Ending Court Fight, NCAA Buys NIT

Association pays $56.5 million to take control of competing tourneys and settle antitrust challenge.
August 18, 2005

The National Collegiate Athletic Association has agreed to pay the five colleges that sponsor the National Invitation Tournament $56.5 million for the rights to operate the preseason and postseason NIT and to end the NIT sponsors' 2001 antitrust lawsuit against the NCAA.

Under the agreement, which was announced Wednesday by the NCAA and the Metropolitan Intercollegiate Basketball Association at a Madison Square Garden news conference, the NCAA will pay the funds over 10 years to the five MIBA members: Fordham University, Manhattan College, New York University, St. John’s University, and Wagner College.

In exchange, the NCAA will manage the NIT's two annual tournaments, committing to keep them in New York for at least five years and throwing its significant marketing and other weight behind the tournaments. Many details of the agreement remained to be worked out.

In announcing the agreement, Myles Brand, the NCAA's president, and John Sexton, president of NYU, portrayed the arrangement as a logical partnership between the entities, rather than as the resolution of what had been an often bitter legal battle in which the metropolitan association accused the NCAA of trying to crush the NIT through anticompetitive rules and other practices.

"We've unified postseason basketball," said Brand. He added that while the agreement had appeared to come out of the blue, two weeks into the trial, the parties had been talking with a mediator for months to reach what he called a "very significant agreement."

"On behalf of the five universities that comprise MIBA, I'm delighted that we've come to this point," said Sexton, adding that the "time has come to move the [NIT] to a new level" with the "assets of the NCAA behind it." He and Brand repeatedly rebuffed questions aimed at gauging whether the NCAA or the NIT had emerged more successfully from the lawsuit and the agreement that ended it.

Was the NCAA vulnerable in the lawsuit, one reporter asked Sexton, former dean of NYU's law school?

"Trials are dispute resolution mechanisms, and they are best done without thinking of wounds and vulnerabilities," he said.

In response to another reporter's suggestion that after arguing that the NCAA was trying to kill the NIT, it "seems kind of ironic" that the latter's sponsors had accepted an agreement in which the NCAA, "instead of killing it ... has just bought it," Sexton demurred. "I'm very allergic to being judgmental," he said.

Paul Haagen, a law professor and director of Duke University's Center for Law and Sports Policy, said he was not surprised that the parties settled, especially given the "potential for serious risk" confronting the NCAA. "If you can, consistent with your principles, this is the sort of case that ought to settle," he said. 

While the association faced a potentially large financial price tag if it lost the antitrust suit, he said, it faced an even more significant risk in the "enormous disruption" that could have unfolded at a time that the NCAA is pushing major academic reforms and other political changes. "To lose this really could have been to endanger the entire viability of the organization."

As for the metropolitan basketball association, which pushed its lawsuit to "keep New York as a center of college basketball and a showcase for the schools in that group," they have ensured that the tournament will remain in New York for at least five years, and will gain the NCAA's marketing and other might. 

But after fighting in the lawsuit to regain its ability to operate as a viable, independent competitor to the NCAA, he added, "you can certainly make the argument that they've agreed to go away."


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