The opinion
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8 UNITED STATES DISTRICT COURT
9 NORTHERN DISTRICT OF CALIFORNIA
10 San Francisco Division
11 DOMINIK CALHOUN, et al., Case No. 25-cv-04603-LB
12 Plaintiffs, ORDER GRANTING MOTION TO
DISMISS
13 v.
Re: ECF No. 84
14 CALIFORNIA INTERSCHOLASTIC
FEDERATION, et al.,
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Defendants.
16
17 INTRODUCTION
18 This putative class action challenges a single rule governing California high-school athletics.
19 In an order dismissing the original complaint, the court held that the California Interscholastic
20 Federation and its ten regional sections (together, CIF) are immune under Parker v. Brown from
21 antitrust challenges to their amateurism and transfer rules but not from a challenge to a rule
22 barring student-athletes from licensing their name, image, and likenesses (NIL) in connection with
23 their school-affiliated identities (such as school uniforms, insignia, and team affiliation). The court
24 dismissed the complaint’s markets as implausibly pled and gave the plaintiff leave to amend the
25 market allegations and to add a plaintiff with standing for prospective relief.1
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1 Order – ECF No. 77 at 2, 14–19. Citations refer to the Electronic Case File (ECF); pinpoint citations
1 The first amended complaint narrows the case to the NIL rule. It adds Patrick Hall as a plaintiff,
2 limits the alleged labor market to high-school varsity athletes and divides it into sport-specific
3 submarkets, and adds allegations meant to show that the NIL for California high-school athletes is
4 not interchangeable with the NIL for athletes in other states or who play different sports.2 CIF
5 moves to dismiss. It contends that (1) the plaintiffs plead no injury because the immune amateurism
6 and transfer rules and state law foreclose the compensation that the NIL rule allegedly denies and
7 (2) the two alleged relevant markets remain implausibly pleaded.3 The parties agree that the state-
8 law claims rise or fall with the federal antitrust claims.4
9 The motion is granted for two independent reasons.
10 First, the plaintiffs again do not plead a plausibly relevant market, which the rule of reason
11 requires. The statewide varsity-labor markets are implausible because (1) the complaint attributes
12 the suppression of any such market to the amateurism and transfer rules that the court has held are
13 immune from challenge and (2) the markets are not defined by reference to reasonable
14 interchangeability. The national NIL market fails for the same interchangeability reasons
15 identified in the prior order: the amended complaint still does not explain why California high-
16 school NIL is not reasonably interchangeable with the NIL of athletes in other states or with the
17 NIL of other athletes who play different sports at different skill levels. The plaintiffs’ fallback —
18 direct evidence of anticompetitive effect excuses a market definition — does not apply to a rule-
19 of-reason claim like this one.
20 Second, independently, the plaintiffs plead no antitrust injury for their two principal theories of
21 lost compensation: the opportunity to be paid by licensing their school-affiliated NIL and any
22 share of broadcast revenue. Both opportunities are barred not by the challenged NIL rule but
23 instead by the immune amateurism and transfer rules and by Cal. Civ. Code § 3344(d). An injury
24 that an independent lawful constraint would inflict is not injury caused by the challenged conduct.
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2 First Am. Compl. (FAC) – ECF No. 81 at 8–9 (¶¶ 14–19), 27 (¶ 78), 33–36 (¶¶ 95–103).
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3 Mot. – ECF No. 84 at 12–23.
