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The NCAA’s temporary name, image, and likeness (NIL) policy proposal for college athletes does not seem to directly address whether prospective college athletes will be able to earn compensation. If a state law, such as Texas’, explicitly prohibits prospective college athletes from entering into any arrangement with a third party for the use of their NIL, then the high school athlete has no choice, but what about in states where the NIL law is silent or where there exists no NIL law at all?
Under the NCAA’s current Bylaw 18.104.22.168,
If an individual accepts remuneration for or permits the use of the individual’s name or picture to advertise or promote the sale or use of a commercial product or service prior to enrollment in a member institution, continued remuneration for the use of the individual’s name or picture (under the same or similar circumstances) after enrollment is permitted without jeopardizing eligibility to participate in intercollegiate athletics only if all of the following conditions apply:
(a) The individual’s involvement in this type of activity was initiated before enrollment in a member institution;
(b) The individual became involved in such activities for reasons independent of athletics ability;
(c) No reference is made in these activities to the individual’s name or involvement in intercollegiate athletics;
(d) The individual does not endorse the commercial product; and
(e) The individual’s remuneration under such circumstances is at a rate commensurate with the individual’s skills and experience as a model or performer and is not based in any way upon the individual’s athletics ability or reputation.
The rule is extremely vague and overbroad. How does one make a determination as to whether the athlete became involved in such NIL activity for reasons independent of the athlete’s “athletic ability?” Furthermore, how is it properly determined whether the athlete’s compensation was at a rate commensurate with the athlete’s skills and experience as a model or performer when the athlete was in high school? Finally, the rule is extremely limiting in that it only allows the athlete to grant the right to a third party to use the athlete’s NIL and outright restricts the athlete from overtly endorsing the third party’s product or service.
Even if the NCAA adjusts its position on Bylaw 22.214.171.124 and allows prospective college athletes to engage with third parties to endorse their brands based on the athletes’ “athletics ability,” existing individual state regulations could pose a threat to athletes who choose to participate in such activities. For instance, the Bylaws of the Florida High School Athletic Association includes Bylaw 9.9.2 titled, “Forfeiture of Amateur Status,” which includes the following:
A student-athlete forfeits amateur status in a particular sport for one year by:
(a) Competing for money or other monetary compensations;
(b) Receiving any award or prize of monetary value which has not been approved by the FHSAA;
(c) Capitalizing on athletic fame by receiving money or gifts of a monetary nature;
(d) Signing a professional playing contract in any sport or hiring an agent to manage his/her athletic career;
(e) Competing under an assumed name.
The relevant concern is Bylaw 9.9.2(c), which prohibits a high school athlete from capitalizing on the athlete’s athletic fame by receiving money or gifts of a monetary nature. Again, assuming that the NCAA will not prohibit prospective college athletes from earning compensation related to NIL deals (which is mere speculation at this given time), it is possible that various state high school athletics associations prevent high school athletes from participating in such commercial activities, which leads to an interesting question. Could the restriction be deemed a violation of Section 1 of the Sherman Antitrust Act, which prohibits contracts and conspiracies in restraint of trade or commerce? The NCAA very recently lost a case at the Supreme Court level on such grounds, with specific regard to its caps on schools covering athletes’ academic-related expenses.
There are many important, unanswered questions surrounding NIL as July 1 approaches, with seven states promising NIL rights to college athletes and the NCAA only now discussing a potential hands-off approach, placing the burden on colleges to largely adopt their own respective NIL policies. The biggest lingering question may be whether high school athletes will have the same capacity as current college athletes to exploit their publicity rights and, if not, then how long until the first lawsuit is filed?