Is the television plan a reasonable restraint

Assignment Help Business Law and Ethics

Reference no: EM131390688

The National Collegiate Athletic Association (NCAA) adopted a plan for televising college football games in order to reduce the adverse effect of television coverage on spectator attendance. The plan limited the total number of televised intercollegiate football games and the number of games any one school could televise. No member of the NCAA was permitted to sell any television rights except in accordance with the plan.

As part of the plan, the NCAA had agreements with the American Broadcasting Company (ABC) and the Columbia Broadcasting System (CBS) to pay to each school at least a specified minimum price for televising football games. Several member universities now join to bring suit against the NCAA, claiming the new plan is a horizontal price-fixing agreement and output limitation and as such is illegal per se. The NCAA counters that the existence of the product, college football, depends upon member compliance with restrictions and regulations.

According to the NCAA, its restrictions, including the television plan, have a procompetitive effect. Is the television plan a reasonable restraint? Explain.

Reference no: EM131390688

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