The NCAA and the top five conferences in the country will meet on Thursday night. Paying about $2.8 billion to settle numerous antitrust lawsuitsThe decision is a landmark one that lays the groundwork for a groundbreaking revenue-sharing model that could see millions of dollars paid directly to athletes starting as early as the fall semester of 2025.
NCAA President Charlie Baker, along with the commissioners of the Atlantic Coast Conference, Big Ten, Big 12, Pac-12 and Southeastern Conference, Settlement Terms. They called the move “an important step toward continuing reform of college sports that will benefit student-athletes and bring transparency to all sectors of college sports for years to come.”
The agreement must be approved by the federal judge overseeing the case and could be challenged, but if it goes through, it would usher in a new era in college sports in which players will be compensated more like professional players and schools will be able to use direct payments to attract talent.
“There’s no question about it. This is a big leap,” said Tom McMillen, a former Maryland basketball player and congressman who has led the Association of College Athletic Directors for the past eight years.
No terms were disclosed, but some details have emerged in the past few weeks. It marks the end of the amateurism model that has been the backbone of the NCAA since its founding in 1906. Indeed, the days when the NCAA could penalize players for driving cars provided by sponsors began disappearing three years ago. Lifting sponsorship restrictions It is fuelled by what is called name, image and likeness money.
It’s not unrealistic these days to expect a college basketball team’s star quarterback or top prospect to have a season where he or she not only earns money on a big NIL contract, but also has $100,000 in their bank account to play for.
“This landmark settlement brings college sports into the 21st century and ensures that college athletes will finally receive their fair share of the billions of dollars in revenue they bring to their schools,” said Steve Berman, one of the lead attorneys for the plaintiffs. “Our clients are the foundation of the NCAA’s multi-billion dollar business and will finally be able to receive compensation for their extraordinary athletic abilities in a fair and equitable manner.”
lots of The details have not yet been decided, But the agreement also calls for the NCAA and the conferences to pay $2.77 billion over 10 years to more than 14,000 former and current college athletes who say they were denied income from endorsement deals since 2016 because of the now-defunct rule.
“It was only because of overwhelming legal pressure that the NCAA, conferences and schools agreed that college athletes should be paid,” said Ramogi Huma, a former UCLA football player and longtime college athlete advocate. “And there’s been no turning back from that. This is truly groundbreaking.”
The money will come in part from NCAA reserve funds and insurance, even though the lawsuit specifically targets five conferences that comprise 69 schools (including Notre Dame). Dozens of NCAA member schools The NCAA will provide a small share to cover the large payout.
Schools in the Big Ten, Big 12, Atlantic Coast and Southeastern Conferences will each pay about $300 million in settlement payments over 10 years, the bulk of which will be paid out to players in the future.
The Pac-12 is also part of the settlement, meaning all 12 current schools will share responsibility, though only Washington State and Oregon State will remain in the league by this fall after 10 other schools dropped out.
Rewarding athletes
Under the new compensation model, schools would be allowed but not required to share up to $21 million in annual revenue with players, though any increase in revenue could lead to an increase in the cap.
Athletes in all sports would be eligible for scholarships, and schools would have the freedom to decide how to distribute those funds among their sports programs. Scholarship limits by sport would be replaced with enrollment limits.
It’s unclear whether the new compensation model would fall under Title IX gender equality laws, and it’s also unclear whether schools will be able to bring NIL activities in-house as they hope and eliminate the sponsorship groups that have proliferated in recent years as a way to compensate players — both issues that could lead to further litigation.
Case
The federal class action lawsuit at the center of the settlement was: House of Representatives v. NCAA; A trial was scheduled for January.The lawsuit, filed by former Arizona State University swimmer Grant House and University of Oregon and now TCU basketball player Sedona Prince, alleges that the NCAA and the five wealthiest conferences unfairly barred athletes from earning sponsorship money.
The lawsuit also argued that players are entitled to a share of the billions of dollars the NCAA and conferences make from media rights deals with television networks.
Amid political and public pressure, and facing the possibility of new legal losses that some in college sports say could cost them as much as $20 billion in damages, NCAA and conference officials acknowledged what has long been a core principle of the business: schools do not pay athletes directly for playing, beyond their scholarships.
This principle has been shaken many times over the past decade, most notably by the Supreme Court, which unanimously Competing against the NCAA in 2021 Cases relating to education-related benefits.
While the narrow focus of the Alston case meant that the college athletics system did not collapse, its strong condemnation of the NCAA’s model of amateurism opened the door for further litigation. Justice Brett Kavanaugh, a former Yale athlete, bluntly stated, “At the end of the day, the NCAA and its member universities are suppressing the compensation of student-athletes who generate billions of dollars in revenue for their universities each year.”
Other cases
The settlement is two Other Antitrust Lawsuits The NCAA and major conferences are challenging the athlete compensation rules, and the cases Hubbard v. NCAA and Carter v. NCAA are also currently being heard before a judge in the Northern District of California.
The fourth case, Fontenot v. NCAA, could remain complicated even after the justices hand down their ruling in a Colorado court filing. Request Denied Combine that with Carter. It’s unclear if Fontenot will be part of any settlement, but this is important because the NCAA and its conferences don’t want to be saddled with further damages if they lose in court.
“We will continue our litigation in Colorado and look forward to hearing the terms of the settlement once it is actually announced and filed in court,” said Fontenot plaintiffs’ attorney George Zerkes.
Reforming university sports
The settlement reached in the settlement is groundbreaking, but not surprising: College sports has been moving in this direction for years, with players increasingly receiving long-awaited financial benefits and rights.
In December, former Massachusetts Governor Baker, who had been in office for 14 months, Proposed the creation of a new tier for Division I athletics. The richest schools would be required to pay at least half of their athletes $30,000 a year. The proposal, along with many other possibilities, is still under discussion.
The settlement does not solve all the problems facing college sports. Deemed employee Their schools are a big part of Baker and other college sports leaders’ lives. Fighting.
Some sort of federal or antitrust exemption would likely be needed to codify the terms of the settlement, protect the NCAA from future lawsuits and thwart state laws that seek to cripple the organization’s power. The NCAA still faces lawsuits These include imposing rules limiting multiple transfers, which calls into question its ability to govern itself.
“This settlement also serves as a roadmap for college athletics leaders and Congress to ensure this uniquely American institution continues to provide unparalleled opportunities for millions of students,” the joint statement said. “Everyone at Division I made today’s progress possible, and we all have work to do to implement the terms of the agreement as the legal process continues. We look forward to working collaboratively with a diverse group of student-athlete leaders to write the next chapter in college athletics.”
Federal lawmakers have indicated they want to get something done. Several bills have been introduced Nobody is going anywhere.
Despite the unanswered questions, one thing is clear: major college sports will look more like professional sports than ever before.
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