NCAA in "Deep Discussion" to Implement Revenue Sharing with Athletes

Each power conference is expected to vote on the settlement over the next few days, in anticipation of the NCAA’s Board of Governors potentially approving the agreement later this week. Attorneys for plaintiffs have set a hard deadline of Thursday for defendants – the NCAA and power conferences – to agree to settlement terms. 

The proposed settlement would entail the NCAA and all 32 Division I conferences paying $2.77 billion in damages. It also would enable schools, at their discretion, to share as much as $22 million in revenue with athletes, according to a copy of the proposed settlement summary obtained by On3.

What’s next? In the coming months, U.S. District Judge Claudia Wilken will need to certify the settlement agreement, and represented athletes in the case will have the opportunity to opt-out.
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Mavric said:
From a thread of Tweets here but I just copy/pasted the text for readability:

If/when the House case settles, it will result in a wave of legal issues. Here are some of the bigger ones:

1. NCAA/conferences vs #NIL collectives

The NCAA/P4 are hoping the House settlement eliminates collectives and they’re going to try and crack down on “pay for play.”  The thought is by allowing donors to give directly to schools (who can then pay athletes) it eliminates the need to give to collectives.  But with a cap & some schools worried about Title IX (more on that below), there may still be a need for collectives to compensate athletes.  If one school is only offering an athlete X directly from the school, but another is offering X plus Y from a collective that would obviously play a role in recruiting.  The NCAA/P4 are going to try and eliminate these collective payments through harsher enforcement/penalties.  Which is where I think we’ll see lawsuits arise.  It’s already happened with the Tennessee case.  The House settlement isn’t going to magically make it easier for the NCAA to enforce its rules.

2. Title IX

Some schools will assume Title IX applies to direct NIL compensation and  divide payments between male and female athletes equally.  Others either aren’t going to make that assumption or will assume that making payments in that manner will lead to other legal issues.  So lawsuits may arise under either scenario. I personally don’t think Title IX requires schools to make payments that are ostensibly for a license to use an athlete’s NIL rights equally between male and female athletes.  But the issue will no doubt be litigated.

3. Schools vs Athletes

When allowed to directly pay NIL compensation to athletes, schools and athletes will be entering into binding contracts. And there will be a lot of those contracts. It’s inevitable there will be issues with some of them that lead to legal disputes. I assume most will contain alternative dispute language, such as mandatory arbitration provisions. So this could be a really active space in the future.

4. Objections to the House settlement

Under the structure being discussed for the House settlement, all future DI athletes will be opted into the settlement’s revenue sharing terms. And if they don’t think they’re fair, they’ll be able to make annual objections with the court. There will likely be a number of these objections made. A big wildcard is if someone is able to organize a large number of athletes to object en masse. It could throw a big wrench in the plan for the House settlement to bring some peace to college athletics. 

5. Employment

The House settlement will do nothing to slow down the push for at least some college athletes to be employees. If the USC NLRB proceeding turns out the way most expect (with football and men’s and women’s basketball players being declared employees), we might see more of that.
 

Long story short, the many (and often novel) legal issues in college athletics are going to continue. It’s a fun time to be an attorney working in this space.
 

One other item I forgot to add.

6. State legislation

We’ve seen states aren’t shy about passing NIL laws that give their schools a leg up in recruiting. A state could do this after the House settlement by passing a law that allows schools to give unlimited NIL compensation.
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So to make a long story short, schools are going to agree to another model that is also probably illegally classifying athletes as something they aren't. 

This is inevitably going to lead to lawsuits schools lose - because courts have already determined that athletes deserve NIL. Courts are also obviously going to deem them employees where they will collectively bargain.

So for the next several years the sport is still going to be the wild west where courts change the rules on the fly. They just need to recognize them as employees and get it all over with. 

 


Wonder if the non-P4 leagues will follow suite in approving this, seems like the issue (if I'm reading and understanding the case right) was caused by P4 conferences, but most of the burden will be passed to the smaller conferences.  Pretty sweet deal for the P4, get sued for billions and make the smaller conferences who don't have the same revenue, pay for a greater share of the penalty.

 
Madcows said:
Wonder if the non-P4 leagues will follow suite in approving this, seems like the issue (if I'm reading and understanding the case right) was caused by P4 conferences, but most of the burden will be passed to the smaller conferences.  Pretty sweet deal for the P4, get sued for billions and make the smaller conferences who don't have the same revenue, pay for a greater share of the penalty.
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Per ESPN

Looking ahead to this week's House v. NCAA settlement votes - ESPN

There is significant pushback among leagues outside the power leagues on the proposed payment structure. According to a memo the NCAA sent to all 32 Division I conferences this week, the NCAA will use more than $1 billion from reserves, catastrophic insurance, new revenue and budget cuts to help pay the damages, sources told ESPN this week. The memo also states that an additional $1.6 billion would come from reductions in NCAA distributions, 60% of which would come from the 27 Division I conferences outside of the so-called Power 5 football leagues. The other 40% would come from cuts to the power conferences, which are the named defendants with the NCAA in the case.

Per a source, some members of the CCA22 are planning to send a letter to the NCAA requesting the responsibility be flipped -- with the power conferences contributing 60% of the damages and the other 27 leagues contributing 40%. In her message, Ackerman wrote that she expects former FBS football players will be "the primary beneficiaries of the NIL 'back pay' amounts" -- suggesting that the damages might not be shared equally among athletes.
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Dr. Strangelove said:
So to make a long story short, schools are going to agree to another model that is also probably illegally classifying athletes as something they aren't. 

This is inevitably going to lead to lawsuits schools lose - because courts have already determined that athletes deserve NIL. Courts are also obviously going to deem them employees where they will collectively bargain.

So for the next several years the sport is still going to be the wild west where courts change the rules on the fly. They just need to recognize them as employees and get it all over with. 
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#1 is what I don't understand.  NIL is outside of the U's control and they obviously want it back under their thumb.  But if the Us are distributing the NIL money then it triggers Title 9 and other legal obligations for others to get at it. 

 
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