By Gavin Dwyer, 2L member
Following the Supreme Court’s Alston decision in June, 28 states have adopted legislation allowing athletes to finally profit from their name, image, and likeness (“NIL”) rights. (NCAA v. Alston (U.S. 2021)).
The Court in Alston unanimously held that the NCAA violated the Sherman Act regarding caps placed on educational benefits conferred to athletes. The decision in Alston did not directly touch on the issue of athlete NIL and the legality of that NCAA restriction.
However, Justice Kavanaugh’s concurring opinion attacked the litany of NCAA rules and regulations, which, at the time, included restrictions on athletes profiting from NIL. He questioned whether the NCAA would be able to successfully survive the “rule of reason” scrutiny.
“Nowhere else in America can businesses get away with agreeing not to pay their workers a fair market rate on the theory that their product is defined by not paying their workers a fair market rate,” Kavanaugh wrote.
The NCAA heeded the shot sent across its bow by Justice Kavanaugh, and within a week the organization announced its relaxation on athlete NIL rights.
Prior to Alston, the NCAA would suspend athletes for monetizing their NIL rights through actions such as signing autographs for money. On July 1, the NCAA opened the NIL floodgates and left it to the state legislatures to determine the rules athletes must abide by when monetizing their NIL rights.
The NCAA punted on the idea of creating a uniform NIL policy, perhaps in fear of litigation over violations and overturning broader NCAA principles or muddying the waters enough for Congress to step in.
Either way, the NCAA’s actions created 28 different NIL statutes among states and countless others in states that do not have NIL legislation where individual universities created their own NIL policies to follow. The National College Players Association (“NCPA”) identified 21 different provisions either contained in or lacking from the 28 states that have created NIL legislation.
From these provisions, the NCPA identified New Mexico as the most NIL-friendly state, with a 90-percent grade. Alabama, Illinois, and Mississippi classify as the most NIL-restrictive, coming in with a 43-percent grade from NCPA.
This variance among states will inevitably lead to drastic differences in the ability for athletes to profit from their NIL and may affect recruiting classes in years to come.
One football player who took advantage of relaxed NIL laws is star quarterback recruit Quinn Ewers.
The Texas High School Association denied Ewers the ability to profit from his NIL as he entered what would have been his senior season in the fall of 2021. Accordingly, Ewers reclassified into early graduation and enrolled for the 2021-22 school year as a freshman at Ohio State University, where he entered a contract with GT Sports Marketing for $1.4 million.
Ewers failed to play a snap in 2021 for the Buckeyes. He announced in December he would transfer to the University of Texas, where he is expected to compete for the Longhorns’ starting QB job in 2022.
This simple example shows the difference between just two states’ NIL legislations.
First, Texas is one of three schools that prohibit high school athletes from participating in NIL deals (Illinois and Mississippi are the other two). Secondly, if the transfer happened in reverse (signing an NIL deal in Texas, then transferring to a school in Ohio), Ewers would be prevented by law from continuing the NIL contracts entered in Texas.
While minor in this case, differences of this type are littered throughout state NIL laws.
The NCAA and athletes have both pleaded to Congress to adopt a federal NIL policy that will guide and advise athletes. Multiple bills have been introduced, but none have passed at this time.
Now, some states that currently have NIL legislation are looking to either repeal or modify their existing laws as they are more restrictive than necessary to conform to the old NCAA rules. While the goal of revising the laws is to make them less restrictive, there is the possibility that it further muddies the water for universities and athletes to determine what they are allowed to contract for regarding their NIL rights.