1 Because the Sherman Act theories (and claims) fail, the Cartwright and Unfair Competition
2 Law (UCL) claims fall too. The dismissal is with leave to amend.
3
4 STATEMENT
5 1. The Prior Order
6 The original complaint challenged three sets of CIF rules: (1) the amateurism rules (capping
7 athletic awards and barring cash and other payments of value to student athletes) (CIF Bylaws
8 200(B), 212, 802(A)–(B)); (2) the transfer rules (governing a student athlete’s eligibility and
9 barring athletically motivated transfers and undue influence) (CIF Bylaws 201, 206, 207, and
10 510); and (3) the NIL rule (barring NIL licensing tied to school-affiliated insignia/identities) (CIF
11 Bylaws 212(C)(3)–(4)).5 The court held that (1) CIF is not an arm of the state and so lacks
12 Eleventh Amendment immunity, (2) CIF has state-action immunity under Parker v. Brown for the
13 amateurism and transfer rules but not the NIL rule, (3) the two alleged markets were not plausibly
14 pleaded, (4) the standing challenge was largely mooted by the immunity ruling, leaving the loss of
15 NIL compensation as the remaining alleged injury, and (5) the state law claims rise and fall with
16 the federal claims (which resulted in the dismissal of the UCL claim). The media defendants, who
17 had no connection to the challenged rules, were dismissed. The court gave leave to amend the
18 market allegations and to add a plaintiff with standing for prospective relief.6
19 On the NIL rule specifically, the court held that the plaintiffs plausibly pleaded a challenge
20 because (1) the record did not establish that the Legislature clearly intended to deprive student-
21 athletes categorically from sharing in revenues from their school-affiliated NIL, and (2) the NIL
22 rule was not a reasonably foreseeable result of section 3344(d), which allows the uncompensated
23 use of NIL in broadcasts but does not foreseeably authorize a categorical bar on student-athletes’
24 sharing revenues from school-affiliated NIL.7
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5 Order – ECF No. 77 at 5–7 (summarizing the challenged CIF rules).
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6 Id. at 2, 14, 17–20.
1 2. The Amended Complaint
2 The amended complaint has four substantive changes. First, it adds Patrick Hall, a junior
3 varsity-football player at Mater Dei High School who alleges that he appeared in school
4 promotional content without any compensation for school-affiliated use of his NIL.8 Second, it
5 states that the plaintiffs do not challenge the amateurism rules except to the extent that they might
6 be construed to interfere with their NIL monetization (and it deletes the prior discussion of the
7 transfer rules).9 Third, it limits the all labor market to California high-school “varsity” athletes and
8 alleges that each varsity sport is an independent submarket.10 Fourth, it adds allegations meant to
9 distinguish California high-school NIL from out-of-state and cross-sport NIL, chiefly that
10 broadcast advertisers value local audiences and that football and basketball players would not
11 switch to “less elite” sports if NIL rules for other sports were relaxed.11
12 The amended complaint alleges two sets of relevant markets. The first is statewide markets for
13 the athletic labor of CIF varsity student-athletes, with each sport an independent submarket. The
14 plaintiffs allege that these markets “already exist[]” but are “heavily suppressed” by CIF’s
15 restrictions on “compensation for athletic labor, transfers for athletic reasons, and recruiting.”12
16 The second is a national market for the use of California high-school varsity athletes’ NIL for
17 commercial and promotional purposes, including in broadcasts (specifically, “live or prerecorded
18 broadcasts of athletic competitions . . . and in sports data and marketing software”).13
19 The plaintiffs’ alleged injury is that, but for the NIL rules, CIF member schools and sections
20 would compete to recruit and pay student athletes for their labor by offering less restrictive NIL
21 rules or a share of NIL revenues, and that the plaintiffs would have earned money either by
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8 FAC – ECF No. 81 at 8–9 (¶¶ 14–19).
25 9 Id. at 20 (¶ 52); see Blackline – ECF No. 81-1 at 24 (¶ 52) & 26–32 (deleted text).
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10 FAC – ECF No. 81 at 27 (¶ 78).
11 Id. at 38–40 (¶¶ 96–103).
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12 Id. at 27 (¶¶ 79); see also id. at 27–33 (¶¶ 80–94).
1 licensing their school-affiliated NIL or by sharing in broadcast revenue.14 They assert claims under
2 section 1 of the Sherman Act (claims one and two), the Cartwright Act (claims three and four), and
3 the UCL (claim five).15
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5 3. Procedural History
6 The parties have consented to magistrate-judge jurisdiction.16 28 U.S.C. § 636(c). The court
7 held a hearing on the motion to dismiss on August 20, 2026.
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9 LEGAL STANDARDS
10 A complaint must contain “a short and plain statement of the claim showing that the pleader is
11 entitled to relief.” Fed. R. Civ. P. 8(a)(2). To survive a Rule 12(b)(6) motion, it must plead “enough
12 facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544,
13 570 (2007). The court accepts well-pleaded facts as true and draws reasonable inferences for the
14 plaintiff, but it need not accept conclusory allegations, unwarranted deductions, or unreasonable
15 inferences. Daniels-Hall v. Nat’l Educ. Ass’n, 629 F.3d 992, 998 (9th Cir. 2010). In antitrust cases,
16 “the fact of injury or damage must be alleged at the pleading stage,” and conclusory allegations of
17 injury do not suffice. Somers v. Apple, Inc., 729 F.3d 953, 963 (9th Cir. 2013).
