House v. NCAA Settlement On Hold As Judge Sends Attorneys “Back To The Drawing Board”

The landmark settlement in the NCAA v. House antitrust case has been put on pause after a Federal Judge called into question how the deal would limit third-party name, image and likeness (NIL) payments from boosters.

Judge Claudia Wilken advised the settlement attorneys to “go back to the drawing board” while expressing concern with several parts of the deal during a hearing on Thursday.

In May, the NCAA and the Power Conferences agreed to a 10-year settlement that would pay $2.7 billion in damages to athletes along with terms of a revenue-sharing agreement that would allow schools to share $20-23 million annually in revenue to athletes.

Judge Wilken has put the case on hold, declining to grant preliminary approval.

“I’m concerned about the third-party NIL restrictions,” Wilken said. “I’m concerned (the settlement) will limit those opportunities for people moving forward.”

Among Wilken’s primary concerns was a clause that would require any money boosters provide to athletes to be for a “valid business purpose” and eliminate pay-for-play payments that have become common in NIL collectives.

Wilken asked NCAA attorney Rakesh Kilaru if the settlement would end up with the organization paying athletes to pay, but Kilaru said that pay-for-play will be against the rules.

“For us it’s an essential part of the deal,” Kilaru said.

Over the last few years, since the introduction of NIL, booster collectives have provided payments to athletes that are, on paper, for NIL usage, but in reality have essentially served as player salaries. The deal is designed to take this away.

“What are we going to do with this?” Wilken asked. “I found that taking things away from people is usually not too popular.

“The schools don’t have to pay those benefits, and the schools may or may not be able to pay those benefits, but clearly, the collectives or the boosters or the third parties do have those resources and are willing to pay them, apparently.

“I think we’ve got problems with this, and I don’t have an idea of how to fix them. So I think I’m just gonna have to throw this back on you all to see if you can come up with something better.”

Both sides of the settlement agreed to confer, consider Wilken’s concerns and make a supplemental submission on Sept. 26.

Jeffrey Kessler, the lead attorney on the House side, said a trial is possible if Wilken is not satisfied and an agreement cannot be reached.

“If we’re going to solve these issues and go forward, that’s great,” Kessler said. “And if not, then we want a trial date.”

Kilaru added that after hearing what Wilken had to say, he’s not sure a deal can be made.

The NCAA released a statement on Thursday night, acknowledging the manner of questions brought forward by Wilken aren’t out of the ordinary in class action settlements:

“The settlement agreement the NCAA and autonomy conferences submitted to the court was the product of hard-fought negotiations that would bring stability and sustainability to college sports … That continues to be our goal and the NCAA and autonomy conferences will carefully consider the court’s questions, which are not uncommon in the context of class action settlements.”

If Wilken grants preliminary approval later this month, settlement parties can begin notifying class members, namely athletes eligible for damages payments and current student-athletes eligible for optional revenue-sharing. A final approval hearing would then be scheduled for early next year. If it’s approved in that final hearing, settlement terms go into effect immediately with the revenue-sharing agreement beginning in July 2025.

In This Story

36
Leave a Reply

Subscribe
Notify of

36 Comments
newest
oldest most voted
Inline Feedbacks
View all comments
Sapiens Ursus
1 month ago

I woukd like to point is it’s well documented top programs would often covertly pay athletes and their families with “bag men” not officially associated with the school as part of recruiting for football (and probably basketball too at least)…

I don’t think there is an outcome that doesn’t break something. Can’t polish a turd

joannietheswimmer
1 month ago

What a shit show

Swim dad
1 month ago

Does this settlement have anything to do with the upcoming roster cuts next season or is that a totally separate issue? I still don’t fully understand all of this. And if roster cuts do have something to do with this why isn’t the judge commenting on that or have concern about the athletes who will no longer have a home next season? Kids no longer being even to participate as college athletes because of everyone’s greed is the biggest travesty of this whole situation in my opinion, particularly if Grant House (who finished his college career at age 26 after an ungodly term as a collegiate athlete) is behind this.

Dan
Reply to  Swim dad
1 month ago

Roster limits was 1 part of this settlement but might not been part of the areas the judge had issues with.

Swim3057
Reply to  Swim dad
1 month ago

Judge Wilken’s issues were regarding NIL, 3rd party collectives and enforcement of NIL issues. The rest of the proposed settlement passed muster with the judge (including roster size and no scholarship limits for those who chose to fund it). If they are able to come back on 9/28 addressing the issues the Judge raised than she is likely to sign off on the settlement and roster limits would come into play for the 25-26 school year. If the NCAA continues to play hard ball with the NIL issue then the plaintiffs will go trial early next year and it could be years until there is resolution as the trial and ultimate appeals would drag out the process.

