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Chicago Tribune
3 hours ago
- Chicago Tribune
153 NCAA rules had to be eliminated to clear the way for the House settlement. Here are numbers to know.
The groundbreaking case leading to the transformation of college sports in the United States comes nearly five years after Arizona State swimmer Grant House and Oregon basketball player Sedona Prince filed a complaint against the NCAA and the five most powerful conferences alleging they were unfairly being denied of pay for use of their name, image and likeness. The settlement approved Friday by U.S. District Judge Claudia Wilken resolved three antitrust cases — House vs. NCAA, Carter vs. NCAA and Hubbard vs. NCAA — that became known collectively as the 'House case.' The class-action lawsuits contended the NCAA, ACC, Big Ten, Big 12, Pac-12 and SEC violated antitrust law by not providing benefits and compensation to athletes and restraining athletes' ability to make money for endorsements and sponsorships. Incremental gains won by athletes in previous lawsuits against the NCAA set the stage for the House settlement and the all-out professionalization of college sports. Here's a look at key numbers associated with the case. Athletes who played an NCAA sport between 2016-24 and could be eligible for back payments Class members who submitted a claim form or updated their payment information, which represents approximately 26.2% of the 389,700. Athletes who opted out of the settlement and could pursue their own remedies. Back damages to be paid to current and former college athletes who were denied the opportunity to profit from the use of their NIL rights. The amount will be paid in $280 million installments over 10 years. The NCAA will use reserves and insurance to cover about 40% of the payments. The rest will be covered by the NCAA reducing its annual distributions to Division I schools. Estimated amount of the $2.8 billion that will be paid in back damages to football and men's and women's basketball players in power conferences. The 2025-26 pool of money each Division I school can distribute in direct payments to athletes beginning July 1. The amount represents 22% of the average revenue generated by each school from the five defendant conferences and Notre Dame. NCAA rules that had to be eliminated to allow schools to provide additional benefits to athletes under the settlement. All Division I athletes will be required to report to their schools and the Deloitte clearinghouse any and all third-party NIL contracts with a total value of $600 or more, if payment occurs after July 1, 2025. The clearinghouse will determine whether the amount is commensurate with the athlete's fair market value. The widely accepted estimate by University of San Francisco sports economist Daniel Rascher of additional direct compensation athletes will receive over the next 10 years. The estimated amount of damages faced by the NCAA and the five conferences if they avoided a settlement and lost at trial. Plaintiffs attorneys' request for legal fees. The figure is based on attorneys receiving 20% of the NIL settlement fund and 10% of the additional compensation settlement fund as well as an injunction relief award of $20 million paid by the defendants. That does not included about $9 million in expenses attorney.

3 hours ago
A $2.8 billion settlement will change college sports forever. Here's how
A federal judge has approved terms of a sprawling $2.8 billion antitrust settlement that will upend the way college sports have been run for more than a century. In short, schools can now directly pay players through licensing deals — a concept that goes against the foundation of amateurism that college sports was built upon. Some questions and answers about this monumental change for college athletics: A: Grant House is a former Arizona State swimmer who sued the defendants (the NCAA and the five biggest athletic conferences in the nation). His lawsuit and two others were combined and over several years the dispute wound up with the settlement that ends a decades-old prohibition on schools cutting checks directly to athletes. Now, each school will be able to make payments to athletes for use of their name, image and likeness (NIL). For reference, there are nearly 200,000 athletes and 350 schools in Division I alone and 500,000 and 1,100 schools across the entire NCAA. A: In Year 1, each school can share up to about $20.5 million with their athletes, a number that represents 22% of their revenue from things like media rights, ticket sales and sponsorships. Alabama athletic director Greg Byrne famously told Congress 'those are resources and revenues that don't exist.' Some of the money will come via ever-growing TV rights packages, especially for the College Football Playoff. But some schools are increasing costs to fans through 'talent fees,' concession price hikes and 'athletic fees' added to tuition costs. A: Scholarships and 'cost of attendance' have always been part of the deal for many Division I athletes and there is certainly value to that, especially if athletes get their degree. The NCAA says its member schools hand out nearly $4 billion in athletic scholarships every year. But athletes have long argued that it was hardly enough to compensate them for the millions in revenue they helped produce for the schools, which went to a lot of places, including multimillion-dollar coaches' salaries. They took those arguments to court and won. A: Yes, since 2021. Facing losses in court and a growing number of state laws targeting its amateurism policies, the NCAA cleared the way for athletes to receive NIL money from third parties, including so-called donor-backed collectives that support various schools. Under House, the school can pay that money directly to athletes and the collectives are still in the game. A: Probably not. But under terms of the settlement, third parties are still allowed to cut deals with the players. Some call it a workaround, but most simply view this as the new reality in college sports as schools battle to land top talent and then keep them on campus. Top quarterbacks are reportedly getting paid around $2 million a year, which would eat up about 10% of a typical school's NIL budget for all its athletes. A: The defendant conferences (ACC, Big Ten, Big 12, SEC and Pac-12) are creating an enforcement arm that is essentially taking over for the NCAA, which used to police recruiting violations and the like. Among this new entity's biggest functions is to analyze third-party deals worth $600 or more to make sure they are paying players an appropriate 'market value' for the services being provided. The so-called College Sports Commission promises to be quicker and more efficient than the NCAA. Schools are being asked to sign a contract saying they will abide by the rules of this new structure, even if it means going against laws passed in their individual states. A: A key component of the settlement is the $2.7 billion in back pay going to athletes who competed between 2016-24 and were either fully or partially shut out from those payments under previous NCAA rules. That money will come from the NCAA and its conferences (but really from the schools, who will receive lower-than-normal payouts from things like March Madness). A: Since football and men's basketball are the primary revenue drivers at most schools, and that money helps fund all the other sports, it stands to reason that the football and basketball players will get most of the money. But that is one of the most difficult calculations for the schools to make. There could be Title IX equity concerns as well. A: The settlement calls for roster limits that will reduce the number of players on all teams while making all of those players – not just a portion – eligible for full scholarships. This figures to have an outsize impact on Olympic-sport athletes, whose scholarships cost as much as that of a football player but whose sports don't produce revenue. There are concerns that the pipeline of college talent for Team USA will take a hit. A: The new enforcement arm seems ripe for litigation. There are also the issues of collective bargaining and whether athletes should flat-out be considered employees, a notion the NCAA and schools are generally not interested in, despite Tennessee athletic director Danny White's suggestion that collective bargaining is a potential solution to a lot of headaches. NCAA President Charlie Baker has been pushing Congress for a limited antitrust exemption that would protect college sports from another series of lawsuits but so far nothing has emerged from Capitol Hill.


