When a school joins the NCAA they agree to be bound by their decisions. Penn St can opt out (but they wont).
True to an extent. They agree to be bound by NCAA decisions as long as the NCAA follows their bylaws.
It's just like being in a townhome association. If they have in their bylaws that you can't add on to your house and then you go and add on to your house, they can punish you within the confines of the bylaws. However, if there is nothing in the bylaws about interior color, and the board decides they don't like your dayglo green wall inside your house, they have no authority to punish you and any punishment they did render would be found non-binding in court.
The argument many people are making is that they don't feel the NCAA had the right to punish in this manner based on their bylaws.
However, there are three facts those people are missing:
1. The NCAA has a general ethics clause that states they can punish based on lack of ethics. This had never been imposed by itself to my knowledge before PSU, but that doesn't mean it can't be done. (Just like police almost never give tickets for 1 MPH over the limit but it doesn't mean they wouldn't be legal).
2. The punishment was agreed to by the school. That is going to be the killer for any legal action. Any lawsuit would have to prove
illegal coercion by the NCAA to force PSU to agree or show that PSU did not have the legal right to agree to the sanctions without permission from the Pennsylvania state government (Governor, Legislature, Sec of Ed, whatever).
3. The NCAA has another clause that allows punishment for any reason if agreed to at the annual fall meeting. Supposedly the NCAA member schools were nearly 100% behind this punishment (as a minimum) and if PSU fought it likely would have used this clause to punish them even worse.
It instead used the Freeh Report which was an investigation (paid for by Penn State) that didn't talk to McQueery, didn't talk to Paterno, didn't talk to Schultz, didn't talk to Spanier, didn't talk to Curley, didn't talk to Sandusky.
From USAToday 7/23/12: "Emmert said the report, which drew upon more than 3 million documents, was more comprehensive than any investigation the NCAA ever could have conducted."