Written by Chris Vannini, Nicole Auerbach, and Justin Williams
Big 12 presidents and chancellors voted Tuesday to approve an expected multibillion-dollar settlement in the House of Representatives v. NCAA class action lawsuit, according to people briefed on the decision. Athletic. Their approval is another step toward resolving a landmark lawsuit that is likely to reshape the business model of college sports.
The Big 12 is scheduled to be the first defendant in the lawsuit to vote on the terms of the settlement, with the remaining power conferences and the NCAA Board of Governors also expected to vote this week. Details of the settlement include more than $2.7 billion in unpaid damages owed by the NCAA to former Division I players and future revenue sharing between powerhouse schools and players, according to people briefed on the negotiations. It is expected that this will include models. The damages, which have been provided to Division I athletes since 2016 as back pay for lost opportunities to earn name, image, and likeness (NIL), combine NCAA reserves with reduced future earnings. is likely to be paid out over 10 years. Distribution to conferences.
Revenue sharing would be an optional model for power conference programs that could occur as early as next year, with 22 percent of these schools’ average annual revenue, or about $20 million annually, going directly to athletes. .
If successful, the settlement, which will take several months to process, would be the next most significant overhaul of the long-standing amateurism framework in college sports.
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“The most important thing about this settlement is, to be honest, there’s still a lot of work to be done, but this settlement provides some clarity and visibility on a lot of issues that have been bothering everyone for some time. It’s about sexuality,” NCAA President Charlie Baker said at the ACC Spring Meetings last week. “The other thing is it brings predictability and stability to the school. It creates great opportunities for student-athletes.”
Once the NCAA and the power conference agree on terms and both sides of the lawsuit approve, the settlement will be submitted to Judge Claudia Wilken of the U.S. District Court for the Northern District of California for preliminary approval. If approved, there would be a period of approximately 90 days during which participants in the retroactive damages class would have the opportunity to opt out, and future revenue sharing class participants could object to the terms of the agreement. A final approval hearing will then be held, at which point the settlement will officially become effective if approved by the judge.
House v. NCAA was brought before Judge Wilken in 2020, the same judge who ruled specifically against the NCAA in O’Bannon and Alston. Former Arizona State swimmer Grant House and former Oregon State and current TCU women’s basketball player Sedona Prince are named plaintiffs and are represented by lead attorneys Steve Berman and Jeffrey Kessler.
It is essentially a two-part suit. One facing backwards and one facing forward. The former is seeking retroactive NIL damages from before the NCAA policy change in the summer of 2021, while the latter is seeking an injunction to force the NCAA and power conferences to lift rules that prevent revenue sharing from broadcast rights.
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In November, Wilken granted class action certification for the damages portion of the House lawsuit, expanding it to Division I players going back to 2016 based on the four-year statute of limitations, exponentially increasing the potential damages in the case, which is scheduled to go to trial in January 2025.
While a settlement would mark a major change for college sports and for the NCAA, which has long resisted compensating athletes, the NCAA has an incentive to avoid taking the case to court. If the NCAA loses in court, it could be sued for as much as $20 billion in damages, which it would have to pay immediately, according to a document circulated to power conference presidents and administrators obtained by Yahoo Sports, and it could force the NCAA to file for bankruptcy. A court loss would also strike down existing restrictions on future NIL and revenue sharing.
“So essentially, if we win, there will be a completely free market in NIL, including broadcast fees,” Kessler said.
A settlement would allow the NCAA to get further input on damages, a revenue-sharing payment structure, and some safeguards against other legal battles. Settlement of the House case would resolve Hubbard v. NCAA and Carter v. NCAA, two other high-profile antitrust cases in which Mr. Berman and Mr. Kessler represent plaintiffs in the Northern District of California. additional antitrust lawsuits would be blocked. According to a person briefed on the settlement negotiations. This is considered an important aspect of the settlement terms for the NCAA, which has faced an onslaught of legal issues in recent years.
This is a developing story. This will continue in the future.
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(Photo: Mitchell Leighton/Getty Images)
