A summary of the proposed settlement:
"The proposed House v.
NCAA settlement, which includes the
landmark $2.78 billion settlement of three separate antitrust cases facing the NCAA and power conferences, received preliminary approval on Monday from Judge Claudia Wilken in the Northern District of California, clearing the way for schools to begin paying players directly through revenue sharing as early as 2025.
Lawyers representing both sides of the settlement — which aims to resolve the House, Hubbard and Carter antitrust lawsuits —
filed a revised version of the settlement agreement late last month t
hat aimed to clarify use of the term “booster,” the original language on third-party NIL collectives and what specifically constitutes the pay-for-play inducements the NCAA is aiming to eliminate as part of the settlement.
Wilken, who previously presided over the notable Alston and O’Bannon cases against the NCAA, did not provide any additional explanation for granting preliminary approval on Monday. The settlement is not yet finalized, though the motion Wilken signed states that the court “will likely be able to approve the Settlement as fair, reasonable, and adequate” while subject to a final approval hearing, which is tentatively scheduled for April 7, 2025.
If finalized, the agreement would establish $2.78 billion in retroactive damage payments for former college athletes dating back to 2016 who did not have the opportunity to earn compensation for their NIL.
It would also allow college athletic departments to opt into revenue sharing directly with current and future college athletes, starting at north of $20 million annually per school.
Another critical aspect of the settlement from the NCAA’s perspective is
renewed enforcement of NIL rules intended to eliminate pay-for-play payments that have become commonplace among booster-led NIL collectives.
The proposed terms allow the NCAA and power conferences to form a “designated enforcement agency,” which the revised agreement specifies would focus on NIL deals stemming from individuals affiliated with an NIL collective, involved in a player’s recruitment, or from families that have contributed more than $50,000 to a university’s athletic department over the course of their lifetime.
There have already been objections to the settlement, including one last week from
the lead attorney in the O’Bannon v. NCAA case that was decided in 2014 and helped pave the way for college athletes to eventually earn NIL compensation.
The objection argues that the damages portion of the settlement is too low, the cap on revenue sharing is unlawful and restrictions on NIL collectives are unfair.
The preliminary approval hearing last month also featured objections from two dissenting groups: one representing a group of women’s rowing athletes
arguing the allocation structure for the damage payments is unfair to female athletes, and another representing the Fontenot v. NCAA case, a separate antitrust suit filed in Colorado that is seeking claims similar to the Carter case and
argues the NCAA’s rules prohibiting pay-for-play compensation violate antitrust law.
An approved settlement will not resolve all of the NCAA’s legal battles — including employment status and collective bargaining efforts, possible Title IX complaints or other antitrust litigation — which is why the organization will continue to pursue antitrust exemptions and federal NIL legislation through Congress.
If final approval is granted in April, the settlement would immediately go into effect, with the direct revenue sharing between schools and college athletes starting in July 2025."
NY Times, Oct. 7, 2024.
