Key Anthony Kennedy Supreme Court Sports Law Decisions

By Cameron Miller (Stanford University ’16) Guest Contributor

After over 40 years of service  on the federal judiciary – including 30 on the Supreme Court – Justice Anthony Kennedy plans to retire at the end of July 2018. During his tenure on the high court, Kennedy authored numerous influential opinions on issues including gay rights, civil rights, campaign finance laws, and abortion regulations. Justice Kennedy also had the opportunity to rule on a handful of sports law cases that came before the Court, which will be discussed here.

Tarkanian v. NCAA (1988)

Less than a year into his SCOTUS tenure, Justice Kennedy sided with the National Collegiate Athletic Association (NCAA) in what is regarded as one of the most critical decisions in college sports jurisprudence. In Tarkanian, the Court considered a ruling from the Nevada Supreme Court, which in 1987 found the NCAA had violated the due process rights of University of Nevada-Las Vegas (UNLV) men’s basketball coach Jerry Tarkanian. Tarkanian alleged the NCAA acted improperly when it implicated him in a variety of NCAA rules violations, for which he was later suspended (in a subsequent lawsuit, Tarkanian claimed, among other things, that the NCAA’s lead investigator impersonated a reporter to a key witness and recorded the conversation, then threatened an athlete with ineligibility if he did not testify against Tarkanian). A Nevada state court agreed, and the state’s supreme court held on appeal that UNLV’s grant of authority to the NCAA over the infractions process meant the NCAA was, by extension, a state actor. State actors, unlike private persons or organizations, are required to observe closely the rights, freedoms, and protections outlined in the Bill of Rights (e.g., due process). The NCAA took the case to the Supreme Court, where Justice Kennedy joined a 5-member majority that reversed the Nevada courts’ rulings. Writing for the majority, Justice John Paul Stevens posited that because UNLV was not totally beholden to the NCAA’s rules—the school could have withdrawn from the organization at any time—the NCAA was not a state actor. Likewise, the Court concluded, the state of Nevada did not delegate authority in a cooperative manner with the NCAA, as UNLV and NCAA officials were at odds throughout the Tarkanian matter and the NCAA “enjoyed no governmental powers to facilitate its investigation.”

The significance of Tarkanian cannot be understated: with the NCAA retaining its status as a non-state actor, it was (and remains) free to conduct its disciplinary investigations and hearings however its members agreed, “no matter how unfair [those procedures] may be.” For example, the NCAA’s Committee on Infractions does not expressly allow cross-examination of witnesses (a hallmark of due process). Also, the NCAA’s Restitution Rule provides for the annulment of individual and/or team records for athletes who participate in contests pursuant to a judicial stay or injunction that is later deemed not justified. Such a rule might discourage athletes and coaches from seeking redress through the legal system—which runs contrary to good public policy and may raise due process concerns.

Vernonia School District 47J v. Acton (1995)

In Vernonia, Kennedy was amongst a 6-member majority that upheld the constitutionality of athlete drug testing in an Oregon high school district. The case was appealed from the Ninth Circuit, which found the district’s random, suspicionless drug testing of athletes—and athletes only— violated the Fourth Amendment and the Oregon constitution (the district’s athletes were subject to drug testing even if there was no reason to suspect use of illicit substances). The appellate court reaffirmed a seminal Supreme Court holding that “students [do not] shed their constitutional rights…at the schoolhouse gate,” writing that athletes enjoy the same right and expectation of privacy as other students did, including “privacy in their excretory functions[.]” The Ninth Circuit panel also determined that the issues stemming from the drug use in the school district did not create “extreme dangers and hazards,” and therefore did not outweigh the privacy concerns of the invasive testing

Kennedy and the high court reversed the judgement of the Ninth Circuit. The Court, which split 6-3, concluded that the physically revealing nature of sports participation and the additional regulations (e.g., pre-participation physicals) athletes voluntarily subjected themselves to dampened their privacy expectations. And the manner in which the Oregon district gathered the urine samples—the males remained fully clothed and urinated away from the monitor, while females urinated out of sight of the monitor in a stall—raised “negligible” privacy concerns, according to the majority. The Justices also credited lower court’s findings on the seriousness of the drug problem in the Oregon school district and the particular risk of drug use amongst athletes highlighting the dangerous intersection of physical exertion and drug use and the “‘role model’ effect of athletes’ drug use[.]” Cases involving student and employee rights have relied on Vernonia, which has become an important contour of privacy and Fourth Amendment protections in academic settings.

