The NCAA sued Electronic Arts and Collegiate Licensing Company, alleging that the video game developer and licenser failed to maintain sufficient insurance to cover claims made by players and asking that the parties' proposed settlement with players be stopped. According to Steve Berkowitz of USA Today, the NCAA filed the suit in a Georgia state court on Nov. 4, alleging that Electronic Arts failed to maintain sufficient insurance to cover the claims and attorney fees associated with the O'Bannon suit.
The landmark lawsuit, which began as a challenge to EA's NCAA Football franchise, has become a case about the millions of dollars paid for television rights to NCAA football and basketball broadcasts. EA and the CLC announced a $40 million settlement with the O'Bannon plaintiffs two months ago. The settlement left the NCAA as the sole remaining defendant against the players, with television as the sole remaining issue. The NCAA's suit demands that the settlement be annulled, bringing EA and the CLC back into the case and putting those issues back on the table.
According to AL.com's Jon Solomon, the NCAA sees a serious threat in the possibility of a partial settlement:
The NCAA says it will suffer "irreparable harm" if EA and CLC "succeed in their apparent effort to circumvent their contractual and fiduciary duties owed to the NCAA by petitioning the Northern District of California to approve a settlement bar order that is permanently prejudicial to the NCAA's pre-existing contractual rights."
The NCAA also demands that EA be required to pay any judgment against the NCAA related to EA's video games, though such a judgment is not likely given the previous settlement.