PSU has made the deliberate decision that its interests are best servedby resolving the issues via the Consent Decree, instead of by denyingresponsibility, fighting the charges, and miring the University in the spotlight of national shame for years to come.Allowing
this lawsuit to go forward based on Plaintiff’s novel andunfounded theories of collateral harm would not only undermine PSU’s desire to move forward, it would radically expand the scope of plaintiffs with standing tobring antitrust claims in future cases. The Supreme Court and Third Circuit have rigorously policed the limits on antitrust standing. This Court should enforce thoselimits and dismiss this case.
CONCLUSION
For all of the foregoing reasons, the Complaint should be dismissed, in itsentirety, with prejudice.
Respectfully submitted,Everett C. Johnson, Jr.,
PHV pending
J. Scott Ballenger,
PHV pending
Roman Martinez,
PHV pending
LATHAM & WATKINS LLP555 Eleventh Street, NW, Suite 1000Washington, DC 20004-1304Telephone: (202) 637-2200Facsimile: (202) 637-2201everett.johnson@lw.comGregory L. Curtner,
PHV pending
Kimberly K. Kefalas,
PHV pending
SCHIFF HARDIN LLP350 South Main Street, Suite 210Ann Arbor, MI 48104Telephone: (734) 222-1500Facsimile: (734) 222-1501gcurtner@schiffhardin.comDate: February 7, 2013 /s/Thomas W. ScottThomas W. Scott (PA No. 15681)KILLIAN & GEPHART, LLP218 Pine StreetP.O. Box 886Harrisburg, PA 17108-0886Telephone: (717) 232-1851Email: tscott@killiangephart.com
Attorneys for Defendant The National Collegiate Athletic Association
CERTIFICATE OF LOCAL RULE 7.8(b)(2) COMPLIANCE
I hereby certify that this brief complies with the type-volume limitation setforth in Local Rule 7.8(b)(2). This brief contains 4,979 words.Date: February 7, 2013 /s/Thomas W. ScottThomas W. Scott (PA No. 15681)KILLIAN & GEPHART, LLP218 Pine StreetP.O. Box 886Harrisburg, PA 17108-0886Telephone: (717) 232-1851Facsimile: (717) 238-0592tscott@killiangephart.com
Attorney for Defendant The National Collegiate Athletic Association
24
CERTIFICATE OF SERVICE
The undersigned hereby certifies that I am this day serving a copy of
Defendant’s Memor
andum in Support of Motion to Dismiss upon the persons andin the manner indicated on the attached Service List.Date: February 7, 2013 /s/Thomas W. ScottThomas W. Scott (PA No. 15681)KILLIAN & GEPHART, LLP218 Pine StreetP.O. Box 886Harrisburg, PA 17108-0886Telephone: (717) 232-1851Facsimile: (717) 238-0592tscott@killiangephart.com
Attorney for Defendant The National Collegiate Athletic Association
Case 1:13-cv-00006-YK Document 10 Filed 02/07/13 Page 29 of 30
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SERVICE LIST
James D. Schultz, General Counsel
Governor’s Office of General Counsel
Commonwealth of Pennsylvania333 Market Street, 17
th
FloorHarrisburg, PA 17101Telephone: (717) 783-6563Facsimile: (717) 787-1448 jamschultz@pa.gov
First Class U.S. Mail,Postage Prepaid
Jarad W. Handelman, Executive Deputy GeneralCounsel
Governor’s
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FloorHarrisburg, PA 17101Telephone: (717) 783-6563Facsimile: (717) 787-1448 jhandelman@pa.gov
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Melissa H. Maxman, Esquire
COZEN O’CONNOR
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Case 1:13-cv-00006-YK Document 10 Filed 02/07/13 Page 30 of 30
BRENTWOOD ACADEMY v. TENNESSEE SECONDARY SCHOOLSATHLETIC ASSOCIATION and RONNIE CARTER, Executive Director andIndividuallyNO. 3:97-1249UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OFTENNESSEE, NASHVILLE DIVISION
2008 U.S. Dist. LEXIS 55312
;
2008-2 Trade Cas. (CCH) P76,317
July 18, 2008, FiledPRIOR HISTORY:
Brentwood Acad. v. Tenn.Secondary Sch. Ath. Ass'n, 2001 U.S. App. LEXIS 23759(6th Cir., Oct. 29, 2001)
COUNSEL: [*1]
For Brentwood Academy, Plaintiff:Abigail Turner, H. Lee Barfield, II, Ross I. Booher,LEAD ATTORNEYS, W. Brantley Phillips, Jr., Bass,Berry & Sims, Nashville, TN; James Franklin Blumstein,LEAD ATTORNEY, Vanderbilt Legal Clinic VanderbiltSchool of Law, Nashville, TN.For Tennessee Secondary School Athletic Association,Defendant: Maurice E. Stucke, LEAD ATTORNEY,University of Tennessee College of Law, Knoxville, TN;Richard Lee Colbert, LEAD ATTORNEY, Courtney L.Wilbert, Colbert & Winstead, Nashville, TN.For Ronnie Carter, Executive Director of the TennesseeSecondary Schools Athletic Association and individually,Defendant: Richard Lee Colbert, LEAD ATTORNEY,Courtney L. Wilbert, Colbert & Winstead, Nashville, TN.
