That’s right, a federal judge has accepted the huge class-action lawsuit settlement known as House v. NCAA. This means that college sports can start a new era.
Colleges and universities in the NCAA’s top level will be able to pay athletes directly for the first time this fall. A pay cap of $20.5 million per school will limit the amount that can be paid. Also, past college athletes who were not allowed to work while they were in school will get more than $2 billion.
In her Friday order, U.S. District Judge Claudia Wilken said, “Despite some compromises, the settlement agreement will still result in extraordinary relief for members of the settlement classes.”
In the past, the NCAA and schools decided to give $2.75 billion to college athletes who played before 2021. That’s when the NCAA changed its rules so players could sign NIL agreements to make money from their name, picture, and likeness. Men’s football and basketball players will get paid the most. Well-known athletes who played at big schools could make as much as five or six figures.
Chris Gasper, a sports writer for the Boston Globe, talks to Charlie Baker, president of the NCAA and former governor of Massachusetts, at the Globe Summit 2023.
The interview shows the NCAA president talking about why he backs the NIL deal for college players.
With the deal in place, schools will be able to pay players directly from now on. The schools will choose which players to pay and how much. The athletes who play the sports that bring in the most money for schools are likely to get the most money. These sports are football, men’s and women’s basketball.
The deal also limits the amount of money that can be made. Player pay for all sports at each school will be limited by a cap of $20.5 million at first, and that cap could go up to $33 million in 2035. New this year are roster limits, which take the place of the old scholarship limits for each event. Schools can give out as many scholarships as they want, but there are limits on how many teams can play.
According to court documents filed by lawyers negotiating the settlement, about half of the NCAA’s 365 Division I schools are likely to adopt the new framework. This is either because their conferences—the SEC, ACC, Big Ten, Big 12, and PAC-12—are named as defendants and must follow the settlement’s terms, or because they expect to agree to them. Some schools, mostly those in the lower football league and those that don’t have any football teams at all, will choose not to be part of the settlement. Instead, they will continue to only give athletes scholarships and help with other school costs.
Name, picture, and description
Since 2021, when the NCAA first let players get paid for the rights to their name, image, and likeness, NIL payments have acted like a pay-to-play scheme. Star players, like Duke basketball star Cooper Flagg, have made a lot of money from these deals.
A key part of the settlement also goes after those huge NIL deals by setting up a third-party database to check licensing agreements for “fair market value.”
Some people in college sports have said that idea is bad. A professor at Boise State University named Sam Ehrlich who follows lawsuits in college sports said that it is also likely to face legal problems.
“There’s going to be significant questions moving forward as to what kind of powers that clearinghouse has and whether the clearinghouse is even legal,” Ehrlich said last month.
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