The Seventh Circuit has rejected antitrust claims filed against the NCAA by former Northern Illinois University student-athlete Peter Deppe and upheld the NCAA’s rule delaying the athletic eligibility of student-athletes who transfer to alternate schools without serving a “year in residence” at their new school before becoming eligible to resume their collegiate career.

The Circuit Court’s decision supporting the NCAA’s year in residence requirement follows the recent NCAA Division I counsel’s voluntary modification of the transfer process. The rule change eliminated the NCAA’s long-standing “Permission to Contact” process for Division I athletes in favor of a simple notification standard allowing student-athletes to initiate the transfer process by simply providing written notification of the desire to transfer to his or her institution.

Deppe, a former punter for the Northern Illinois football team, claimed that he had been promised an athletic scholarship following his success of the field. Unfortunately, the special team’s coach who allegedly made the scholarship promise to him left the school and the head coach refused to honor the commitment that was made to him.

Following the refusal of the head coach to honor his assistant’s commitment to Deppe, Deppe was offered the opportunity to play for the University of Iowa but subsequently learned that an NCAA Bylaw would prohibit him from playing during his first year at the school. The University of Iowa informed Deppe that as a result of his inability to be able to play for the team immediately that they would be forced to pursue a different punter for the squad for the upcoming season.

Deppe initially challenged the NCAA Bylaw restricting his ability to play immediately upon his transfer by filing a proposed class action suit against the NCAA in March of 2016 alleging that the NCAA rule was anti-competitive in violation of federal anti-trust laws. U.S. District Judge Tanya Walton Pratt dismissed Deppe’s action on the basis that the NCAA bylaw furthers its mandate to promote competition among amateur college sports programs. Deppe appealed Judge Walton’s decision to the Seventh Circuit arguing that the lower court decision gave the NCAA “carte blanche” to violate anti-trust laws.

In response to Deppe, the NCAA argued to the Circuit Court that its bylaw promotes a pro-competitive environment by maintaining the proper balance between academics and athletics.

The NCAA successfully argued that the potential movement of student-athletes by changing schools during each year of their eligibility would “completely divorce the athletic and academic experience for NCAA student-athletes.

So while the ease to move forward with a potential transfer has been put in place by the NCAA,

the Seventh Circuit has reinforced the NCAA mandate that their rule requiring student-athletes to spend one year in residence at their new school remains in full force and effect pending other anticipated court challenges to the rule.

For more information about the proposal, and institutional obligations and best practice related to implementation of the notice of transfer system, please contact Gregg Clifton or John G. Long at Jackson Lewis P.C.