The pay-for-play chaos in major college football is coming to a head this week on two fronts.
On one front, the major conferences will decide this week whether to approve a settlement in the House vs. NCAA anti-trust lawsuit. This is just one of the many anti-trust lawsuits the NCAA faces these days, but settling the House case could create the revenue-sharing framework that could protect the college football industry from further litigation.
The NCAA pretty much has to settle, because its longstanding argument that student-athletes are amateurs in a billion-dollar industry has been shot down in lawsuit after lawsuit after lawsuit.
College athletes in revenue-producing sports are getting paid now – and they will keep getting paid, perhaps within a revenue-sharing structure hammered out through the settlement of litigation.
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“We are optimistic that a transformative moment for college sports may be very close,†House plaintiff attorney Jeffrey Kessler told 247Sports.Â
Of course, colleges would have to figure out how to fund the revenue share with athletes. Among those monitoring the process is Jim Cavale, the founder and CEO of , which is building a players association at the college level.
“When a number like $2.7 billion gets thrown around in a settlement and a number like $20 million a year gets thrown around as the number that the school can directly share with the athletes, kids and parents are going to care, and they’re going to have a lot of questions,†Cavale told the Washington Post.
“They’re going to be asking the schools: Why $20 million? Who gets what? How much does football get? How much does each player get? What about Title IX? Scholarships?â€
The proposed $20 million revenue share would be burdensome for mid-tier programs. Athletic departments without huge NIL collectives would have to cut their budget to pay athletes.
“I don’t know where we’d get rid of the $20 million – at least overnight,†said Iowa State athletic director Jamie Pollard, who operates with a $100 million budget. “That’s the million-dollar question or the $20 million question for all of us.â€
While major college conferences wrestle with a potential litigation settlement. NIL spending continues willy nilly. The downside of that was underscored Georgia quarterback Jaden Rashada’s lawsuit against Florida coach Billy Napier and others for reneging on a $13.8 million NIL deal.
Rashada went to Arizona State instead, then transferred to Georgia after one injury-marred season. His lawsuit put a spotlight on just how sketchy this unregulated NIL business has been.
Napier was already on the hot seat at Florida and this lawsuit only makes things worse.
With any luck, all of this litigation will force the college football industry to finally gain structure that makes sense. But Tipsheet will be sad to the it lose some of its color as the sport’s slippery bag men lose their roles.
Here is what folks are writing about all of this:
Justin Williams, The Athletic: “All it does is lose. The most notable example is the NCAA v. Alston case in 2021, in which a historically divided Supreme Court ruled unanimously against the NCAA, voting 9-0 to uphold a lower-level court decision stating the NCAA cannot limit education-related payments to student-athletes due to federal antitrust principles. This decision came in the wake of O’Bannon v. NCAA, which cleared a path for universities to provide ‘cost of attendance’ stipends to student-athletes. Both cases sparked the NCAA to ultimately remove restrictions on college athletes collecting name, image and likeness (NIL) earnings in July 2021. The NCAA has long governed over — and clung to — an amateurism model of competition. But as college sports, football in particular, have grown wildly lucrative in terms of television dollars and other media rights, that model has been increasingly condemned. In the two years since Alston, a flurry of lawsuits and legal action have been mounted against the NCAA, serving as a backdrop to the memo NCAA president Charlie Baker released last month proposing the creation of a new subdivision within DI athletics that would allow the highest-resourced programs to directly compensate athletes through a trust fund and/or in-house NIL agreements. It was a shocking suggestion from the head of an organization that has fought so hard against that notion, but it reflects the stark reality college sports must reckon with. The NCAA represents roughly 1,100 member schools and half-a-million athletes across 90 sports in Divisions I, II and III. Alabama football has little in common with Carleton College, a private liberal arts school in Northfield, Minn., with an enrollment of roughly 2,000 students that is home to the NCAA 2023 DIII women’s cross country national champions.â€
Ross Dellenger, Yahoo! Sports: “If they reject a proposed (House lawsuit) settlement offer, officials from the NCAA and power conferences stand to face a catastrophic $20 billion in back damages as well as risking a bankruptcy filing, according to documents obtained by Yahoo Sports. The two-page document was circulated among power conference presidents and administrators on Tuesday as ACC leaders met at their annual spring meetings in Florida. It details terms of a potential settlement in the House, Hubbard and Carter antitrust cases, a trio of legal challenges brought against the NCAA and its five power conferences seeking back pay for various athlete compensation elements. The settlement, believed to be in the final stages of adoption, consists of three main concepts: billions in back damages; a new compensation model permitting schools to share as much as $22 million annually with athletes in a capped system; and an overhaul of the NCAA scholarship and roster structure. The document outlines settlement concepts in detail as well as particulars around the new compensation model. It also provides university leaders with new information on hot-button topics such as how a settlement protects the NCAA from future legal challenges, Title IX’s application and the enforcement of booster-led collectives in a ‘new infrastructure.’ Documents specify, perhaps for the first time in writing, the total amount in back damages owed to athletes for the use of their name, image and likeness (NIL) before the NCAA lifted NIL prohibitions in 2021. The amount is $2.776 billion.â€
Eric Prisbell, : “Industry leaders face few attractive options in the face of a class-action lawsuit that sources say poses an existential threat to the NCAA. If the NCAA chooses to take the case to trial in January, it could face a possible $4.2 billion damages bill. Still, some pushback has existed among stakeholders, in part, because they do not see a clear way the settlement provides protection from further lawsuits from future college athletes. The settlement is expected to include an annual mechanism allowing future college athletes to opt-out from or object to settlement terms. That element won’t necessarily protect the NCAA from future litigation. But it could make it more difficult for larger (and far more costly) class-action suits to take hold. On top of questions over protection from further litigation, many college leaders are grappling with how to budget appropriately in the new age of revenue sharing.”
