Justice Department investigating BCS over antitrust issues

WASHINGTON — The Department of Justice today notified the NCAA that it has opened a formal antitrust inquiry into the Bowl Championship Series, used to determine who’ll play in the national championship and other major college football bowl games.

The move follows a request from the attorney general of Utah for the DOJ to take up the matter, following two seasons where the Utah Utes football team has gone undefeated but been snubbed by the BCS. After the 2008 football season, Utah was the only undefeated team in the nation, but one-loss Florida and Oklahoma met for the national championship instead. The Utes were sidelined to the Sugar Bowl, where they handily swept past Alabama, 31-17.

“Serious questions continue to arise suggesting that the current Bowl Championship Series (DCS) system may not be conducted consistent with the competition principles expressed in the federal antitrust law,” Assistant Attorney General Christine Varney wrote in a letter dated May 3. The letter continued on with follow-up questions to guide the investigation, including the very blunt “Why does the Football Bowl Subdivision not have a playoff, when so many other NCAA sports have NCAA-run playoffs or championships?”

The full letter can be read here.

NCAA football championships among smaller schools are decided by playoffs, such as the Division III title recently won by the University of Minnesota-Duluth, as are championships for every other NCAA-sanctioned sport, like men’s ice hockey, which was also won this year by Minnesota-Duluth.

President Obama has said repeatedly that he’s a proponent of a playoff in college football. His proposed system is an eight-team, win-or-go-home playoff, contested among the top eight ranked teams in America.

The Big Ten Conference is affiliated with the BCS, and its champion is automatically designated to go to the Rose Bowl in Pasadena, Calif., unless selected for the national championship game. The University of Minnesota has never played in a BCS game since the formation of the BCS in the late 1990s, and last played in a game currently affiliated with the BCS in 1962, when they beat UCLA in the Rose Bowl 21-3.

In 2009, Golden Gopher Athletic Director Joel Maturi told the Sports Business Journal that the BCS survives because of revenues, specifically that the power conferences like the Big Ten don’t want to get downgrade their piece of the pie. From SBJ:

Maturi, Minnesota’s AD, said there’s not an equitable system of distributing revenue because it’s not equitably generated. Nine of the 10 teams in BCS bowls last year represented the big six conferences.

“The BCS doesn’t want to share the money and that’s why there’s no football playoff,” Maturi said. “Let’s be honest. We bring in the money. Why should we share it? We need the money desperately because we’re paying coaches millions of dollars.”

BCS games are a financial windfall for the conferences selected, as bowl revenues are largely split among the conferences selected. BCS games pay out $18 million each. The largest payout for a non-BCS bowl game is the Big Ten-affiliated Capital One Bowl in Orlando, which doles out $4.25 million per participant. Split evenly among a 12-team conference, that’s more than $1 million per school lost by not making a BCS game.

To address some concerns of inequality, the BCS recently added a provision that the highest-ranking non-BCS-affiliated team will be selected, so long as it’s among the top 12 teams at the end of the season. However, smaller schools are routinely passed over by bowls for major teams that guarantee they’ll bring tens of thousands of fans, deliver big TV ratings and drive dollars to the host bowl game and their respective cities.

Officials at the University of Minnesota athletic department referred MinnPost to the Big Ten Conference, and a spokesman there did not immediately return a call seeking comment.

Update: BCS Executive Director Bill Hancock, reached by the Associated Press, scoffed at the potential investigation.

“Goodness gracious, with all that’s going on in the world right now and with national and state budgets being what they are, it seems like a waste of taxpayers’ money to have the government looking into how college football games are played,” he said.

Which, as political observers will very quickly note, is an answer that doesn’t fit the central question.

My quick take on this is that, as has been the case for years now, the BCS isn’t trying to win this case on its merits, but rather preserve the status quo via the court of public opinion.

BCS officials know full well that their best shot of staying as the BCS is if either a) the weight of public opinion is overwhelmingly on their side saying the BCS is a good thing, or b) the weight of public opinion is overwhelmingly on their side saying it’s a waste of the government’s time to step in and do something about it.

The antitrust case against the NCAA is sort of the nuclear option here. No doubt the NCAA feels its system is in full compliance. But no doubt the NCAA knows full well that if it loses such a case, then everything they do is on the table, including a fundamental restructuring of collegiate revenues away from universities, conferences and coaches toward players. It would be the ultimate game changer.

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