18 Unless it is asserting a per se claim, under the rule of reason, a plaintiff must plead a plausible
19 relevant market defined by reasonably interchangeability and cross-elasticity of demand. Hicks v.
20 PGA Tour, Inc., 897 F.3d 1109, 1120 (9th Cir. 2018); Big Bear Lodging Ass’n v. Snow Summit,
21 Inc., 182 F.3d 1096, 1104–05 (9th Cir. 1999); In re eBay Seller Antitrust Litig., 545 F. Supp. 2d
22 1027, 1031 (N.D. Cal. 2008). A proposed market that “clearly does not encompass all
23 interchangeable substitute products” or that includes products that are not interchangeable is
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14 Id. at 7 (¶ 13), 9 (¶ 19), 48 (¶ 137).
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15 Id. at 5 (¶ 4), 72–79 (¶¶ 209–54).
1 legally insufficient, and a motion to dismiss may be granted. In re eBay, 545 F. Supp. 2d at 1031
2 (cleaned up).
3 Article III standing requires that a plaintiff suffers (1) an injury in fact (2) fairly traceable to
4 the challenged conduct of the defendant (3) that is likely to be redressed by a favorable judicial
5 decision. Spokeo Inc. v. Robins, 578 U.S. 330, 338 (2016). Antitrust standing additionally requires
6 antitrust injury: “(1) unlawful conduct, (2) causing an injury to the plaintiff, (3) that flows from
7 that which makes the conduct unlawful, and (4) that is of the type the antitrust laws were intended
8 to prevent.” City of Oakland v. Oakland Raiders, 20 F.4th 441, 456 (9th Cir. 2021) (cleaned up).
9 “Recovery will not be permitted for injuries which have been independently caused by something
10 other than the antitrust violation.” L.A. Mem’l Coliseum Comm’n v. Nat’l Football League, 791
11 F.2d 1356, 1366 (9th Cir. 1986).
12 ANALYSIS
13 1. The Amended Complaint Does Not Plead a Plausible Relevant Market
14 The surviving claim is a rule-of-reason challenge to the NIL rule. The plaintiffs thus must
15 plead a plausible relevant market. Hicks, 897 F.3d at 1120. Defining the market is a “threshold
16 step” in rule-of-reason case, and a facially implausible market warrants dismissal. Epic Games,
17 Inc. v. Apple, Inc., 67 F.4th 946, 974–74 (9th Cir. 2023); In re eBay, 545 F. Supp. 2d at 1031. The
18 amended complaint pleads two markets, and neither is plausible.
19 1.1 The Statewide Varsity Athletic-Labor Market
20 The market fails for two reasons.
21 First, there is no plausible labor market that is suppressed by the NIL rules because (as
22 pleaded) any suppression of a competitive labor market is caused by the immune amateurism and
23 transfer rules, not the NIL rules challenged here. The amended complaint alleges that the labor
24 markets are “heavily suppressed by CIF’s anticompetitive restrictions on compensation for athletic
25 labor, transfers for athletic reasons, and recruiting.”17 These are the amateurism and transfer rules,
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1 not the NIL rule, and the court has held them immune under Parker.18 A market that cannot exist
2 except by lifting immune restraints is not a market suppressed by the NIL rule. The relabeling of
3 the market as “varsity” and its division by sport does not change that conclusion.19
4 Second, the markets are not defined by reasonable interchangeability.20 Big Bear, 182 F.3d at
5 1105; In re eBay, 545 F. Supp. 2d at 1031. The amended complaint does not explain why a student
6 playing a given sport would treat every high school in the state as interchangeable or why a school
7 recruiting for a sport would treat every student-athlete as interchangeable. The “switching”
8 allegations — that football and basketball players would not take up badminton or soccer if NIL
9 rules for those sports were relaxed21 — speak to whether sports are distinct, not to
10 interchangeability among schools or among athletes within a sport, which is the relevant question.