JUDGES:
TODD J. CAMPBELL, UNITED STATESDISTRICT JUDGE.
OPINION BY:
TODD J. CAMPBELL
OPINION
MEMORANDUMPending before the Court are Plaintiff's Motion forJudgment in its Favor on Equal Protection Claim (DocketNo. 349); Plaintiff's Renewed Motion for SummaryJudgment on Antitrust Claims (Docket No. 351); andDefendant's Motion for Summary Judgment (Docket No.354).For the reasons stated herein, Plaintiff's Motion forJudgment in its Favor on Equal Protection Claim (DocketNo. 349) is DENIED; Plaintiff's
[*2]
Renewed Motionfor Summary Judgment on Antitrust Claims (Docket No.351) is DENIED; and Defendant's Motion for SummaryJudgment (Docket No. 354) is GRANTED.INTRODUCTIONDefendant Tennessee Secondary Schools AthleticAssociation ("TSSAA") is a not-for-profit membershipcorporation organized to regulate interscholastic sportsamong its members, which include some 290 public and55 private high schools in Tennessee.
TennesseeSecondary School Athletic Ass'n v. Brentwood Academy,551 U.S. 291, 127 S.Ct. 2489, 2492, 168 L. Ed. 2d 166 (2007)
. Brentwood Academy is one of those privateschools. Id.
1
The TSSAA is a state actor for purposes of the Constitution,
Brentwood Academy v. TennesseeSecondary Schools Athletic Ass'n., 531 U.S. 288, 121
Page 1
Case 1:13-cv-00006-YK Document 10-1 Filed 02/07/13 Page 1 of 7
S.Ct. 924, 148 L. Ed. 2d 807 (2001)
, but it is not entitledto antitrust immunity.
Brentwood Academy v. TennesseeSecondary Schools Athletic Ass'n, 442 F.3d 410, 443 (6thCir. 2006)
.1 Defendant Ronnie Carter, against whomPlaintiff brought its constitutional claims, wasdismissed from this case based upon qualifiedimmunity.This case has a long history, having producedopinions in this Court, in the Sixth Circuit Court of Appeals, and in the U.S. Supreme Court. For purposes of the pending Motions, Plaintiff argues two
[*3]
claims:(1) that the TSSAA "Recruiting Rule" violates the equalprotection rights of Brentwood Academy and (2) that theTSSAA has violated the antitrust laws of the UnitedStates, specifically Sections 1 and 2 of the Sherman Act,
15 U.S.C. §§ 1
and
2
. Defendant contends that there isonly one remaining claim, the antitrust claim, and that itis entitled to summary judgment on that claim.EQUAL PROTECTIONInitially, the Court must address Defendant'sargument that the equal protection claim is not properlybefore the Court, having been determined in an earlieropinion by this Court and not appealed by Plaintiff. In itsfirst opinion to address Plaintiff's equal protection claim,this Court stated:It is axiomatic that a Court should notrule upon constitutional questionsunnecessarily. Given the other rulings of this Court in favor of BrentwoodAcademy, it is unnecessary for the Courtto reach the equal protection ("as writtenand as applied") and substantive dueprocess ("as written") issues. Accordingly,the Court declines to make findings of factor conclusions of law on these issues.
