It happened. The NCAA has introduced a framework to allow collegiate student athletes to profit off publicity rights.

The report came from the NCAA’s Federal and State Legislation Working Group. The NCAA currently prohibits student athletes profiting off their name, image, or likeness (NIL) rights while in college (a prohibition unique to athletes compared to, for example, student journalists or musicians). But now, the NCAA is considering NIL rights reform after legal battles, changing public opinion, and upticks in high profile basketball prospects foregoing college to pursue other developmental opportunities. The NCAA’s changes would go into effect for the 2021–22 academic year.

“I don’t want to beat them over the head too much, because this is monumental progress,” said Congressman Mark Walker (R-NC), who introduced the Student-Athlete Equity Act in 2019. “This kind of evolution has been needed … we have needed to evolve for many years and this is an important step,” said Laird Veatch, athletic director at the University of Memphis, who told ESPN Radio’s Memphis affiliate the proposals reflect the “dramatic shift in overall philosophy and approach in college athletics.” Daniel Lust, sports attorney with Goldberg Segalla in New York, agrees, writing “college sports would never be the same again.”

But others observed the NCAA doesn’t fully address the issue. “They’ve had months to come with ‘recommendations’ for how NIL will work … and you start asking the most obvious questions in the world and they have no answers,” said Gary Parrish, CBS Sports college basketball columnist, who attended the NCAA’s conference call unveiling the proposal.

“Many, many, many questions need to be answered,” said Veatch.

Among the proposals, college athletes could hire agents and sign endorsement deals with third parties and not lose their NCAA eligibility. These deals include autograph sessions, athletic camps, spokesperson roles for businesses such as restaurants and car dealerships, and social media influencer opportunities.

There are limitations. The report recommends barring schools’ logos or brands in athlete endorsement deals, encourages athletes not promote certain products like sports gambling or alcohol, and limit endorsements with shoe and apparel companies. That limitation surprised few, considering shoe companies’ role in recent federal investigations into college basketball recruiting, and to protect existing contracts with universities (for example, student athletes could not endorse one brand of sneakers while enrolled at a school with an existing contractual relationship with another sneaker company).

The NCAA, member schools, and athletic conferences themselves will not be permitted to pay athletes for NIL (nor for their labor, the proposal does not give college athletes employee status or a right to unionize). “Third-party compensation for NIL is also not compensation for the underlying labor of playing a sport,” noted Michael McCann, legal analyst for Sports Illustrated and director of the Sports and Entertainment Law Institute at the University of New Hampshire Franklin Pierce School of Law.

Another challenge is regulating university boosters, a long-standing source of NCAA infraction cases. While boosters likely wouldn’t be prevented from striking deals with athletes, the NCAA plans to oversee athlete/booster deals and require disclosing deal terms to a clearinghouse to prevent “pay to play” and ensure “fair market value” rather than an unrestricted free market.

“This is probably one of the most important points that we still have to iron out,” said Val Ackerman, commissioner of the Big East Conference. “The work ahead will be to figure out how to regulate booster involvement, particularly in pre-enrollment. What we don’t want is boosters being part of the recruiting pitches.”

Mike DeCourcy, college basketball columnist at Sporting News, similarly said, “I don’t want to see players get bought, I want to see players get paid.”

The proposals don’t allow for athletes to profit off their likeness in broadcasts or rebroadcasts of games, nor create frameworks for group licensing, so NCAA video games are unlikely to return. The NCAA claimed group licensing is “unworkable” since college players don’t have unions or bargaining units. Darren Heitner, founder of Heitner Legal in Fort Lauderdale and author of “How to Play the Game: What Every Sports Attorney Needs to Know,” wrote the NCAA is “essentially saying it does not want group licensing because it believes the door will then be opened for college athletes to classify themselves as employees thereby making them entitled [to] receive wages and benefits and shedding the NCAA’s veil of amateurism.” Group licensing for college athletes is being explored by professional sports players associations and with the nonprofit National College Players Association (NCPA) advocacy group.

Due to the NCAA’s current NIL prohibition, 30 states began drafting laws to specifically allow athletes to profit off personality rights. California was first to propose statutory protections in 2019, but Florida’s bill may be first to go in effect (July 1, 2021, if signed by the governor). California State Senator Nancy Skinner called the NCAA proposals “a step in the right direction.” Florida State Representative Chip LaMarca criticized the NCAA as “protecting their pockets … all we continue to hear are excuses from this multi-billion dollar not-for-profit.”

The NCAA will likely continue to lobby Congress to preempt NIL state laws with a federal right of publicity statute. “It’s clear we need Congress’ help in all of this,” NCAA President Mark Emmert told reporters. A Congressional group led by Senators Chris Murphy (D-CT) and Mitt Romney (R-UT) are analyzing reform for student-athlete NIL rights. Murphy called the NCAA’s framework for endorsements “totally impractical” and coauthored a response letter to Emmert urging the NCAA to go further in its proposals. Rep. Donna Shalala (D-FL), a former university president, called the proposals “a PR document.” Rep. Walker cautioned the NCAA from using its proposals as a “bait-and-switch” to restrict athletes rights.

The NCAA also will likely ask Congress for “an antitrust exemption as a safe harbor from litigation that would likely arise as a result of its limited approval of student-athlete compensation,” noted Grant Petrosyan, antitrust attorney at Constantine Cannon in New York. With the NCAA losing its most recent appeal of an antitrust case on capping athlete compensation at scholarship value, an antitrust exemption is “not a good idea … based on the pure lobbying power of the NCAA,” according to Marc Edelman, professor of Law at the Zicklin School of Business at Baruch College.

The NCAA proposals are undoubtedly the biggest step it has ever taken in modernizing its amateurism rules to account for today’s economic opportunity of NIL rights to student-athletes. Yet, its proposals keep the NCAA on a legal collision course with state law. The evolution of NCAA rules and federal and state laws on student-athlete compensation is still far from over.

Peter Colin is a technical client manager at Thomson Reuters. The views expressed are entirely those of the author and not Thomson Reuters

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