Brown v. Pro Football, Inc. (1996)

The issue in Brown was the extent of the “nonstatutory labor exemption,” which generally shields from antitrust scrutiny restraints on trade arising from collective bargaining agreements. Sparking the dispute was a proposal by the NFL to allow teams to employ players on a “developmental squad”; these players, according to the NFL’s proposal, would be paid $1,000 per week. After negotiations regarding compensation and general working conditions of the “developmental squad” players with the NFL players’ union broke down, the league “unilaterally implemented the developmental squad program by distributing to the clubs a uniform contract that embodied…the $1,000 proposed weekly salary.” The 8-member Brown majority, which Kennedy joined, broadly interpreted the exemption, holding that even agreements amongst employers to unilaterally institute a wage ceiling after an impasse in negotiations were not subject to antitrust challenge. Writing for the majority, Justice Stephen Breyer expressed his concern that failing to extend the labor exemption in such situations would tie the hands of employers and ultimately frustrate the policy goals of the nation’s labor laws. Consequently, the Court explained, the judiciary would have to “answer a host of important practical questions about how collective bargaining over wages, hours, and working conditions is to proceed—the very result that the [nonstatutory] labor exemption seeks to avoid.”

NCAA v. Smith (1999)

Justice Kennedy was amongst a unanimous Smith Court that clarified the scope of Title IX in intercollegiate athletics. A female volleyball player alleged the NCAA contravened Title IX by allegedly providing males more waivers to a rule prohibiting athletes from competing at schools other than their undergraduate degree-granting institution. The Third Circuit ruled in the player’s favor, reasoning that the NCAA was subject to Title IX because it collected dues from its member schools, who were the recipients of federal education funds. Kennedy and the Court reversed, holding that only “[e]ntities that receive federal assistance, whether directly or through an intermediary, [fall within the scope] of Title IX.” Because the NCAA was not a “recipient” of federal education dollars under that definition, it was therefore not bound to Title IX’s anti-discrimination provisions. Like Tarkanian before it, Smith was just the latest in a large corpus of jurisprudence finding the NCAA not subject to various laws and principles of justice.

PGA Tour, Inc. v. Martin (2001)

Martin saw Justice Kennedy break with the Court’s staunch conservatives—Justices Scalia and Thomas—and join a seven-member coalition applying the Americans with Disabilities Act (ADA) to the Professional Golfers’ Association (PGA) Tour. The case involved golfer Casey Martin, who had a severe cardiopulmonary abnormality that ultimately lead to atrophy in his right leg and an inability to walk a golf course. Martin was routinely permitted to use a golf cart during tournament play in college and the opening phases of the PGA’s qualifying school (Q-school), which features tournaments players must “pass” in order to earn a spot on the PGA Tour. But in his third Q-school phase, he was denied the cart accommodation and later sued. Martin prevailed in the trial and appellate courts, with both holding the ADA applied to PGA Tour events and that Martin’s use of a cart did not “fundamentally alter the nature” of the golf tournaments. But the day after the Ninth Circuit published its opinion in favor of Martin, another federal appellate court issued a contrary ruling in a similar matter. To resolve the circuit split, the Supreme Court reviewed Martin’s case, ultimately siding with the golfer.

The majority addresses two issues: whether the PGA Tour’s Q-school events are within the scope of the ADA and whether allowing Martin to use a cart during play would “fundamentally alter the nature” of the Tour’s events. Writing for the seven, Justice Stevens explained that because the PGA was offering the “privilege” of participating in a golf competition, it could not shirk ADA obligations. The Court also found that because “the walking rule is not an indispensable feature of tournament golf,” the PGA’s contention that allowing Martin to use a cart would change the game itself could not be countenanced. Those seeking protection under the ADA, including in sporting events, have cited Martin extensively.

Brentwood Academy v. Tennessee Secondary School Athletic Association (2001) (Brentwood I) and Brentwood Academy v. Tennessee Secondary School Athletic Association (2007) (Brentwood II)

The Brentwood cases involved further questions on the state actor status of scholastic athletic associations. Brentwood I centered on a challenge to the Tennessee Secondary School Athletic Association’s (TSSAA) regulations of athlete recruiting; namely, its proscription of “‘undue influence’ in recruiting athletes[.]” A member school (Brentwood Academy) sanctioned for allegedly violating that rule sued the TSSAA, claiming it was a state actor and that its recruitment rule was unconstitutional. The liberal wing of the court picked up the vote of Justice Sandra Day O’Connor and found in favor of Brentwood, determining that the “pervasive entwinement of state school officials in the structure of the [TSSAA]” transformed the nominally private athletic association into a state actor. The five-justice majority concluded that since more than 8 in 10 TSSAA schools were public and because officials at those public schools “do not merely control but overwhelmingly perform all but the purely ministerial acts by which the [TSSAA] exists and functions,” the organization was a state actor. Justice Kennedy, along with Justices Thomas, Scalia, and Rehnquist, dissented, objecting primarily to the majority’s use of the “entwinement” test to determine state action. “Entwinement” as an analytical framework was not expressly endorsed in the law cited by the majority, the dissent argues. Further, the TSSAA did not rely heavily on membership dues from its public school members for its operations, nor was the organization created by the state government “for the purpose of fulfilling a government objective[.]”