San Francisco Chronicle
4 hours ago
- San Francisco Chronicle
A $2.8 billion settlement will change college sports forever. Here's how
A federal judge has approved terms of a sprawling $2.8 billion antitrust settlement that will upend the way college sports have been run for more than a century. In short, schools can now directly pay players through licensing deals — a concept that goes against the foundation of amateurism that college sports was built upon. Some questions and answers about this monumental change for college athletics: Q: What is the House settlement and why does it matter? A: Grant House is a former Arizona State swimmer who sued the defendants (the NCAA and the five biggest athletic conferences in the nation). His lawsuit and two others were combined and over several years the dispute wound up with the settlement that ends a decades-old prohibition on schools cutting checks directly to athletes. Now, each school will be able to make payments to athletes for use of their name, image and likeness (NIL). For reference, there are nearly 200,000 athletes and 350 schools in Division I alone and 500,000 and 1,100 schools across the entire NCAA. Q: How much will the schools pay the athletes and where will the money come from? A: In Year 1, each school can share up to about $20.5 million with their athletes, a number that represents 22% of their revenue from things like media rights, ticket sales and sponsorships. Alabama athletic director Greg Byrne famously told Congress 'those are resources and revenues that don't exist.' Some of the money will come via ever-growing TV rights packages, especially for the College Football Playoff. But some schools are increasing costs to fans through 'talent fees,' concession price hikes and 'athletic fees' added to tuition costs. Q: What about scholarships? Wasn't that like paying the athletes? A: Scholarships and 'cost of attendance' have always been part of the deal for many Division I athletes and there is certainly value to that, especially if athletes get their degree. The NCAA says its member schools hand out nearly $4 billion in athletic scholarships every year. But athletes have long argued that it was hardly enough to compensate them for the millions in revenue they helped produce for the schools, which went to a lot of places, including multimillion-dollar coaches' salaries. They took those arguments to court and won. Q: Haven't players been getting paid for a while now? A: Yes, since 2021. Facing losses in court and a growing number of state laws targeting its amateurism policies, the NCAA cleared the way for athletes to receive NIL money from third parties, including so-called donor-backed collectives that support various schools. Under House, the school can pay that money directly to athletes and the collectives are still in the game. Q: But will $20.5 million cover all the costs for the athletes? A: Probably not. But under terms of the settlement, third parties are still allowed to cut deals with the players. Some call it a workaround, but most simply view this as the new reality in college sports as schools battle to land top talent and then keep them on campus. Top quarterbacks are reportedly getting paid around $2 million a year, which would eat up about 10% of a typical school's NIL budget for all its athletes. Q: Are there any rules or is it a free-for-all? A: The defendant conferences (ACC, Big Ten, Big 12, SEC and Pac-12) are creating an enforcement arm that is essentially taking over for the NCAA, which used to police recruiting violations and the like. Among this new entity's biggest functions is to analyze third-party deals worth $600 or more to make sure they are paying players an appropriate 'market value' for the services being provided. The so-called College Sports Commission promises to be quicker and more efficient than the NCAA. Schools are being asked to sign a contract saying they will abide by the rules of this new structure, even if it means going against laws passed in their individual states. Q: What about players who played before NIL was allowed? A: A key component of the settlement is the $2.7 billion in back pay going to athletes who competed between 2016-24 and were either fully or partially shut out from those payments under previous NCAA rules. That money will come from the NCAA and its conferences (but really from the schools, who will receive lower-than-normal payouts from things like March Madness). Q: Who will get most of the money? A: Since football and men's basketball are the primary revenue drivers at most schools, and that money helps fund all the other sports, it stands to reason that the football and basketball players will get most of the money. But that is one of the most difficult calculations for the schools to make. There could be Title IX equity concerns as well. Q: What about all the swimmers, gymnasts and other Olympic sports athletes? A: The settlement calls for roster limits that will reduce the number of players on all teams while making all of those players – not just a portion – eligible for full scholarships. This figures to have an outsize impact on Olympic-sport athletes, whose scholarships cost as much as that of a football player but whose sports don't produce revenue. There are concerns that the pipeline of college talent for Team USA will take a hit. Q: So, once this is finished, all of college sports' problems are solved, right? A: The new enforcement arm seems ripe for litigation. There are also the issues of collective bargaining and whether athletes should flat-out be considered employees, a notion the NCAA and schools are generally not interested in, despite Tennessee athletic director Danny White's suggestion that collective bargaining is a potential solution to a lot of headaches. NCAA President Charlie Baker has been pushing Congress for a limited antitrust exemption that would protect college sports from another series of lawsuits but so far nothing has emerged from Capitol Hill.