Admin
Reply to  Swim dad
1 month ago

The two things are connected.

The judge’s purview is not the emotions of college swimmers. The judge’s purview is the law, which doesn’t really consider things like that. She could say “wow this is really going to suck for other college athletes” but it wouldn’t really mean anything. The lawyers don’t care.

IU Swammer
1 month ago

This shows the NCAA still refuses to accept that they are subject to the same laws as everyone else. They’ve been operating on the assumption that there’s some special exceptions for college athletics, despite losing this argument over and over for the last 20 years.

Also, saying the judge sent them “back to the drawing board” is an overstatement. The NCAA insisted on having this one piece in the settlement that allows them to continue violating the law. The Plaintiffs acquiesced, likely knowing this would be a nonstarter with the Court. Now, the Plaintiffs have zero incentive to give up anything they have gotten in the negotiations to date, and the NCAA knows they cannot get provision they insisted… Read more »

Last edited 1 month ago by IU Swammer
Grant House anti-fan club
1 month ago

It’s pretty telling that the House side was willing to deprive future athletes of a pay-to-play deal in order to secure their payout. Good on Wilken for reading the fine print.

IU Swammer
Reply to  Grant House anti-fan club
1 month ago

I don’t think that’s a fair reading. The NCAA is clearly saying it really, really wants to ban pay-to-play. Plaintiffs likely got a lot of concessions by agreeing to that. As soon as the Judge said that banning pay-to-play isn’t going to work, the Plaintiffs’ attorney asked for a trial date. The Plaintiffs know they are going to win at trial, and that win would devastate the NCAA. So by asking for a trial date, the Plaintiffs’ attorney was telling the NCAA “we have you over a barrel and we’re not using lube this time” but in polite lawyer-speak.

Grant House anti-fan club
Reply to  IU Swammer
1 month ago

I personally don’t think we should normalize nonconsensual procreation, but regardless that doesn’t change the fact that the Plaintiffs were willing to block pay-for-play from future athletes.

If “concessions” would have been establishing a salary cap and a payout to former athletes (which the Plaintiffs would have gotten a cut of), it sounds like you’re saying is that the Plaintiffs were justified in taking away others’ opportunities to get a larger payout, which is maybe more nuanced but still not a decision they should get to make.

In that context, by asking for a trial date, they’re more just saying “We’ll either get our money now, or we’ll get it later, and if future athletes are better off… Read more »

Last edited 1 month ago by Grant House anti-fan club
Sean
1 month ago

Separate the football and basketball teams from the university and make them their own revenue center. (Professional athletes) Lease the stadium and mascot to this new entity for 100 years at $1 per year. Shift all operating costs and revenues related to football and basketball to this new entity. Have the university charge back the cost of education if these athletes would like to get a college degree. (not a requirement for being on this professional team) The colleges can then take a look at non-revenue sports and make the determination, without the current serious title IX and NIL implications, if they are value added. I would hope they would be value added. Perhaps they could come up with regional… Read more »

please and thank you
Reply to  Sean
1 month ago

100% agree.
I’m just not sure how we get from current mess to that.
A few not entirely well thought out thoughts.
In my mind, these universities should all be operating more like Division III.
I do not like that sports teams are often only considered successful if they are revenue generating.
Maybe scholarships are moved out of athletic department budgets and move into a more holistic applicant budget.
Colleges should be looking at sports as a way to make a better more full person, just like any club or activity.

SwimCoachDad
1 month ago

Now there is just one more thing to take care of; get the NCAA to back down from the minimum number of varsity sports from 7 men/7 women or 6 men / 8 women to 0 and 0 so they can just do the absolute minimum to offset the football program’s 100 full scholarships with women’s scholarships to be in compliance of Title IX. Then the colleges/Athletic Directors will be happy. The Power 4 conferences will all have Football, Men’s & Women’s basketball, women’s rowing, and a couple other women’s sports and a bunch of club teams. And what is the difference if a booster pays a player to play for his/her favorite team outright or pays the player to… Read more »

KSW
1 month ago

so when do I get my $18.61 payment?

About James Sutherland

James Sutherland

James swam five years at Laurentian University in Sudbury, Ontario, specializing in the 200 free, back and IM. He finished up his collegiate swimming career in 2018, graduating with a bachelor's degree in economics. In 2019 he completed his graduate degree in sports journalism. Prior to going to Laurentian, James swam …

Read More »