11 The geographic aspect of the market definition is also unexplained: the complaint both assumes
12 statewide mobility and concedes that the most sought-after athletes move across state lines,22
13 which means that the alleged statewide market lacks a basis. Even if each sport is a submarket, the
14 complaint does not supply the “rough contours” of any market. Intel Corp. v. Fortress Inv. Grp.
15 LLC, No. 19-cv-07651-EMC, 2020 WL 6390499, at *7 (N.D. Cal. July 15, 2020); Golden Gate
16 Pharmacy Servs., Inc. v. Pfizer, Inc., 433 F. App’x 598, 599 (9th Cir. 2011).23
17 1.2 The National NIL Market
18 The court previously identified two issues with reasonable interchangeability in the plaintiffs’
19 national-market theory: the pleadings did not establish (1) why California high-school athletes’ NIL
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18 Order – ECF No. 77 at 15, 17. At the argument on the first motion to dismiss, the plaintiffs’ counsel
likewise identified the transfer rule, not the NIL rule, as the mechanism that would “stimulate
22 competition” for athletes and that the amateurism rules are what “prevent schools from providing any
form of compensation to students.” 12/18/2025 Tr. – ECF No. 75 at 67 (p. 67:8–23).
23 19 Mot. – ECF No. 84 at 20 (making this point).
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20 Order – ECF No. 77 at 19.
21 FAC – ECF No. 81 at 34–35 (¶¶ 99, 101).
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22 Id. at 30–31 (¶¶ 86–89).
26 23 The plaintiffs contend that the existence of a labor market is a question of fact, not law, and is not
amenable to resolution on a motion to dismiss. Opp’n – ECF No. 88 at 20–21. A relevant market is a
27 fact-intensive inquiry, but this does not preclude a determination at the pleadings stage about whether a
market definition is facially unsustainable. Biddle v. Walt Disney Co., 696 F. Supp. 3d 865, 882 (N.D.
1 is not reasonably interchangeable with the NIL of athletes in other states and (2) why the NIL of
2 elite athletes is reasonably interchangeable with that of other athletes.24 The amended complaint
3 does not fix these issues.
4 On the interstate issue regarding athletes from other states, the new allegations are that
5 advertisers buy local audiences (such as a San Diego or Los Angeles car dealership advertising on
6 local broadcasts).25 That supports the existence of a local market, not the national market that the
7 plaintiffs allege. It does not allege why, for advertisers seeking national audiences, California
8 athletes’ NIL is not reasonably interchangeable with the NIL of high-school athletes from other
9 states.26 The allegation that broadcasting is consolidated to facilitate regional and national ad buys,
10 which the court flagged before, continues to suggest interchangeability rather than the opposite.27
11 The pleading also does not address the substitutes a national advertiser might use such as college
12 athletes, professional athletes, celebrities, influencers, and others.28
13 On the intrastate issue, the alleged market still lumps together the NIL of thousands of varsity
14 athletes of varying skill. The plaintiffs’ allegation that “every team member’s NIL is just as
15 important as any other team member’s NIL” is not consistent with the allegation that elite athletes’
16 NIL is not interchangeable with that of lesser athletes.29 There is no explanation about why a single
17 market embraces both. The group-licensing allegation does not save the market definition: the
18 plaintiffs plead no facts about how NIL is licensed on a group basis, and section 3344(d) provides
19 that a broadcast use of a student-athlete’s NIL “shall not constitute a use for which consent is
20 required.” There thus is no plausible market for broadcast group licenses the law does not require.30
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24 Order – ECF No. 77 at 19.
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25 FAC – ECF No. 81 at 33–34 (¶ 96).
25 26 Id.
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27 Order – ECF No. 77 at 19.
28 Mot. – ECF No. 84 at 22.
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29 FAC – ECF No. 81 at 34 (¶ 99), 36 (¶ 103).
1 1.3 The Direct-Effects Theory Does Not Excuse a Market Definition
2 The plaintiffs contend that direct evidence of anticompetitive effects means that they do not
3 have to plead a plausible market.31 That route is available for per se claims and for the limited
4 “quick look” claims. PLS.com, LLC v. Nat’l Ass’n of Realtors, 32 F.4th 824, 838–39 (9th Cir.
