Great American Assurance Company, the insurance provider for the National Collegiate Athletics Association and the Big Ten, never agreed to cover the concussions, chronic traumatic encephalopathy, or other potentially career-ending injuries football players are prone to suffering. They'll cover the less violent sports -- even field hockey, soccer and baseball -- but not football.
After a series of revelations that football players who are repeatedly put back into games after concussions can sustain permanent brain injury, Great American filed a federal lawsuit to get out of covering those injuries for the Big Ten. It later filed a similar suit against the Ohio Valley Conference. It claims there has been a huge mistake.
"The primary policy mistakenly failed to reflect the agreement the Big Ten and Great American actually reached. Specifically, it does not include a Designated Activities endorsement that limits coverage to the 21 sports for which the Big Ten requested coverage and paid a premium. The Big Ten and Great American were mutually mistaken at the time the policy was issued that the written document reflected the actual agreement made," the complaint reads, according to the Courthouse News Service.
If the Big Ten and Great American were mutually mistaken, can the insurer dodge coverage?
In contract law, there are specific requirements before a contract can be considered valid, and one of them is a so-called "meeting of the minds." Both parties must agree to the contract or there is no contract. This traditional rule is still valid, but we don't see much of it in cases involving commercial contracts. For one thing, contracts between two businesses are typically negotiated with and/or reviewed by lawyers, so there's less chance of mistakes.
So, in principle, the insurer is right that it shouldn't have to cover football injuries if it never agreed to do so -- even if the Big Ten mistakenly believes it did agree. However, the courts won't just take Great American's word for it.
To prevail, the company must demonstrate the lack of agreement. It might do so by bringing forward past contracts where a designated activities endorsement was specifically included, in contrast to the current agreement. It might show the court a series of contracts with other conferences that signed the endorsement, in order to show it was requiring the endorsement for most of its other customers. Or, it might show that information required for the endorsement, such as attendance records, was missing.
What might Great American be trying to avoid paying?
If college football players are being injured through the negligence of their coaches, there may be liability claims brought against the schools, the conference and the NCAA. If those claims involve life-altering brain injuries, there' no doubt those claims could be expensive.
Like the National Football League, the NCAA is already subject to one settlement agreement regarding concussions, which was reached in January 2016. That agreement requires the NCAA to spend $70 million on a fund to test current and former college athletes for CTE or other brain injuries, and to revamp the rules for handling concussions in within the conferences. It also agreed to donate $5 million to concussion research.
That settlement is peanuts compared to the NFL's concussion settlement providing up to $5 million to each and every injured player who retired before July 7, 2014. The total settlement is expected to cost the NFL $1 billion.
The NCAA settlement doesn't cover individual injury claims. Separate personal injury lawsuits have been flooding in, and the Big Ten suits have already been consolidated into a single multidistrict lawsuit. Although NCAA athletes are not employees like NFL players, it's likely the schools, conferences and NCAA could still be held liable for their injuries under the theory that the athletes were owed a certain minimal standard of care which wasn't met. School liability is similar to premises liability under the law.
Will Great American be successful in dodging liability for football injuries? It's too soon to tell. There's no doubt the Big Ten and any other affected conferences will fight to hold them liable.