Brentwood Academy v. TSSAA, 304 F.Supp.2d 981, 1009(M.D. Tenn. 2003)
(citations omitted).Defendant
[*4]
contends that, because Plaintiff didnot include the equal protection claim in its appeal, thatclaim is now barred. As indicated above, however, thisCourt never reached the merits of the equal protectionclaim. Therefore, there has been no final ruling on themerits of that claim. Plaintiff has now filed a Motion forJudgment on the Record on the equal protection claim.Accordingly, that claim will be considered under
Fed. R.Civ. P. 52
, based upon the evidence at trial, and not underthe standards of
Fed. R. Civ. P. 56
or
12
.The
Equal Protection Clause
commands that noState shall deny to any person within its jurisdiction theequal protection of the laws.
U.S. Const., amend. XIV, §1
. To establish a claim under the
Equal ProtectionClause
, a plaintiff must demonstrate that the governmenttreated the plaintiff disparately as compared to similarlysituated persons and that such disparate treatment eitherburdens a fundamental right, targets a suspect class, orhas no rational basis.
Club Italia Soccer & Sports Org. v.Charter Township of Shelby, Mich., 470 F.3d 286, 298 (6th Cir. 2006)
; see also
Engquist v. Oregon Dept. of Agr., 128 S. Ct. 2146, 170 L. Ed. 2d 975 (2008)
.Plaintiff's First Amended Complaint
[*5]
allegesthat the TSSAA Recruiting Rule, on its face and asapplied to Brentwood Academy, violates the
EqualProtection Clause
by discriminating against certainspeech based on its content and based on the identity of the speaker. Docket No. 205. Plaintiff alleges that theclassifications used by the TSSAA in regulating speechimpinge on Brentwood Academy's fundamental
First Amendment
rights, are not necessary to promotecompelling governmental interests, and therefore areunconstitutional. Id.Plaintiff does not assert that it is a member of asuspect class. Plaintiff contends that Defendant burdenedits fundamental
First Amendment
rights. The SupremeCourt has already ruled, however, that Defendant did notunconstitutionally burden Plaintiff's
First Amendment
rights.
2
That finding is the law of this case. Therefore,the Court finds, as a matter of law, that Defendant has notburdened Plaintiff's fundamental
First Amendment
rights.Plaintiff asserts no other "fundamental right" which hasallegedly been burdened.2 "The anti-recruiting rule strikes nowhere nearthe heart of the
First Amendment
."
127 S.Ct. at 2493
. "TSSAA's limited regulation of recruitingconduct poses no significant
First Amendment
[*6]
concerns."
Id. at 2495
. ". . . the
First Amendment
does not excuse Brentwood fromabiding by the same anti-recruiting rule thatgoverns the conduct of its sister schools."
Id. at 2496
.Page 22008 U.S. Dist. LEXIS 55312, *2; 2008-2 Trade Cas. (CCH) P76,317
Case 1:13-cv-00006-YK Document 10-1 Filed 02/07/13 Page 2 of 7
Because neither a fundamental right nor a suspectclass is at issue, the rational basis standard applies.
Michael v. Ghee, 498 F.3d 372, 379 (6th Cir. 2007)
(citing
Club Italia Soccer & Sports, 470 F.3d at 298
).Equal protection claims can be brought by a "class of one," where the plaintiff alleges that the state treated theplaintiff differently from others similarly situated and thatthere is no rational basis for such difference in treatment.
Warren v. City of Athens, Ohio, 411 F.3d 697, 710 (6thCir. 2005)
.Under rational basis scrutiny, government actionamounts to a constitutional violation only if it is sounrelated to the achievement of any combination of legitimate purposes that the Court can only conclude thatthe government's actions were irrational.
Michael, 498 F.3d at 379
. Where no suspect class or fundamental rightis implicated, governmental action subject to rationalbasis scrutiny must be sustained if
any
conceivable basisrationally supports it.
Trihealth, Inc. v. Board of Comm'rs. Hamilton County, Ohio, 430 F.3d 783, 790(6th Cir. 2005)
.