Six years after its first ruling on the TSSAA’s recruiting regulations, the issue again came before the Supreme Court. This time, however, whether the anti-recruitment rule violated the First Amendment’s freedom of speech guarantee was the central question. The Court’s decision was unanimous, with Justice Kennedy writing a concurring opinion. Likening the TSSAA’s ban on recruiting to rules governing solicitation by lawyers, the Court determined the recruiting Brentwood engaged in had the potential to mislead young athletes; limitations on this narrow section of speech, the Court reasoned, did not raise cognizable Constitutional concerns. The TSSAA’s anti-recruiting rule was also interpreted to further an important government interest by regulating speech that might otherwise “lead to exploitation, distort competition between high school teams, and foster an environment in which athletics are prized more highly than academics.” In his separate opinion, Justice Kennedy endorses the majority’s holding but rejects its reliance on the case regarding solicitation by lawyers (Ohralik). The majority, Kennedy wrote, stretches its holding far beyond its appropriate use. By leaning on Ohralik, the Court appears to suggest that the Brentwood recruitment speech would not be protected even if the school were not subject to TSSAA rules—a conclusion Kennedy implicitly rejects.

American Needle, Inc. v. National Football League (2010)

Justice Kennedy counted himself amongst a unanimous Supreme Court that made a key antitrust ruling in American Needle. There, the Court ruled that the NFL’s 32 teams were distinct economic actors whose conduct could give rise to unlawful cooperation under the Sherman Act. The case was brought by American Needle, an apparel manufacturer that had for years produced official, NFL-licensed products. That relationship ended in 2000 when, through its NFL Properties licensing unit, the NFL awarded Reebok “an exclusive 10-year license to manufacture and sell trademarked headwear for all 32 teams.” American Needle sued, alleging the teams had illegally colluded and made a concerted effort not to deal with other apparel companies. The trial and appellate courts found in favor of the NFL, determining that the league’s teams had “so integrated their operations that they should be deemed a single entity” for the purpose of antitrust analysis.

The Supreme Court reversed, ruling that because NFL Properties’ decisions on licensing matters “are made by the 32 potential competitors”—each of whom could, if they so chose, independently license their intellectual property—the teams were engaging in “concerted action.” In other words, even though the teams (who would otherwise compete in the licensing marketplace) had collectively agreed to pool and delegate their licensing rights to another entity, the fact that those teams were economic competitors and exercised influence over the licensing process meant they were not acting jointly.

Murphy v. National Collegiate Athletic Association, et al. (2018)

One of Kennedy’s final rulings on the SCOTUS bench was perhaps the most influential sports law decision of his lengthy judicial service. In Murphy, Kennedy was part of a seven-justice majority that invalidated the Professional and Amateur Sports Protection Act, which since 1992 had banned state-run sports gambling (certain states, like Nevada, were exempted from the law). Voters in New Jersey, however, authorized the state legislature in 2011 to amend the state’s constitution to allow for sports gaming. Various sports leagues, including the NCAA, sued to block the expansion of gambling. But after prevailing at nearly every lower court, the NCAA and professional leagues saw the conservative wing of the Supreme Court, plus two liberals, find PASPA unconstitutional. The law violated the Constitution’s anti-commandeering principle, the majority said, because it “unequivocally dictates what a state legislature may and may not do.” That contravenes the Tenth Amendment’s guarantee that “all legislative power not conferred on Congress by the Constitution is reserved for the States.”

This decision could spur a monumental shift in the law and business of the sports industry by freeing states to decide whether to permit sports gambling within their jurisdictions. Assuming sports gambling increases in the coming years, leagues and teams could be faced with both an untapped revenue stream and fertile ground for risks to competition integrity.

Justice Kennedy’s sports law rulings are somewhat emblematic of his overall tenure on the Supreme Court: consistently conservative (e.g., limiting scope of state action in Tarkanian and Brentwood I), but with occasional swings to the left (e.g., clarifying application of ADA (Martin) and Sherman Act (American Needle)). While these are not the most significant cases of Kennedy’s career by any stretch, most have (or will) reverberate throughout the sports industry.

 

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