Bassett v. National Collegiate Athletic Ass'n

• Citation: 528 F.3d 426
• Decision Date: 09 June 2008
• Docket Number: No. 06-5795.,06-5795.
• Parties: Claude L. BASSETT, Plaintiff-Appellant, v. The NATIONAL COLLEGIATE ATHLETIC ASSOCIATION and University of Kentucky Athletic Association, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)

528 F.3d 426

Claude L. BASSETT, Plaintiff-Appellant, v. The NATIONAL COLLEGIATE ATHLETIC ASSOCIATION and University of Kentucky Athletic Association, Defendants-Appellees.

No. 06-5795.

United States Court of Appeals, Sixth Circuit.

Submitted: March 13, 2008.

Decided and Filed: June 9, 2008.

ON BRIEF: Robert R. Furnier, Furnier & Simmonds, Cincinnati, Ohio, for Appellant. Edward H. Stopher, Scott A. Davidson, Boehl, Stopher & Graves, Louisville, Kentucky, Kevin G. Henry, Stephen L. Barker, Sturgill, Turner, Barker & Moloney, Lexington, Kentucky, for Appellees.

Before: CLAY and McKEAGUE, Circuit Judges; BOYKO, District Judge.^*

OPINION

BOYKO, District Judge.

Appellant Claude L. Bassett ("Bassett") was an assistant football coach for the University of Kentucky ("UK") from 1997-2000 when he resigned due to allegations of The National Collegiate Athletics Association ("NCAA") rules infractions. Bassett filed suit against NCAA, the Southeastern Conference ("SEC") and the University of Kentucky Athletic Association ("UKAA"), alleging conspiracy to violate antitrust laws, fraud, civil conspiracy and tortious interference with contract. The district court granted NCAA's, the UKAA's and the SEC's motions to dismiss the antitrust and civil conspiracy claims and granted NCAA's and the SEC's motions to dismiss Plaintiff's fraud claims. Later, the district court granted summary judgment for NCAA and the UKAA on Plaintiff's remaining claims. Bassett now appeals the district court's granting of NCAA's motion to dismiss the antitrust claim and the district court's granting of summary judgment on the UKAA's fraud and alleged breach of contract claims.

The Appellant's appeal is not well taken. We find the district court correctly determined Appellant's antitrust claim was not commercial in nature and failed to allege an antitrust injury. Furthermore, Appellant failed to demonstrate reasonable reliance and causation on his fraud claim and Appellant failed to plead a breach of contract claim and, even if he did, such contract would be void ab initio as against public policy.

I.

Appellant Claude L. Bassett was an assistant football coach for the University of Kentucky ("UK") from 1997-2000 when he resigned due to allegations of NCAA rules infractions. Bassett coached at Brigham Young University for twelve years prior to joining the UK football program and thereafter, Bassett was hired by the UK head football coach, Hal Mumme, as recruiting coordinator and assistant coach. Bassett's employment contract was with the UKAA, which serves as the athletic department for the UK. On November 19, 2000, Larry Ivy, the UK's athletic director, called Bassett and Mumme to a meeting, wherein Ivy confronted Bassett about alleged rules violations. In the course of the meeting, Ivy asked Bassett to resign in light of the allegations of impropriety. In exchange for Bassett's resignation, Ivy assured Bassett no further actions would be taken against him. As a result of the November 19, 2000 meeting Bassett resigned. The following day, the UK disclosed that Bassett, along with several other assistants, had been fired. The UK conducted an internal investigation of its football program to determine if any NCAA rules violations occurred. The investigation proceeded with assistance from the SEC Commissioner and lasted through February 2001. On February 28, 2001, the UK turned over the results of its internal investigation to NCAA. As a result, NCAA issued official inquiry letters to Bassett, regarding alleged infractions, who responded in writing through his counsel. Bassett declined to appear at the hearing before NCAA, to address allegations which included, improper recruiting inducements provided to prospective student athletes and high school coaches and academic fraud in aiding enrolled student athletes by preparing their papers or having student assistants type papers for enrolled student athletes. Shortly thereafter, NCAA imposed sanctions against the UK for violations of NCAA rules. In addition to the sanctions against the UK, NCAA issued a show cause order requiring Bassett and any NCAA member institution seeking to hire him in an athletically related position, from January 21, 2002 through January 30, 2010, to appear before NCAA Division I Committee on Infractions to "consider whether the member institution should be subject to the show cause procedures of Bylaw 19.6.2.2-(1), which could limit the coach's athletically related duties at the new institution for a designated period." On September 17, 2004, Bassett filed his Complaint against the SEC, NCAA and the UKAA.

II.