5 2022); Epic Games, 67 F.4th at 974 n.6. Even where direct effects are alleged, a plaintiff must still
6 plead the “rough contours” of a relevant market defined by reasonable interchangeability. Intel,
7 2020 WL 6390499, at *7; Golden Gate Pharmacy Servs., 433 F. App’x at 599. The plaintiffs’
8 citation to O’Bannon v. NCAA does not change this. There the relevant college-education market
9 was established and undisputed, and the schools had fixed athlete NIL valued at zero, whereas
10 here the plaintiffs concede that student-athletes may monetize NIL without school insignia.32 802
11 F.3d 1049, 1071 (9th Cir. 2015).
12 In sum, the plaintiffs do not plead plausible relevant markets, which resolves the motion to
13 dismiss. The court nonetheless addresses antitrust injury in the next section.
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15 2. Independently, the Plaintiffs Do Not Plead Antitrust Injury
16 The plaintiffs have two theories of injury: (1) lost payments from schools for school-affiliated
17 NIL and (2) a lost share of schools’ broadcast revenue.33 Neither theory alleges an injury caused
18 by the challenged NIL rule.
19 The school-payment theory is foreclosed by the immune amateurism and transfer rules.34 The
20 amateurism rules prohibit payment to student-athletes for the use of school-affiliated NIL (whether
21 cash or a license of school insignia that lets athletes earn more). The court held these rules to be
22 immune. An injury that an immune, independent restraint would inflict regardless of the
23 challenged rule is not antitrust injury. L.A. Mem’l Coliseum, 791 F.2d at 1366;
24 PharmacyChecker.com LLC v. LegitScript LLC, 137 F.4th 1031, 1045–46 (9th Cir. 2025).
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31 Opp’n – ECF No. 88 at 23–24.
32 FAC – ECF No. 81 at 22–23 (¶ 63); Order – ECF No. 77 at 6–7, 15–16.
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33 FAC – ECF No. 81 at 7 (¶ 13), 9 (¶ 19), 48 (¶ 137), 59 (¶ 170).
1 The plaintiffs’ response — that the amateurism rules reach only cash and enumerated awards,
2 not NIL licenses — does not survive the text of the rules, which cap “athletic awards” by total
3 “value” and are not limited to cash.35 The point is not that the plaintiffs are engaged in illegal
4 conduct. It is that an independent lawful restraint (the immune rules), not the challenged rule, is
5 the source of the claimed injury. PharmacyChecker.com, 137 F.4th at 1045–46.
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7 3. The State Claims Fail Because the Federal Claims are Dismissed
8 The parties agree, and the court previously held, that the Cartwright Act and UCL claims are
9 analyzed under the standards that apply to the Sherman Act claims.36 Because the Sherman Act
10 claims are dismissed, the Cartwright Act and UCL claims are dismissed too.
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12 4. Leave to Amend
13 Leave to amend should be freely given unless amendment would be futile, the plaintiff has
14 repeatedly failed to cure, or there is undue delay, bad faith, or prejudice. Foman v. Davis, 371 U.S.
15 178, 182 (1962); Eminence Cap., LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003).
16 Whether to grant leave here is close. That said, the dismissal turns on pleading deficiencies
17 that are not incurable as to a narrowed, non-broadcast theory. The court also did not previously
18 address antitrust injury. The court thus dismisses with leave to amend, limited to repleading a
19 plausible non-broadcast, school-affiliated NIL market and a corresponding injury theory consistent
20 with this order. The plaintiffs may not reassert the dismissed labor-market or broadcast-NIL
21 theories.
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35 CIF Bylaws 212(C), 802(A)–(B), 802(D); Opp’n – ECF No. 88 at 12–13; Reply – ECF No. 89 at 8–
10.
27 36 Order – ECF No. 77 at 19–20 (citing StubHub, Inc. v. Golden State Warriors, LLC, No. 15-cv-1436-
MMC, 2015 WL 6755594, at *4 (N.D. Cal. Nov. 5, 2015)); Opp’n – ECF No. 88 at 24; Reply – ECF
1 CONCLUSION
2 The motion to dismiss is granted. Any amended complaint is due by September 10, 2026, and
3 must include a blackline compare of the amended complaint against the current complaint.
4 This resolves ECF No. 84.
5 IT IS SO ORDERED.
6 Dated: August 20, 2026 Lit EC
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LAUREL BEELER
8 United States Magistrate Judge
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