NOTE: The law surrounding NIL is still developing. The information in this article is accurate as of February 2023.
When the Supreme Court announced its decision regarding whether college athletes should be compensated for use of their name, image and likeness, one quote rang clear: “The NCAA is not above the law.”
This decision ended a decades-long battle between athletes, universities, conferences and ultimately, the NCAA as student athletes argued they should be compensated for the use of their name, image and likeness, or NIL. Student athletes now have significantly more agency when it comes to their own athletic careers, while the NCAA and athletic programs have less of a hold than they did before.
It’s a new age for college athletics, and NIL law and policy is a concept largely shrouded in the unknown. It’s been just about two years since the court decision. The SPLC is giving answers to your need-to-know questions.
Where did NIL policy come from?
In July 2021, the U.S. Supreme Court unanimously ruled the NCAA could not prohibit student athletes from profiting off education-related payments. This in turn forced the NCAA to amend its policy “allowing NCAA student-athletes the opportunity to benefit from their NIL without jeopardizing their NCAA eligibility (141 S. Ct. 2141).”
The NCAA v. Alston case started in 2014 when a group of Division 1 athletes, under the name “Alston,” filed multiple antitrust complaints against the organizing sports body. The students said the NCAA was violating section 1 of the Sherman Antitrust Act (15 U.S.C. §§ 1-38), an 1890 federal law regulating interstate commerce and allowing the government to dissolve trusts and break up monopolies. The Northern District of California, however, did not decide whether that was true in 2019. It did decide to give a permanent injunction, a court order telling a party to do or to not do something, saying the NCAA needed to make their rules less restrictive regarding financial compensation.
The NCAA appealed this decision to the U.S. Court of Appeals for the 9th Circuit to which it affirmed the prior court’s decision and declared the NCAA violated the Sherman Act in 2020. Unhappy with the result, the NCAA appealed again to the U.S. Supreme Court and saw that same decision get upheld, but this time it became controlling law nationwide.
“Everyone agrees that the NCAA can require student athletes to be enrolled students in good standing. But the NCAA’s business model of using unpaid student athletes to generate billions of dollars in revenue for the colleges raises serious questions under the antitrust laws. In particular, it is highly questionable whether the NCAA and its member colleges can justify not paying student athletes a fair share of the revenues on the circular theory that the defining characteristic of college sports is that the colleges do not pay student athletes. And if that asserted justification is unavailing, it is not clear how the NCAA can legally defend its remaining compensation rules,” Justice Brett Kavanaugh said in his concurring opinion (141 S. Ct. 2141 at 2168).
Student athletes can now receive education-related benefits that rise above the cost of attendance. Endorsements, autographs, apparel, appearances, businesses and much more are all things student athletes can profit off of that they could not previously.
What does implementation of NIL look like?
The NCAA still does not allow universities to directly pay players to play for them. However, the NCAA allows schools and staff to assist NIL entities with fundraising, such as providing an autographed football or making an appearance at an event, but they cannot make cash deposits to those organizations nor can they have an ownership stake or be employed by one. Schools can inform students about NIL opportunities and create a “marketplace” provider to match student athletes with deals.
On many major university campuses, NIL collectives are offering athletes deals — sometimes paying out several million dollars to top athletes. These organizations are independent of the university and typically funded by boosters and fans. They pool huge amounts of money to dish out to current student athletes — and sometimes prospects— through deals where students could in exchange make appearances, do promotions and other similar activities.
What’s the deal with states passing NIL laws?
Per the NCAA’s current policy, athletes and institutions must follow what their state laws establish regarding NIL. If there is no law enacted, the university is responsible for establishing their own guidelines.
States are passing laws to govern contracts and place certain provisions on universities and athletes. Some examples may include allowing athletes to hire agents, requiring athletes to disclose their agreements to their colleges or prohibiting endorsements of morally questionable industries like tobacco, alcohol, gambling, etc.
Check out whether your state has a NIL law yet and what the details are with the SPLC’s State-by-state NIL legislation guide.
Can I request public records regarding NIL?
Sports student journalists will need to monitor legislative sessions in their states to report on what is and isn’t included in this new legislation. Many state legislatures are passing bills with clauses protecting universities publicly disclosing little to any information.
Journalists across the country are testing the laws and universities in their states to see what NIL information is available to request through public records. In an expansive ESPN investigation, reporters Paula Lavinge and Dan Murphy said they found that there is no uniform rule about transparent disclosures of NIL deals.
“The only way to get any kind of picture of what’s happening in the marketplace is by cobbling together incomplete and unverifiable figures from public statements from athletes, the companies they endorse, and others,” the article reads.
