R.M. Smith vs. NCAA (Third Circuit)

EDUC 432

Tom Hauser and Jason Wancowicz

April 23, 1999

R. A. Smith vs. NCAA

United States Court of Appeals for the Third District

Nos. 97-3346 and 97-3347

[March 16, 1998]

R. M. Smith vs. NCAA deals with eligibility of a student-athlete. Renee Smith, a graduate St. Bonaventure University, had been a former volleyball player for two years while enrolled at the university. After her second year of competition, Smith quit the team and eventually graduated a year and a half early. She then enrolled in postbaccalarueate programs at both Hofstra University and the University of Pittsburgh.

Smith attempted to continue her volleyball career at both institutions, but the NCAA, an association of public and private institutions that issues rules and regulations for athletic competition, denied her this opportunity. The NCAA said that because she was attempting to play at an institution other than where she received her degree, she could not continue her playing career. The NCAA based this decision on its Postbaccalaureate Bylaw. Both Hofstra and Pittsburgh applied for her eligibility to be reinstated but the NCAA denied both requests.

Smith then sued the NCAA. Her main disagreement concerned the bylaw that the NCAA had previously instituted, as well as with the NCAA refused to waive the bylaw for her. Smith claimed that the NCAA violated of Section I of the Sherman Act when it did not permit her to play. She said that was an unreasonable restraint of trade. She claimed also that the NCAA violated Title IX, which states that institutions cannot discriminate on the basis of sex. The court dismissed her claims based on the fact that the refusal to waive the bylaw was not in violation of the Sherman Act. The court then stated that the NCAA was a recipient of federal funds, and therefore, Title IX was applicable.

Basically Smith said that the Postbaccalaureate Bylaw restrained her ability to perform a trade, in this case, volleyball. The court stated that waiving the bylaw and allowing the student to participate is not the type of action for which the Sherman Act was intended. The act states: "every contract, combination in form of trust or otherwise, or conspiracy, in restraint of trade or commerce among several states, or within foreign nations, is declared to be illegal." Basically, this says that every contract is prohibited, but does not prohibit all restraints of trade. The only trades that are considered illegal are unreasonable ones. The court stated that antitrust laws are limited solely to commercial and business endeavors. The court then said that eligibility rules are not commercial practices; therefore they cannot be related to the Sherman Act. The court then declared the Act not relevant to the case, and dismissed this claim.

Title IX states that "no person in the United States shall, on the basis of sex, be excluded from participating in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving Federal financial assistance." Intercollegiate athletics is an educational program or activity within the statute. Federal regulations define "recipient" as including, "any public or private agency, institution or organization, or other entity, or any other person, to whom Federal financial assistance is extended directly or through another recipient and which operates an educational program or activity which receives or benefits from such assistance, including any subunit, successor, assignee, or transferee thereof."

The district court dismissed Smith's original Title IX complaint because her original complaint did not contain an allegation that the NCAA received federal financial assistance. Smith failed to prove to the district court that the NCAA, by receiving dues from its members, was subject to the requirements of Title IX. The Court of Appeals for the Third Circuit agreed with the dismissal of her original Title IX complaint and agreed that Smith's original complaint did not contain an allegation that the NCAA received federal financial assistance, and thus would have to follow the regulations of Title IX. However, the court of appeals sent the case back to the district court because the district court erred in denying Smith's motion for leave to amend.

Smith's proposed amended complaint, if proven, would establish that the NCAA was a recipient of federal funds within the meaning of Title IX. Her amended complaint stated, "that the NCAA is a recipient of federal funds because it is an entity which receives federal assistance through another recipient and operates an educational program or activity which receives or benefits from such assistance." The court of appeals stated that this allegation would be sufficient to bring the NCAA within the scope of Title IX.

The court of appeals affirmed the district court's dismissal of Smith's Sherman Act claim. The court of appeals also reversed the district court's denial of the motion to amend and remanded to the district court for further proceedings, allowing Smith to prove that the NCAA was subject to Title IX regulation.