The Big 12 and the ACC approved House v. NCAA settlement proposals

The Independent

By Chris Vannini, Nicole Auerbach and Justin Williams Presidents and chancellors in both the Big 12 Conference and ACC voted to approve proposals of a settlement in the House v. NCAA class-action lawsuit on Tuesday, sources briefed on the decision confirmed to The Athletic.
It’s another step toward finalizing a settlement in the landmark case that is likely to reshape the college sports business model.
The Big 12 was the first of the suit’s defendants to vote on the settlement terms, followed by the ACC later in the day.
The remaining power conferences and NCAA Board of Governors are expected to vote this week as well.
House v. NCAA was filed in 2020 in front of Judge Wilken, the same judge who notably ruled against the NCAA in the O’Bannon and Alston lawsuits.
A loss at trial would also strike down any existing constraints on NIL and revenue sharing moving forward.
A settlement would give the NCAA more input on payment structures for the damages and revenue sharing, as well as some safeguards against other legal battles.
Required reading How the House v. NCAA settlement could reshape college sports: What you need to know How do college football teams keep players out of the transfer portal in the NIL age?

POSITIVE

by Nicole Auerbach, Justin Williams, and Chris Vannini.

All of the Big 12 Conference’s and the ACC’s chancellors cast votes in favor of the settlement proposals in the House v. sources briefed on the ruling confirmed to The Athletic that an NCAA class-action lawsuit was filed on Tuesday. It’s another step toward finalizing a settlement in the landmark case that is likely to reshape the college sports business model.

Later in the day, the ACC was the second defendant in the lawsuit to cast a vote on the terms of the settlement, after the Big 12. This week’s elections are also anticipated by the NCAA Board of Governors and the remaining power conferences. According to people briefed on the negotiations, the settlement details are anticipated to include a future revenue sharing model between power-conference schools and athletes, as well as approximately $27 billion in back-pay damages the NCAA will owe to former Division I athletes. The damages would probably be distributed over a ten-year period using a combination of NCAA reserve funds and reductions in future revenue distributions to conferences. The damages were made available to Division I athletes dating back to 2016 as back-pay for lost name, image, and likeness (NIL) earning opportunities.

According to a college administrator briefed on the proposal, which is currently up for vote, the damages payment model is a slightly modified version of the original breakdown proposed by the NCAA. It calls for the NCAA to pay for about $11 billion in damages, with the power conferences picking up the additional 40 percent. That’s in spite of the recent internal strife within the NCAA over the smaller, non-FBS Division I conferences’ claims that they bear an unfairly large financial burden from the proposed funding plan.

Potentially implemented as early as next year, the revenue sharing model would allow power-conference programs to give athletes a direct payout of 22 percent of their average annual revenue, or about $20 million annually.

The settlement would represent the most substantial change to the long-standing amateurism framework in college sports if it is finalized, a process that will take several months.

DIVE IN NOW.

How the House came to be. This is what you need to know about how the NCAA settlement could change college sports.

“At the ACC spring meetings last week, NCAA president Charlie Baker stated, ‘The most important part of the settlement—and let’s face it, there’s still a lot of work to be done there—is it creates some clarity and some visibility on a whole bunch of issues that have sort of been roiling everybody for a while.”. Additionally, it gives schools a sense of stability and predictability. For student athletes, it opens up a world of opportunities. “.

The settlement will be presented to Judge Claudia Wilken of the U.S. once the NCAA and power conferences have agreed on the terms and both parties have signed off. s. District Court for the Northern District of California in order to obtain initial clearance. If it’s approved, people in the future revenue-sharing class would be able to object to the terms of the agreement, and those in the retroactive damages class would have a set period of time, roughly ninety days, to opt out. After that, there is a final hearing for approval, and if the judge grants it, the settlement formally becomes operative.

House versus. The NCAA filed a lawsuit in 2020 before Judge Wilken, the same judge who famously dismissed the NCAA’s appeal in the O’Bannon and Alston cases. Lead attorneys Steve Berman and Jeffrey Kessler are representing the two named plaintiffs, Grant House, a former swimmer for Arizona State, and Sedona Prince, a former Oregon and current women’s basketball player for TCU.

In essence, it is a two-piece suit with one facing forward and the other backward. The latter seeks an injunction forcing the NCAA and power conferences to lift regulations prohibiting revenue sharing from broadcast rights, while the former seeks retroactive NIL damages prior to the NCAA policy change in the summer of 2021.

Go deeper.

How collegiate athletics administrators are handling the possibility of a historic settlement.

Wilken certified the damages portion of the House case as class-action in November, extending the suit’s reach to include any Division I athlete from 2016 onwards, subject to a four-year statute of limitations. Due to this, the case, which is set for trial in January 2025, could result in damages that are exponentially higher.

Though the NCAA, which has long opposed paying athletes, would both benefit from a settlement and bring about significant change in college sports, the NCAA has an incentive to settle the dispute without going to trial. Based on documents obtained by Yahoo Sports and shared with power conference presidents and administrators, if the NCAA lost the trial, it might be liable for damages as much as $20 billion. That’s a sum that would need to be paid out right away and might even force the NCAA to declare bankruptcy. Any current restrictions on NIL and revenue sharing would also be eliminated in the event of a trial loss.

In other words, if we prevail, Kessler stated, “there would be a complete free market in NIL, including from broadcast payments.”.

Along with some protections against future legal disputes, a settlement would give the NCAA greater say over how the damages and revenue sharing are paid out. Hubbard v. would be resolved by settling the House case. Carter v. and the NCAA. Those briefed on the settlement negotiations claim that NCAA, two other well-known antitrust lawsuits in which the plaintiffs are represented by Berman and Kessler in the Northern District of California, will obstruct any further antitrust complaints over the following ten years. This is regarded as a crucial component of the settlement terms for the NCAA, which has recently been hit with a slew of legal issues.

A portion of the settlement is also anticipated to include newly established roster limits for power-conference sports; the leagues will decide on the precise scholarship amounts in the upcoming months.

Beyond the settlement, unanswered concerns still surround the future of third-party NIL collectives, the role of Title IX in revenue sharing, and the continuous discussion surrounding unionization efforts and employment status.

Reading requirements.

How did the House get involved? This is what you need to know about how the NCAA settlement could change college sports.

How do collegiate football teams prevent players from using the NIL age transfer portal?

(Image courtesy of Getty Images and Mitchell Layton).

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