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NCAA Rips $45M Fee Request in Student Athlete Pay Suit

May 24, 2019 | Posted in : Billing Record / Entries, Challenging Fees, Expenses / Costs, Fee Dispute, Fee Request, Hourly Rates / Hourly Billing, Lodestar / Multiplier

A recent Law 360 story by Dave Simpson, “NCAA Rips $45M Atty Fee Bid in Student Athlete Pay Suit,” reports that the $45 million attorney fee bid from the legal team whose March victory barred the NCAA from restricting student athletes' education-related compensation is unreasonable because it seeks pay for "excessive, redundant, and unnecessary" hours worked, the NCAA said in California federal court.  The NCAA and several of its conferences said that rather than multiplying the requested $30 million attorney fee lodestar by 1.5, as proposed by the student players, it should be reduced by 10% to exclude non-compensable hours from the fee application, and then hit it with a negative multiplier to reflect the fact that the attorneys only scored a partial victory for their clients.

"The district court rejected much of plaintiffs' demands, retaining the cost-of-attendance cap on financial aid and permitting defendants to limit the levels of non-education-based compensation that Division I schools may offer their student-athletes," the organizations said.  The bid for attorney fees stems from the key injunction the student athletes won in March.

U.S. District Judge Claudia Wilken rejected the NCAA's arguments that its compensation rules promote demand for college sports and justify its antitrust violations.  She prohibited the association from enforcing rules that she considered "overly and unnecessarily restrictive."

Following that major win, the players' attorneys sought a compensation package of $29.9 million plus the multiplier for what they said was the economic value of the injunction, and submitted an economist's declaration to bolster their argument.  But the NCAA says that the proposal is off-base, starting with the calculation for hours worked by the attorneys.

"Their refusal to provide detailed billing records, submitting instead evidence only of the total number of hours spent by various attorneys by year — or in one instance across all years of the litigation — without identifying the subject matter of any individual's time expenditures has made it impossible for defendants or the court to evaluate whether the time spent on particular tasks was reasonable," the NCAA said.  Likewise, the requested 1.5 multiplier is meritless, the NCAA said, because the players' attorneys don't argue that the lodestar is unreasonably low, nor do they show that they took on unreasonable risks or won an exceptional victory.

The organizations also claim that the $1.3 million sought in costs is "unsupported, inappropriate and unreasonable," saying that almost $1 million of it is not supported "with even a single invoice or document."  Instead, the NCAA claims, the players' attorneys are "simply listing vague categories of purported costs for which they claim reimbursement."  As for the remaining costs, which the NCAA says are accounted for through invoices, much of it is not compensable as a matter of law, the motion claims.

The NCAA says that among these costs are bills for expenses that have already been covered, bills for video services on days when no video services were used, and more than $200,000 in unspecified color copy printing costs, which the NCAA says should be reduced by at least 50% because they are excessive.  "I think the time has come to see what defendants spent to put this in perspective," Steve W. Berman, who is representing the students, said in an email to Law360.  "I have a bet in the litigation team pool that they are twice what we spent!"

The March ruling followed a landmark 10-day bench trial that kicked off in Oakland, California, on Sept. 4 over allegations by Division I college football and basketball players that the NCAA's rules illegally restrict what they can receive to play.  For years, the rules limited athlete benefits to cost-of-attendance scholarships; student assistance funds, which cover certain school-related expenses; some need-based grants, like Pell Grants; and bowl participation awards, which are typically capped around $450.

During the trial, sports economists, former athletes, university officials and NCAA administrators took turns testifying on the impacts of the NCAA's compensation rules.  Three former athletes who didn't play professionally after college recalled how they struggled as students to pay for meals, clothes and trips home, while they spent between 40 to 60 hours a week on their sports, leaving little time for academics.

The case is In re: National Collegiate Athletic Association Athletic Grant-In-Aid Cap Antitrust Litigation, case number 4:14-md-02541, in the U.S. District Court for the Northern District of California.