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EPISODE 3: THE “DISFUNCTIONAL” HOUSE SETTLEMENT TALKS!
Now explaining the “settlement” discussions in the House case to us average Joes and Janes. Keep in mind, much of what we are reading in the media is coming from “sources” and "people familiar with” and no deal is imminent.
House is a (federal) lawsuit, which means there is a plaintiff (or in this case 2 classes of roughly 14,000 similarly situated plaintiffs), and defendants– the NCAA and the “power” conferences. Thus, any settlement can only be by written agreement entered into by, and theoretically only involving, plaintiffs and defendants. This fact means that the NCAA is potentially open to further antitrust and other lawsuits over NIL back-pay and other related claims, such as employment status as an example, by any individual athlete or entity not a party to a settlement agreement. The NCAA surely wants to avoid this scenario with any settlement to the fullest extent possible.
The alleged settlement calls for the NCAA to pay out supposedly $3B over ten years to the plaintiffs in the class with claims for back pay, which does not resolve future pay issues. In this regard, the NCAA, and apparently its member institutions would also agree to a revenue share model, which may include a cap on annual revenue sharing number based on some % formula of revenue. This cap creates yet another potential antitrust problem for the NCAA, basically in the form of collusion (an antitrust violation) to put a limit on how much the athletes can earn in this NIL model going forward. Further, might the revenue sharing be discriminatory and violate Title IX?
The NCAA, therefore, needs some further litigation protection in the form of: (1)Congress creating an antitrust exemption for the NCAA and/or (2) Congress creating a special status designation for all athletes where they can collectively bargain for a revenue sharing pay structure even if not deemed employees and if not unionized.
Far from over, clear as mud, and you’re welcome! 😊
ABOUT THE AUTHORS:
NILegally Speaking™ is written by PowerNIL/Ken Feinberg, attorney, in collaboration with other expert attorneys focused on employment, labor, contract, and intellectual property law.
ken@powernil.com www.powernil.com