On appeal, Bassett claims the district court erred in granting Appellee NCAA's motion to dismiss Bassett's antitrust claim on the basis of its finding that NCAA's enforcement of its rules did not affect commerce and Bassett had failed to state an antitrust injury. Bassett further contends the district court erred in granting the UKAA's summary judgment motion on Bassett's fraud and breach of contract claims when it found Bassett failed to demonstrate causation and reasonable reliance.

Standard of Review

We have jurisdiction to review the final decision of a district court under 28 U.S.C. § 1291. A district court's dismissal of a case, pursuant to Fed.R.Civ.P. 12(b)(6), is a question of law subject to de novo review. Kottmyer v. Maas, 436 F.3d 684, 688 (6th Cir.2006). "The Supreme Court has recently clarified the pleading standard necessary to survive a Rule 12(b)(6) motion." CGH Transport Inc. v. Quebecor, World, Inc., 261 Fed.Appx. 817, 819-20 (6th Cir.2008) citing Bell Atl. Corp. v. Twombly, ___ U.S. ___, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Factual allegations contained in a complaint must "raise a right to relief above the speculative level." Id. at 1965. Twombly does not "require heightened fact pleading of specifics, but only enough facts to state a claim to relief that is plausible on its face." Id. at 1974. "In reviewing a motion to dismiss, we construe the complaint in the light most favorable to the plaintiff, accept its allegations as true, and draw all reasonable inferences in favor of the plaintiff." Directv, Inc. v. Treesh, 487 F.3d 471, 476 (6th Cir.2007). When a court is presented with a Rule 12(b)(6) motion, it may consider the Complaint and any exhibits attached thereto, public records, items appearing in the record of the case and exhibits attached to defendant's motion to dismiss so long as they are referred to in the Complaint and are central to the claims contained therein. See Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir.2001).

We review orders granting summary judgment and/or partial summary judgment de novo. Ciminillo v. Streicher, 434 F.3d 461, 464 (6th Cir.2006), Ability Ctr. v. City of Sandusky, 385 F.3d 901, 903 (6th Cir.2004). "In conducting that review, we must assume the truth of the non-moving party's evidence and construe all inferences from that evidence in the light most favorable to the non-moving party." Ciminillo at 464. "A genuine issue of material fact exists when there is sufficient evidence for a trier of fact to find for the non-moving party." Id.

III. Bassett's Antitrust Claim Against NCAA

Bassett's Complaint alleges NCAA, the UKAA and the SEC conspired to prevent Appellant from coaching at any NCAA member school in violation of the Sherman Antitrust Act, 15 U.S.C. §§ 1-2 (2000) and the Clayton Act, 15 U.S.C. § 15 (2000), as the conspiracy amounts to a group boycott. The district court determined Bassett's antitrust allegation failed to state a claim because NCAA's actions were not commercial in nature and therefore, did not violate the Sherman Act. The district court held "enforcement of the rules at issue here is not within the purview of antitrust law as it is not related to the NCAA's commercial or business activities." (JA 88). Citing Smith v. NCAA, 139 F.3d 180, 186 (3d Cir.1998), the district court held, "[r]ather than intending to provide the NCAA or any of its member schools with a commercial advantage, enforcement of rules governing recruiting, improper inducements, and academic fraud `primarily seek[s] to ensure fair competition in intercollegiate athletics.'" (JA 88).

Even if they were commercial in nature, the district court reasoned, Bassett had still failed to state a claim because he failed to plead an antitrust injury. The district court relied on Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489, 97 S.Ct. 690, 50 L.Ed.2d 701 (1977), which defined antitrust injury as (1) "injury of the type the antitrust laws were intended to prevent" and (2) injury "that flows from that which makes defendants' acts unlawful." The district court went on to say, "because the purpose of the antitrust laws is to protect competition rather than competitors, a plaintiff must allege injury, not only to himself, but to a relevant market. Thus, failure to allege an anti-competitive impact on a relevant market amounts to a failure to allege an antitrust injury." (JA 88) (citing Banks v. National Collegiate Athletic Ass'n, 977 F.2d 1081, 1087 (7th Cir.1992), Brown Shoe Co. v. United States, 370 U.S. 294, 320, 82 S.Ct. 1502, 8 L.Ed.2d 510 (1962)). The district court determined Bassett's Complaint "failed to allege any anticompetitive effect on an identifiable market, failed to allege any decrease in the supply or quality of coaching services, increase in cost of coaching services, or any harm to consumers resulting from his punishment." (JA 89). The district court concluded, "Bassett's conclusory allegations of an antitrust injury-unsupported by any factual allegations that resemble a cognizable antitrust claim-are insufficient." (JA 89).

On appeal, Bassett contends "the trial court misunderstood the trade practice at issue." While Bassett claims the district court incorrectly presumed Bassett was attacking NCAA's standards for defining improper conduct, Bassett argues he was challenging NCAA's...