Subscriber Benefit
As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe Now
It is not business as usual in college athletics right now. Antitrust claims and suits alleging athletes should be treated as employees have shaken up the formerly settled space.
After the 2021 U.S. Supreme Court decision that the NCAA’s restrictions on paying athletes violated antitrust law, the NCAA revised its rules, allowing athletes to charge for use of their “name, image, and likeness,” or NIL.
The big news now is about a major settlement that, if approved, will provide athletes back pay for uncompensated use of their NIL and open the door to “revenue sharing” in college athletics. In the era of Caitlin Clark, how will schools decide to share their revenue?
I spend much of my time practicing employment law, including advising colleges and universities on employment law litigation and compliance. But I also defend complaints and litigation brought by students or respond to investigations launched by the U.S. Department of Education Office for Civil Rights, or OCR.
I have thus learned that laws like Title VI, Title IX, Title II of the ADA, and section 504 of the Rehabilitation Act are similar in scope to employment discrimination laws but bear important differences.
Interestingly, administrative enforcement tends to be focused more on correction than punishment. OCR investigates complaints by aggrieved students but also by advocacy groups who wish to flag an institution’s noncompliance.
Failure to accommodate a student’s disability is a frequent complaint that schools face. Complaints that a school awards sex- or race-specific or preferred scholarships have recently become more common.
To avoid such complaints, schools may ask donors to drop such restrictions. It is unclear at this point whether the Trump administration’s education department will continue to find the “pool and match” process acceptable.
OCR also investigates complaints that schools may be in violation of Title IX in awarding athletic scholarships. In general, Title IX requires schools to treat male and female students the same.
When it comes to athletics, OCR is looking for male and female student-athletes to have equivalent opportunity to participate in athletics and to have equivalent benefits and resources.
When it comes to athletic financial assistance, OCR does not require that all athletes receive the same scholarship amounts; rather, the proportion of total athletic financial assistance a school provides to male athletes must match the proportion of males who participate in varsity sports offered by the school. In other words, if 45 percent of the school’s total athletes are male, then 45 percent of total athletic aid should go to male athletes. OCR will accept only a one percentage point deviation except in very limited circumstances.
In the antitrust litigation I mentioned above, the parties in House v. NCAA reached a settlement last year, which the judge assigned to the matter preliminarily approved in October 2024.
The “House Settlement” will involve back pay to eligible athletes associated with the defendants’ use of their NIL over a ten-year period. Additionally, the NCAA will revise its rules to begin allowing schools to make direct payments to athletes out of athletic program revenues (up to $20 million per year).
A final hearing to approve the settlement is scheduled for April. If the settlement receives final approval, backpay payments by the defendant schools will begin in May, and schools that decide to participate in revenue sharing may begin doing so for the 2025 fall semester.
House v. NCAA has nothing to do with Title IX, but schools who elect to take part in revenue sharing must consider the likelihood that OCR will consider rev-share payments made to athletes to be a payment of athletic financial assistant and therefore subject to the proportionality rule.
A hint to that development arrived in mid-January, when OCR published a fact sheet that stated that a school’s direct payments to athletes for their NIL is a form of athletic financial assistance requiring proportionality.
Some schools intend to test the waters by adopting a “market share” approach, in which athletes who play sports that bring in the most revenue will receive the largest rev-share payments.
Other schools, including all Big 10 conference schools, reportedly plan to adhere to the DOE’s policy interpretation requiring proportionality.
It remains to be seen whether the education department as staffed by the current administration will make athletic aid equality an enforcement priority; even so, lawsuits by female athletes against schools who pursue the market share approach are anticipated.
It seems inevitable that the Title IX implications of revenue sharing will be the next big legal showdown for college athletics. Meanwhile, the cases involving athletes alleging employee status, some of which survived dismissal motions last year, are also being closely watched.
One could say that college athletics are spectator sports in more ways than one.•
__________
Germaine Winnick Willett is a senior counsel at Ice Miller LLP. Opinions expressed are those of the author.
Please enable JavaScript to view this content.