College athletes that transfer twice can play now without NCAA waiver, federal judge rules

By Brian Murphy, WRAL Sports investigative reporter

College athletes who were waiting for an NCAA transfer waiver are now eligible to play, a federal judge ruled Wednesday in a case brought by seven state attorneys general, including North Carolina's Josh Stein.

Judge John P. Bailey issued a temporary restraining order in State of Ohio v. National Collegiate Athletic Association. The case, which alleges that the NCAA's rules on multiple transfers by athletes violates U.S. antitrust law, was filed last week in the Northern District of West Virginia.

Bailey ruled that for the next 14 days, the NCAA must refrain from enforcing its transfer eligibility rule that requires players to sit out for a year, the rule that kept UNC wide receiver Tez Walker off the field at the beginning of this football season in a high-profile case.

"As a result of today's decision impacting Division I student-athletes, the Association will not enforce the year in residency requirement for multiple-time transfers and will begin notifying member schools," the NCAA said in a statement.

Saquandra Heath, the NCAA's associate director of external communications, clarified that the non-enforcement is just for the 14-day order. Football players, for whom the portal is open, could transfer in the next 14 days and not be subject to the rule, Heath said in response to a question from WRAL.

The ruling could have an immediate impact on local college sports teams.

NC State basketball player Kam Woods and East Carolina basketball player Cam Hayes are among the athletes waiting for waivers. NC State and ECU declined to comment in the immediate aftermath of the ruling. The Wolfpack's next game is Saturday against Tennessee. ECU plays Florida on Friday.

"I am pleased that the Court has recognized that the NCAA’s transfer rule is unlawful,” Stein said in a statement. “I will keep fighting to protect student athletes to ensure that they are free to make their own decisions about what’s best for their futures, just like coaches, administrators and other students can.”

Representatives of the NCAA didn't immediately respond to a request for comment after the ruling.

No punishment

The judge also ruled that the NCAA can't punish players that play — or schools that allow them to play — while the temporary restraining order is in effect, even if the case is eventually decided for the NCAA.

The NCAA has a specific rule (12.11.4.2) that allows it to impose penalties or strike records if injunctions are "voluntarily vacated, stayed or reversed or it is finally determined by the courts that injunctive relief is not or was not justified." The lawsuit asked that the court stop the NCAA from enforcing its "restitution" rule.

"It appears to this Court that the Rule of Restitution’s purpose is to punish challenges to the NCAA’s anticompetitive rules by attempting to deprive courts of the ability to grant effective relief and depriving individual student-athletes and member institutions of the practical ability to rely on court orders in their favor," Bailey wrote in his order.

The judge scheduled the next hearing on a preliminary injunction for Dec. 27.

"For 14 days, the ruling brings an end to the NCAA forcing athletes to sit out a year," said Raleigh attorney Landis Barber, who listened to the hearing online and writes a blog about sports legal cases.

"More importantly, due to the state of Ohio's lawyers having to prove a likelihood of success on the merits for Judge Bailey to grant a temporary restraining order, the ruling forecasts how the Court will likely rule on the motion for a preliminary injunction."

NCAA transfer rule

In January, the NCAA instituted new rules for undergraduate students who transfer a second time that requires them to sit out a season or obtain a waiver from the organization. The rule unanimously passed the Division I Council, which includes a representative from each Division I athletic conference.

Players are eligible to transfer once as an undergraduate and also free to transfer after graduating without sitting out a season.

The waiver process has drawn attention and criticism. Wake Forest basketball player Efton Reid was recently granted immediate eligibility by the NCAA.

The NCAA granted for Walker after a long back-and-forth between the school and the NCAA that included lawyers and politicians, including Stein and Gov. Roy Cooper.

The NCAA said last week that it was disappointed that the seven state attorneys general decided to bring legal action.

The action came "with the tacit support of a small number of schools — the result of which could potentially mean team rosters changing monthly or weekly," Saquandra Heath, the NCAA's associate director of external communications, said in a statement last week. "The NCAA believes that if a member school objects to a rule or policy, that member should propose alternative rules that apply to everyone, not turn to lawsuits to bypass the system they designed.”

The judge asked the NCAA's attorneys how many waivers have been granted. The NCAA said it didn't have an exact figure but added that while a number had been granted, "most" had been denied.

"Why are we limiting student-athletes in this way?" Stein, a Democrat running for governor in 2024, said in an interview with WRAL last week. "They should be able to pursue their dreams just like any other American."

Stein compared athletes to students on music scholarships, administrators and coaches, such as Duke's Mike Elko, who accepted a new job at Texas A&M shortly after the Blue Devils' regular season ended.

"As long as a student-athlete is in good academic standing and is on track to graduate, he or she should be able to transfer schools," Stein told WRAL.