For several years, reigning two-time Worst Company In America Electronic Arts has been fighting a lawsuit filed by former college athletes that accused the video game publisher, along with the NCAA and a third-party licensing firm, of illegally profiting off the likenesses of student-athletes. Now that it looks like the case could finally go to trial, EA has reached a settlement with the plaintiffs — and has ditched plans to put out a college football game in 2014.
It was already known that EA would not put out an official, NCAA-branded football game next year when the collegiate sports organization announced in July that it would not renew its agreement with the publisher.
But today, at the same time that it was revealed that EA had agreed to a settlement with the former student-athletes, it also issued a statement saying it would not be publishing a new college football game next year. Furthermore, the company says it is “evaluating our plan for the future of the franchise.”
In spite of the settlement, this statement from EA is defensive in tone. Not only does the company fail to admit guilt, it mocks the claims of the plaintiffs:
We have been stuck in the middle of a dispute between the NCAA and student-athletes who seek compensation for playing college football. Just like companies that broadcast college games and those that provide equipment and apparel, we follow rules that are set by the NCAA – but those rules are being challenged by some student-athletes… The ongoing legal issues combined with increased questions surrounding schools and conferences have left us in a difficult position – one that challenges our ability to deliver an authentic sports experience, which is the very foundation of EA SPORTS games.
Lawyers for the plaintiffs in the case sent out an announcement this afternoon declaring that a settlement has been agreed to, but still requires the approval of the court. No specifics of the settlement were made available, though it’s believed that payments could be made to each of the more than 100,000 student-athletes who played on the college football teams included in EA’s NCAA Football games during the years covered by the suit.
“I can say that we are extraordinarily pleased with this settlement, whose terms we will be proud to present to the court and to the public,” said Steve Berman, a lead attorney in case against EA. “When we began this case in 2009, we were venturing into a new application of the law, with little precedent, while facing monumental legal hurdles.”
The lawsuit had claimed that EA, CLC, and the NCAA were all illegally profiting off college athletes’ likenesses without permission. The defendants had made multiple attempts to get the case dismissed, claiming everything from First Amendment protection to trying to convince the court that the alleged concerted decision to deliberately use players likenesses was not an antitrust conspiracy.
“Students agreed that by being student-athletes that they could not exploit their personal commercial value, an agreement they lived up to,” Berman added. “The same cannot be said about the NCAA or its partner Electronic Arts.”
The NCAA has still not settled with plaintiffs. Berman says that settling the claims against EA allows the plaintiffs to focus on the remaining case against the athletics group.
“We hold that the NCAA intentionally looked the other way while EA commercialized the likenesses of students, and it did so because it knew that EA’s financial success meant a bigger royalty check to the NCAA,” he explains.