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Federal Appeals Court Strikes Down Plan to Pay College Athletes

Lance King/Getty Images(NEW YORK) -- A federal appeals court ruled on Wednesday that NCAA rules restricting payment to student-athletes violate antitrust laws. 

The judges encouraged universities to offer scholarships to student-athletes up to the full cost of attendance but struck down a plan to pay them up to $5,000 a year in deferred compensation.

“We have not completely reviewed the court’s 78-page decision, but we agree with the court that the injunction ‘allowing students to be paid cash compensation of up to $5,000 per year was erroneous,’” NCAA President Mark Emmert said in a statement following the court's decision. “Since Aug. 1, the NCAA has allowed member schools to provide up to full cost of attendance; however, we disagree that it should be mandated by the courts.”

The case is a defeat for former UCLA standout Ed O'Bannon, who sued after he was depicted in a college basketball video game.

But while this ruling means college athletes cannot be paid for their name, image or likeness, it does open the door to the idea of completely paying college athletes or not paying them at all.

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