Jesse Dougherty, Washington Post: “If the sides agree on a settlement in the near future, the process would be far from over. Judge Claudia Wilken would have to approve it. From there, it would still take months to iron out the finer points. And if a House settlement does establish revenue sharing — which would include money from television deals, ticket sales and sponsorships — it wouldn’t begin until the fall of 2025 . . . Those uncertainties include how revenue would be distributed school by school; how Title IX applies; how donor-funded NIL collectives would fit into this new model; how much antitrust protection the NCAA, schools and Congress would actually have after a settlement; and the still-burning question of whether athletes will become employees at some point down the line. House has nothing to do with employment. But between federal court and the National Labor Relations Board, multiple cases could make athletes employees, meaning athletes could be eligible for minimum wage, additional employee benefits and workers’ compensation in the future.â€
Brandon Marcello, 247 : “Revenue sharing and back payments could cripple smaller athletic departments, though the House plaintiff attorneys are not targeting Group of Five conferences in the lawsuit. Most departments are ill-equipped to pay athletes as much as $20 million annually. More than 50% of Group of Five schools earn less than $40 million annually in revenue. The Power Five conferences (then including the Pac-12) combined for more than $3.3 billion in revenue for the 2022 fiscal year, according to federal tax records. Ohio State earned $251.6 million in revenue last year to lead all Power Five schools.”
John Talty, : “Georgia quarterback Jaden Rashada has filed a lawsuit against Florida coach Billy Napier, top Gators booster Hugh Hathcock and former football staffer Marcus Castro-Walker over a failed name, image and likeness deal that would have paid the quarterback $13.85 million, according to a suit filed in federal court on Tuesday. The bombshell lawsuit, which features the unprecedented action of an active SEC quarterback suing a sitting rival head coach, is the most notable NIL-related lawsuit to date. In many ways, Rashada became the face of the chaotic nature of early NIL that was full of big promises with little oversight on the heels of his Florida deal falling apart. The complaint, filed in the Pensacola Division of the U.S. District Court for the Northern District of Florida, details a number of counts alleging Napier, Hathcock and others fraudulently induced Rashada, then a highly regarded high school quarterback prospect, to attend Florida with no intention of following through on their financial promises.”
Israel Daramola, The Defector: “Rashada had initially pledged to attend Miami after the school promised him $9.5 million in NIL money. The lawsuit claims that Hathcock, owner of Velocity Automotive, along with Florida employees nevertheless continued in their pursuit of the highly rated prospect. The lawsuit alleges that Hathcock and Castro-Walker offered him a $13.85 million deal, with $5.35 million and a $500,000 signing bonus coming from Velocity Automotive, and the rest coming from Gator Guard, the NIL collective that Hathcock started for the university. There was also a job for Rashada's father promised in the deal. These terms ultimately changed due to Hathcock's plans to sell Velocity Automotive. Instead, he and Castro-Walker proposed money coming directly from Hathcock himself, as well as Florida's other NIL collective, the Gator Collective. According to the lawsuit, the Gator Collective CEO Eddie Rojas played into this alleged fraud, texting Rashada empty promises about the deal. The deal was signed on Nov. 10, 2022 with a $500,000 payment scheduled to come on Dec. 5. But instead of that $500,000, the Gator Collective sent Rashada a termination letter for the $13.85 million deal. The lawsuit claims that following this letter being sent, Napier and Castro-Walker went to great lengths to convince Rashada that the school planned to make good on their promise even without the contract, convincing Rashada and his representatives that Hathcock, ‘through the Gator Guard, would personally guarantee the $13.85 million himself.’â€
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“At this point in time, there's a real lack of clarity. I don't expect, if there is a settlement, any potential guidelines on how each athletic department distributes those monies. Who receives it? All student-athletes? Just revenue-generating sports? Is everybody the same? My guess is it's not. How do we figure that out?â€
Baylor athletic director Mack Rhoades told 247Sports.