[*7]
Rational basis review begins with astrong presumption of constitutionality.
Graham v. Mukasey, 519 F.3d 546, 551 (6th Cir. 2008)
. Plaintiff bears the burden of demonstrating that Defendant lacks arational basis, and it may satisfy this burden either bynegating every conceivable basis which might supportDefendant's actions, or by demonstrating that thechallenged actions were motivated by animus or ill-will.
3
Id.3 The Sixth Circuit has expressly found thatthere is no evidence to suggest that Defendantmaliciously and intentionally abused its stateauthority in order to injure Brentwood in thiscase.
442 F.3d at 432
.This Court, the Sixth Circuit, and the U.S. SupremeCourt have all found that Defendant had substantialgovernmental interests in establishing and enforcing theRecruiting Rule. See
304 F.Supp.2d at 994
;
442 F.3d at 425-26
;
127 S.Ct. at 2495-96
. Those interests
4
clearlywithstand rational basis review. The Court finds, as amatter of law, that the TSSAA's challenged actions wererelated to the achievement of its legitimate purposes andwere rational. Therefore, Plaintiff has not carried itsburden of establishing that the Recruiting Rule violatesthe
Equal Protection Clause
.4 Those
[*8]
interests are (1) keeping highschool athletics subordinate to academics, (2)protecting student athletes from exploitation, and(3) fostering a level playing field betweenschools. See, e.g.,
304 F.Supp. 2d 981, 994
.Accordingly, Plaintiff's Motion for Judgment in itsFavor on Equal Protection Claim (Docket No. 349) isDENIED, and Defendant's Motion for SummaryJudgment (Docket No. 354) is GRANTED with regard toPlaintiff's equal protection claim.ANTITRUST
5
5 Summary judgment "should be rendered if thepleadings, the discovery and disclosure materialson file, and any affidavits show that there is nogenuine issue as to any material fact and that themovant is entitled to judgment as a matter of law."
Fed. R. Civ. P. 56(c)
. In deciding a motionfor summary judgment, the court must view thefactual evidence and draw all reasonableinferences in favor of the nonmoving party.
Meyers v. Columbia/HCA Healthcare Corp., 341F.3d 461, 466 (6th Cir. 2003)
The Court, withregard to Plaintiff's antitrust claims, hasconsidered the complete record filed in supportand opposition to the pending Motions.Section One of the Sherman Act provides that everycontract, combination or conspiracy in restraint
[*9]
of trade or commerce is illegal.
15 U.S.C. § 1
. Thus,Plaintiff must first show that the challenged restraintinvolves trade or commerce.
Bassett v. NationalCollegiate Athletic Ass'n ("NCAA"), 528 F. 3d 426, 433(6th Cir.2008)
;
Pocono Invitational Sports Camp, Inc. v. NCAA, 317 F.Supp.2d 569, 580 (E.D. Pa. 2004)
. If therestraint is not commercial, it cannot be analyzed underthe antitrust laws. Id.The three "restraints" which Plaintiff alleges violatedthe antitrust laws in this case are (1) the DivisionI/Division II split for football in the TSSAA,
6
(2) theRecruiting Rule, and (3) the punishment exacted uponPlaintiff for violation of the TSSAA By-laws. Defendantcontends that none of the challenged actions restrainstrade or commerce.6 A Bylaw promulgated by the TSSAA createdtwo "divisions" (Division I and Division II) forchampionship tournament competition within theTSSAA. Division II is for schools which provideneed-based financial aid to varsity athletes andPage 32008 U.S. Dist. LEXIS 55312, *6; 2008-2 Trade Cas. (CCH) P76,317
Case 1:13-cv-00006-YK Document 10-1 Filed 02/07/13 Page 3 of 7
any other school which chooses to participate inDivision II. Division I is for all the rest of themember schools. The Division I/Division IIclassification applies only to tournamentcompetition, not to regular season
[*10]
play.The dispositive inquiry in determining whether thealleged restraints are commercial in nature is whether therules (or enforcement thereof) are commercial, notwhether the TSSAA is commercial.
