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Volume 23 No. 8
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Name, image, likeness battle puts heat on NCAA

California law would allow college athletes to seek moneymaking activities, but NCAA working group seeks alternatives of its own.

The NCAA last May publicly named a high-level working group of presidents, commissioners and athletic directors to study one of its most challenging questions — how the name, image and likeness issue fits within its amateurism model.

Just three months earlier, a bill to make it easier for student athletes to monetize their name, image and likeness was introduced in California with far less notice. That bill, known as the “Fair Pay to Play Act,” quickly garnered national attention and became a state law last week, going into effect Jan. 1, 2023. The bill, which received prominent national mainstream media coverage, states that neither schools nor the NCAA will be able to legally punish athletes in California for making money on endorsements, autograph signings or similar moneymaking activities.

With the legislation, the pressure and spotlight quickly reverted to the NCAA’s NIL working group in anticipation of how it would create new ways for its athletes to benefit from their name. The NCAA has made it clear, however, that there are limits to how much it will change and there’s no indication that the governing body is relinquishing its grip on amateurism.

It’s too soon to know how much the new law will force the working group to seek more aggressive changes to its current policy, but multiple sources said it has solicited ideas from outside of the 19-person committee to consider.  Ohio State AD Gene Smith and Big East Commissioner Val Ackerman co-chair the group. An early progress report will be presented to the NCAA’s board of governors on Oct. 29 in Indianapolis, but no long term solutions are expected.

The stakes look a lot different now than they did last May.

“The states are not going to accept incremental progress,” said Jeffrey Kessler, a sports labor attorney for Winston & Strawn, who filed an antitrust lawsuit against the NCAA in 2014. “They’re looking for meaningful reform.”

USC is one of the schools that would fall under California’s new “Fair Pay to Play Act.”
Photo: getty images
USC is one of the schools that would fall under California’s new “Fair Pay to Play Act.”
Photo: getty images
USC is one of the schools that would fall under California’s new “Fair Pay to Play Act.”
Photo: getty images

The battle lines drawn last week came in predictable places — with the NCAA on one side and on the other, athlete advocates praising the new California law — which sets the stage for the NIL working group to be the X factor in an uncertain financial future.

One alternative that has been debated for years is the concept of group licensing that would share revenue among scholarship athletes. Charles Grantham, the former NBA union chief, wrote an opinion piece in the New York Times in 1990 suggesting that it was time to bring the revenue-share model to college athletics, and it remains an often-discussed option in collegiate circles that could work.

Grantham, now director of Seton Hall’s center for sport management, said a group arrangement could succeed in college just like it has in the NBA, with a percentage of revenue earned deposited into a trust fund and invested. 

Players could access the money when their eligibility expires, providing them an incentive to stay in school because the longer they stay, the more money they get.

“This is just one big negotiation, and it is just the beginning,” Grantham said.

It’s far too early to predict how all of this will reshape college athletics, industry insiders say, but they agree that status quo isn’t an option. The methodical progress made by the NCAA to grant athletes more benefits — cost-of-attendance stipends, extended health insurance, four-year scholarships — didn’t satisfy lawmakers in California or several other states.

U.S. Representative Anthony Gonzalez from Ohio has said he’ll propose federal legislation that essentially takes California’s law and makes it national.

At last count, a dozen other states had a similar bill in the pipeline or under consideration, prompting speculation that the NCAA’s coveted amateurism model, which has survived a century of attacks, might not survive this one. 

“It may be that we finally reached the breaking point with the current model,” said Gabe Feldman, director of Tulane’s sports law program. “But it may not be. The one constant in the last several decades is the deference that the courts give to NCAA amateurism rules. And even with the current, recent losses in California, those have not led to the end of the amateurism model. … The NCAA model’s been pretty durable.’’

Len DeLuca, who has spent four decades in college sports on the network side at CBS and ESPN, said the NCAA has a choice in how it responds.

“You can fight and fight and fight and incrementally change as the law changes,” said DeLuca, an adjunct professor at New York University. “Or you can say that we have this incredible industry and we’re going to fund an option that gives back to the student athlete and gives them the right to have intelligent representation.”

The NCAA has reacted by saying it will sue the state of California to rescind the new law because it interferes with interstate commerce, which is why NCAA President Mark Emmert called the new law unconstitutional.

The NCAA’s record in court hasn’t been so successful in recent years, but those losses haven’t resulted in much change, other than the introduction of cost-of-attendance stipends.

Kessler’s case, an attempt to redefine the value of a grant-in-aid, is ongoing and will likely take another year to work through appeals, he said. That’s the case where U.S. District Judge Claudia Wilken ruled that the major conferences are violating antitrust laws by capping the value of a scholarship and authorized conferences to establish their own policies for a scholarship.

In those cases, plaintiffs had to prove the NCAA’s existing policies were wrong. The legal tables are turned with the new California law.

“Now the burden is on the NCAA,” Kessler said. “They will have to convince a court to stop a law. … Listen, things are changing. The train has left the station. It’s just a matter of how long it takes to complete the journey.”