In their requests to 23 universities across the country, they saw denials citing FERPA or saying there’s no records reflecting the request, half-fulfilled requests with partial information and information given that’s loosely related to what they requested. However, some colleges were definitely better than others as the University of Maryland gave more in-depth information, including a spreadsheet of individual transactions along with the business’s name, the paid-for activity, monetary amount, date and sport.
Universities and athletic programs are gearing their efforts away from transparency for a variety of reasons with the most prominent being “the competitive edge.” As state laws are being passed around the country, celebrity coaches are ending up in the statehouse, asking for certain things to be included in legislation. For Kentucky basketball coach John Calipari, he testified asking for certain records to be kept private — and they now are. The law reads:
“For the purposes of the Kentucky Open Records Act, KRS 61.870 to 61.884, a 15 NIL agreement submitted pursuant to subsection (2) of this Section to a public 16 postsecondary institution and the information obtained from the agreement shall 17 be considered as containing information of a personal nature where the public 18 disclosure thereof would constitute a clearly unwarranted invasion of personal 19 privacy under KRS 61.878 and not subject to disclosure.”
In Louisiana, the law looks similar:
“Any document disclosed by the intercollegiate athlete to the postsecondary education institution that references the terms and conditions of the athlete’s contract for compensation shall be confidential and not subject to inspection, examination, copying, or reproduction pursuant to the Public Records Law.”
The ESPN investigation notes the NCAA has struggled to maintain power, and it has even less of an ability to do so now. The reporters note that the NCAA was denied NIL documents at the University of Oregon among other instances elsewhere.
There is a conversation being had about what and who oversees and keeps these deals in check. As the NCAA loses its own grip, journalists need to be extra vigilant to understand passed and pending legislation and report the potential effects to their communities.
Are high school students included?
The NCAA will not penalize high school athletes if they decide to cash in on autographs or endorsements. However, students may run into trouble and risk their high school eligibility if they violate their high school’s or high sports association’s rules.
The Alabama High School Athletic Association 2022-23 handbook prohibits it, saying, “Only amateurs are eligible. An amateur is one who does not use his/her knowledge of athletics or athletic skill for gain” and provides extra clarification on possible scenarios. On the other hand, the Massachusetts Interscholastic Athletic Association handbook says, “A student-athlete may profit off the use of their own name, image, and likeness (NIL), and be represented by an attorney or sports agent, subject to their compliance with this policy.”
As states pass their own laws governing NIL, some legislators are considering clauses allowing high school athletes to be included while others are drawing the line at higher education. In Texas, the 2021 state law prohibits any NIL arrangements prior to a student’s university enrollment.
However, high school athletes not being specifically called out in state law does not mean they are left in the cold. Overseeing athletic organizations are establishing their own NIL policies, and several state athletic organizations allow high school student athletes to profit off their NIL.
Learn more about whether your state has NIL law and the details through the SPLC’s State-by-state NIL legislation guide.
High school student athletes and student journalists will need to read through their state’s laws, if one has been passed and enacted, to check for such language. If not, you will need to check on your state athletic association’s or conference’s rules. Lastly, look to see if the high school’s handbook has any policies.
What about international students?
Something to look out for at your university is whether international student athletes are receiving NIL dollars. These students are likely permitted to be in the country because they have a visa, and an NIL deal may violate the working agreements of their stay. The NCAA says there are about 21,000 international student athletes competing in NCAA division schools.
There are not many solid answers from the U.S. Department of Homeland Security or elsewhere for these students as of yet. It is definitely a question for student journalists to keep an eye on.
What comes next?
Many questions are still left unanswered as this new precedent is just under two years old. The NCAA said NIL may cause “potential issues, such as claims for contractual nonperformance, Title IX issues and employment issues.” All of which it says should be dealt with by Title IX and general counsel staff.
The NCAA does not hold the power it once had, meaning new developments may be more likely out of the courtroom than an NCAA boardroom.
Justice Kavanuagh brings up some of those questions in his concurring opinion:
“If it turns out that some or all of the NCAA’s remaining compensation rules violate the antitrust laws, some difficult policy and practical questions would undoubtedly ensue. Among them: How would paying greater compensation to student athletes affect non-revenue-raising sports? Could student athletes in some sports but not others receive compensation? How would any compensation regime comply with Title IX? If paying student athletes requires something like a salary cap in some sports in order to preserve competitive balance, how would that cap be administered? And given that there are now about 180,000 Division I student athletes, what is a financially sustainable way of fairly compensating some or all of those student athletes? Of course, those difficult questions could be resolved in ways other than litigation (141 S. Ct. 2141 at 2168).”
The majority opinion mirrors this sentiment and repeats what the Ninth Circuit said. It was not the Court’s task to completely sort out the issue of amateurism and compensation in collegiate athletics; they were tasked with just deciding whether the initial court decision was soundly and correctly interpreting antitrust law.