Worldwide Basketball and Sport Tours, Inc. v. NCAA, 388 F.3d 955,959 (6th Cir. 2005)
;
Bassett at 433
. If the rulesthemselves and the corresponding sanctions are notcommercial, then the enforcement of those rules cannotbe commercial. Id.In Bassett, the court found that Section One of theSherman Act did not apply to the NCAA's enforcementof its rules on recruiting student athletes, because thatenforcement was not a restraint of trade or commerce.
Bassett at 434
. Similarly, in
Smith v. NCAA, 139 F.3d 180 (3d Cir. 1998)
,
vacated on other grounds, NCAA v.Smith, 525 U.S. 459, 119 S. Ct. 924, 142 L. Ed. 2d 929(1999)
, the court held that the NCAA's eligibility ruleswere not commercial activity covered by the ShermanAct. See also
Gaines v. NCAA, 746 F.Supp.738 (M.D.Tenn. 1990)
(NCAA eligibility rules are not subject toantitrust analysis).Plaintiff has not demonstrated a relevant differencebetween the NCAA's recruiting rules and the TSSAA'sRecruiting Rule for purposes of this antitrust analysis.Indeed, Plaintiff has
[*11]
admitted that the TSSAA islike the NCAA. Docket No. 223, n. 2. Further, Plaintiff has not demonstrated a relevant difference between theNCAA's enforcement of its eligibility rules in
Bassett
andthe TSSAA's enforcement of its Recruiting Rule in thiscase. Plaintiff's attempt to distinguish Bassett is notpersuasive. Bassett involved the NCAA recruiting rulesand an alleged infraction of those rules. The court foundthat the NCAA recruiting rules, like the eligibility rulesin
Smith
, were explicitly non-commercial.
Bassett at 433
."In fact, those rules are
anti-commercial
and designed topromote and ensure competitiveness amongst NCAAmember schools." Id.(emphasis in original).Just as the recruiting rules in the NCAA are"anti-commercial" and designed to promote and ensurecompetitiveness amongst NCAA member schools, theRecruiting Rule of the TSSAA, as noted above, has beenfound to promote similar, if not identical, interests. See
304 F.Supp.2d at 994
(keeping high school athleticssubordinate to academics, protecting student athletesfrom exploitation, and fostering a level playing fieldbetween schools);
442 F.3d at 425-26
;
127 S.Ct. at 2495-96
.In
NCAA v. Board of Regents of Univ. of Oklahoma,468 U.S. 85, 104 S. Ct. 2948, 82 L. Ed. 2d 70 (1984)
,
[*12]
the Supreme Court held that the NCAA'srestrictions on television broadcasts were commercial innature and subject to the Sherman Act. In so doing,however, the Court distinguished television broadcastsfrom the challenged conduct in this case by stating:It is reasonable to assume that most of the regulatory controls of the NCAA are justifiable means of fostering competitionamong amateur athletic teams andtherefore procompetitive because theyenhance public interest in intercollegiateathletics. The specific restraints onfootball telecasts that are challenged inthis case do not, however, fit into the samemold as do rules defining the conditions of the contest, the eligibility of participants,or the manner in which members of a jointenterprise shall share the responsibilitiesand the benefits of the total venture.
Id. at 2969
.
7
7 The Court stated in Gaines that there is a cleardifference between the NCAA's efforts to restrictthe televising of college football games and theNCAA's efforts to maintain a discernible linebetween amateurism and professionalism andprotect the amateur objectives of NCAA collegefootball by enforcing the eligibility rules.
Gaines,746 F.Supp. at 743
.
