By Ross Crowell, Law Library GRA Sports Law Correspondent
Prior to 2021, college athletes were strictly seen as unpaid athletes. That has changed over the past several months, as now college athletes are able to make money off of their name, image and likeness (“NIL”). While the schools are still not allowed to directly pay their student athletes, the student athletes can now make money from things like advertisements and social media. However, the confusing legal environment surrounding NIL means that colleges and athletes are unsure of what they can and cannot do.
The history behind the change involves federalism, activism, and antitrust law. First, Florida passed a state law in June 2020 that legalized college athletes to capitalize off of their name, image and likeness, with the law going into effect on July, 1, 2021. Several other states followed Florida. These state laws, along with activism by the college athletes , a Supreme Court opinion holding NCAA limits on education-related benefits to be invalid under federal antitrust law, and other events, led to the NCAA adopting a temporary rule change on June 30, 2021, allowing college athletes to benefit from their name, image, and likeness.
The NCAA abruptly enacting this temporary rule change has created mass confusion among its member schools, as there is currently not much clarity on what is and what is not allowed. Additionally, different states having very different NIL laws has put some schools at a disadvantage. For example, Alabama and Florida, among other states, have stricter NIL laws than other states. Thus, college athletes in those jurisdictions cannot take advantage of the NIL to the same degree as athletes in states that do not have any NIL law at all (such as Kentucky and Virginia).
With players signing lucrative NIL contracts to appear in national advertisements for established brands, stakeholders are seeking clarity and uniformity. From the perspective of colleges, restrictive state NIL laws could be a disadvantage in recruiting, or even prompt top athletes to transfer to schools where they can fully take advantage of NIL. This resulted in the Alabama House voting in favor of repealing its prior law. Other states likely will follow, as the state legislatures will want their universities on a level playing field with schools in other states.
The best solution to this issue may be to enact a new federal law to restore uniformity by preempting the current state NIL laws. Instead of 50 different state laws dictating how their college athletes can profit from their NILs, there would be a single rule that all universities and teams have to play by.
The NCAA seems to feel the same way. When the NCAA announced the legality of NIL on June 30, 2021, Division I Board of Directors chair Denise Trauth said, “with this interim solution in place, we will continue to work with Congress to adopt federal legislation to support student-athletes.” Congress held a hearing on October 1, 2021, where NCAA president Mark Emmert called on Congress to act, claiming that the NCAA has an urgent need for NIL federal framework.
So far, there has not been any federal or NCAA action taken. This will be an interesting issue to follow, as many college sports pundits claim that NIL has turned college athletics into the “wild wild west” without an overarching law.