Client Bulletin #572

A federal judge in Indiana dismissed yesterday all that remained of a lawsuit filed by student athletes, alleging that they were "employees" and therefore entitled to the minimum wage under the Fair Labor Standards Act.

Don Prophete, Jim Goh, and Steve Moore of Constangy, Brooks, Smith & Prophete, LLP, represented the NCAA and hundreds of the university defendants.

The suit was initially filed in 2014 by Samantha Sackos, a soccer player for the University of Houston. Ms. Sackos contended that she and other student athletes were temporary employees and should have received the minimum wage. She sought to assert a class action on behalf of all student athletes at NCAA Division I schools. Ms. Sackos eventually dropped out of the case but was replaced by plaintiffs Lauren Anderson, Gillian Berger, and Taylor Hennig, all track and field athletes at the University of Pennsylvania.

The plaintiffs subsequently voluntarily dismissed all of the state-supported schools from the lawsuit on grounds of sovereign immunity, which generally protects governmental entities from lawsuits.

By the time of the court's ruling yesterday, the NCAA and 123 schools remained in the lawsuit. Because all of the three plaintiffs were current or former Penn students, the other schools moved for dismissal, arguing that the plaintiffs had no standing to sue them. U.S. District Court Judge William T. Lawrence agreed, and dismissed the claims without prejudice, which theoretically allows the plaintiffs to try again with amended claims, or by adding plaintiffs from other schools.

That may not be worth the trouble, though, because the judge also dismissed the claims against Penn on their merits – in other words, he specifically found that Penn was not the employer of the plaintiffs. The claims against Penn were dismissed with prejudice, meaning that the plaintiffs can never refile their claims against Penn unless Judge Lawrence's decision is reversed on appeal.

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