May 16, 2022

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NCAA Clarifies Compensation Rules But Is Suppression Likely?

NCAA Clarifies Compensation Rules But Is Suppression Likely?

Eleven months after the NCAA lifted most of its restrictions on athletes who cash in on their fame, college sports leaders are trying to send a warning to schools and promoters they think have overstepped the bounds: There are still rules here and they will be enforced.

But in the wake of last year’s Supreme Court ruling against the NCAA in an antitrust case, is a crackdown on so-called group-broking deals in name, image, and likeness still likely — or even possible?

“I didn’t think (NCAA) would try at some point,” he said Maddie Salamon, sports attorney and former Duke lacrosse player. “This is why many lawyers are kind of giving cautious advice regarding what is and is not allowed. Especially when it comes to different combinations and deals.”

The board of directors of the first department of the National Universities Sports Authority approved on Monday Directives set by a group of college sports officialsand clarify the types of zero payments and enhanced engagement that should be considered recruiting for abuses.

“Specifically, directive is defined as supportive of any third-party entity that promotes an athletics program, and assists in recruiting or assisting in providing benefits to recruits, enrolled student athletes, or members of their families,” the NCAA statement said. “The definition could include ‘groups’ that are set up to direct name, image, and likeness deals to potential student-athletes or enrolled student-athletes who may be considering a transfer.”

The NCAA added a reminder: Recruitment rules prevent reinforcements from recruiting or providing benefits to potential clients.

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Steering is effective immediately. NCAA enforcement personnel have been instructed to seek out potential violations that may have occurred prior to May 9, 2022, but to “pursue only those actions that are clearly inconsistent with the published interim policy, including the most serious violations of enlistment or pay-for-performance athletics rules.”

The NCAA has neither changed its rules nor created new ones.

“I don’t think they even clarify the rules necessarily,” said attorney Darren Haitner, who helped draft the Florida NIL law. “My understanding is that this is just some of the individuals who formed a task force and decided after nearly 11 months that we wanted our rules to be enforced.”

The emergence of booster-funded groups prompted the Board of Directors in February to ask the DI Board to review Temporary NCAA Policy. Anxiety among many in college sports Payments from groups were made to high school recruits and college athletes hoping to transfer to a particular school.

“Some things look a lot like pay to play,” Salamon said. “There are rules in the books within the NCAA about reinforcements. The fact that the NCAA has been reluctant to enforce anything I think has encouraged a lot of people on this issue to be a little more clear.”

Last year, the NCAA lifted its longstanding ban on athletes who earn money from sponsorship and endorsement deals. However, what remained in place were three pillars of the NCAA amateur athlete model:

– Athletes cannot be paid just to play their sport;

– compensation cannot be used to attract an athlete to a particular school;

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Financial arrangements should contain some type of barter agreement under which the athlete is paid for services rendered, such as a social media post or appearance.

The NCAA did not prohibit enhancers from participating in NIL activity. However, without detailed NCAA rules and with NIL laws varying statewide across the country, schools and the association have been left struggling. To determine which activities are not permitted.

Some state laws also prohibit reinforcers from dealing with recruits, but there has been little appetite for enforcement of those laws.

If the NCAA starts targeting certain groups, it could lead to a new round of lawsuits against the association.

Mitt Winter, a sports attorney in Kansas City, Missouri, said the NCAA’s enforcement of these rules is not a clear antitrust violation.

“So the question is, under antitrust law, is the rule being enforced reasonable?” Winter said. “And in my reading of everything, the rule that’s going to be enforced is the rule that reinforcers and other third parties like teammates can’t pay athletes to stick to school.”

Heitner advises many groups and companies that have made nil deals with college athletes. He said he has emphasized to clients from the start to wait until athletes go to the school of their choice before participating.

“I don’t think it’s a collective issue,” he added. “I think it’s just about the NCAA saying, ‘Hey, we’ve always been in a situation where boosters can’t influence the decision making of athletes, especially high school athletes who haven’t gone to college yet. “

The best way for the NCAA to be looking forward is by implementing its own national sports law, said Gabe Feldman, director of sports law at Tulane.

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“I think this approach is probably safer and perhaps more equitable,” Feldman said. “Hindsight is 20/20, but what could be a better approach is to come up with clear rules earlier and start enforcing them so we don’t get to a situation where it might be unfair to start enforcing the rules.”

College and NCAA athletic conferences have been frequent targets of lawsuits, and a Supreme Court ruling last June has left the door open for more.

Feldman said the NCAA could open itself up to more antitrust exposure by failing to enforce its existing rules. But both antitrust lawsuits and national college law enforcement are slow to move.

“That would be like a tortoise and a tortoise,” Feldman said. “Neither will be done quickly, but there are a lot of risks in the meantime.”

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