[*13]
The challengedrestraints in this case are more like the efforts of the NCAA to maintain amateurism in collegesports than the efforts to restrict televising games.The Court finds that, for the reasons stated in theabove-cited cases, neither the Division I/Division IIfootball split, the Recruiting Rule, nor the punishmentexacted against Plaintiff for violation of the RecruitingRule involves trade or commerce as required for provingviolation of the antitrust laws. The purposes of thechallenged restraints in this case are pro-competitive andPage 42008 U.S. Dist. LEXIS 55312, *9; 2008-2 Trade Cas. (CCH) P76,317
Case 1:13-cv-00006-YK Document 10-1 Filed 02/07/13 Page 4 of 7
relate to the promotion of fair athletic competition, not togiving Defendant any commercial advantage. Plaintiff has not proven otherwise.Thus, because Plaintiff has not carried its burden
8
of showing that the challenged restraints affect trade orcommerce, Plaintiff has not shown that the Defendant'sactions are prohibited under Section One of the ShermanAct, and Plaintiff's antitrust claim under Section Onefails.8 Because Plaintiff insists that the
per se
approach or the "quick look" analysis, discussedbelow, applies in this case, Plaintiff proceeds onthe assumption that the burden of proof hasshifted to Defendant. To the contrary,
[*14]
theultimate burden remains on the Plaintiff todemonstrate that the alleged restraints involvetrade or commerce. Plaintiff has not carried thatburden.Alternatively, even if Plaintiff had shown that thechallenged restraints were restraints on trade orcommerce, Plaintiff would still have to show that thechallenged restraints unreasonably restrain trade in therelevant market, and Plaintiff has not carried that burden.In this regard, the courts use two analyticalapproaches to determine whether conduct unreasonablyrestrains trade, the
"per se
rule" and the "rule of reason."
National Hockey League Players Ass'n v. PlymouthWhalers Hockey Club, 325 F.3d 712, 718 (6th Cir. 2003)
.The
per se
rule identifies certain practices that areentirely void of redeeming competitive rationales. Id. Forthe reasons stated above, specifically the substantial,non-commercial, governmental interests underlying thealleged restraints, those alleged restraints clearly do notfall within the
per se
rule requirements.The rule of reason analysis, including the "quick look" analysis to which Plaintiff aspires, employs aburden-shifting framework, wherein Plaintiff must firstestablish that the restraint
[*15]
produces a significantanticompetitive effect within the relevant geographic andproduct markets. Id. In addition, under either approach, aprivate antitrust plaintiff, in addition to having to showinjury-in-fact and proximate cause, must allege andeventually prove "antitrust injury."
Bassett at 434
.Plaintiff has not demonstrated that it suffered an antitrustinjury.Even if Plaintiff allegedly has shown injury to
itself,
it has not shown injury to a relevant market as requiredby the antitrust laws. The purpose of the Sherman Act isto rectify the injury to
consumers
caused by diminishedcompetition.
Bassett at 434
. Thus, Plaintiff must allegenot only an injury to itself, but an injury to the market aswell. Id. The purpose of the antitrust laws is theprotection of
competition,
not
competitors. LeeginCreative Leather Products, Inc. v. PSKS, Inc., 551 U.S.877, 127 S.Ct. 2705, 2724, 168 L. Ed. 2d 623 (2007)
.Under either market alleged by Plaintiff
9
-- highschool education in Tennessee or the regulation of interscholastic athletics at the high school level inTennessee -- Plaintiff has not carried its burden of showing that the three challenged restraints have anegative effect on
economic
(rather than athletic)
[*16]
competition. For example, Plaintiff has not proven thatthe Division I/Division II split, the Recruiting Rule, orthe sanctions imposed upon Brentwood Academy haveincreased the costs of membership in the TSSAA,negatively affected the gate receipts for high schoolfootball games, or increased the costs of high schooleducation, particularly where the majority of TSSAAmembers are free public schools.9 The Court assumes, for purposes of thisMotion, the geographic and product marketsproposed by the Plaintiff.Plaintiff has not shown that Defendant's Bylawswere enacted for the purpose of affecting any price ininterstate commerce and has not shown evidence of injury to
economic
competition. The harm Plaintiff alleges is not the sort of economic harm which theantitrust laws were intended to prevent.Therefore, even if Plaintiff had shown that the factsof this case involved a restraint on trade or commerce,which it has not, Plaintiff has not shown another requisitefor relief, antitrust injury. For all these reasons, Plaintiff'sRenewed Motion for Summary Judgment on its SectionOne claims is DENIED, and Defendant's Motion forSummary Judgment (Docket No. 354) on the Section Oneclaims
[*17]
is GRANTED.Section Two of the Sherman Act provides that it isillegal for any person to monopolize, or attempt tomonopolize, or combine or conspire with any otherperson or persons to monopolize, any part of the trade orcommerce among the several States.
15 U.S.C. § 2
.

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