Latest news with #HouseSettlement
New York Times
7 hours ago
- Business
- New York Times
Mandel: House settlement clearinghouse won't create CFB's goal for more level playing field
With the House vs. NCAA settlement approved, college athletics is about to begin the latest chapter in its long history of attempting to interfere with the market for athletes' services. Let's see if this version holds up better in court than all the ones before it. As you know by now, the House settlement has given birth to a new system by which schools for the first time can directly pay their athletes up to $20.5 million this coming school year. The schools will insist these are purely NIL deals and do not constitute 'pay-for-play,' but of course, they are entirely contingent on the athlete playing for that university. And that's fine. Nothing wrong with paying someone for their services. Advertisement But where the settlement veers into outright market manipulation is the establishment of a new NIL Go clearinghouse, operated by Deloitte, by which athletes must submit all deals they receive from outside sources that exceed $600. Which, in the major sports, is pretty much all of them. If Deloitte deems, say, a running back's $1 million deal from a school's collective to be above 'fair market value,' he cannot accept it. In every other industry in this country, 'fair market value' is whatever someone is willing to pay you. Just ask the many mediocre football coaches who make $6-8 million a year. Or the athletic directors who make $1.2 million a year to hire those mediocre coaches. No clearinghouse for those folks. Every legal expert I've spoken with about this subject thinks there's little chance this clearinghouse would survive a legal challenge. It sure sounds like yet another instance of competitors (in this case, the Power conferences) conspiring to limit athletes' compensation. Go back and read the Supreme Court decision in Alston v. NCAA to see how the highest court in the land feels about restrictions on athletes' compensation. It's somewhat poetic the House settlement got approved during Game 3 of the WCWS, where $1M pitcher NiJaree Canady nearly led Texas Tech to an improbable national title. Because the purpose of the new Deloitte NIL clearinghouse is to stamp out collectives like Texas Tech's. — Stewart Mandel (@slmandel) June 7, 2025 Nevertheless, the Power conferences — it's them, not the NCAA driving this — are pressing ahead. On Monday, they proudly unveiled their newly created enforcement entity, the College Sports Commission, led by former Major League Baseball executive Bryan Seeley, who is likely being paid seven figures to make sure college athletes stop getting paid seven figures. Presumably, they've consulted with their lawyers, who have told them the thing is ironclad. The next Judge Wilken will be totally fine with it. By now, you may be asking yourself, 'Why are they doing this? Who exactly is being harmed by a transfer quarterback getting $3 million from a school's collective?' Athletes going into the portal at any moment is an understandable source of frustration, but the House settlement does nothing to address that issue. It just wants to curb how much one gets for going into the portal. Advertisement The stated reason, as Nick Saban, for one, has said 1,000 times, is the need for a 'level playing field.' It's not 'fair' that Texas Tech has an oil billionaire willing to spend $10 million-plus on the transfer portal if Alabama doesn't have one. How many times have we heard: This is not what NIL is intended for. It doesn't particularly matter at this point what NIL was intended for. This is what it's become. Collectives became a thing specifically because schools didn't want anything to do with paying athletes. Now that they're forced to, they want to unwind time and reverse things. But what's really rich is the whole 'level playing field' thing. There has never, ever been a level playing field in college recruiting. The schools with the most money have always held an advantage over everyone else. They have the most history, the biggest stadiums, the best-paid coaches and the most lavish facilities. Ohio State was dominating Purdue in recruiting long before there were ever NIL collectives, and the Buckeyes will keep dominating in the revenue-sharing era. You could set the cap at $60.5 million, not $20.5 million, and there's still no scenario where the Boilermakers would be able to outspend the Buckeyes. Meanwhile, people have been so busy the past few years shouting that the sky is falling that they've failed to notice that NIL may be the first development in history that's actually given a larger pool of teams a chance at landing top talent. The top quarterback in the portal this offseason, Tulane's Darian Mensah, did not go to Georgia or Ohio State. He chose Duke, where he's getting a reported $4 million NIL deal. The nation's No. 1 men's basketball recruit, A.J. Dybantsa, is not going to North Carolina or Kansas; he's going to BYU, for a reported $5 million deal. And last year, softball phenom NiJaree Canady turned down that sport's biggest juggernaut, Oklahoma, in favor of Texas Tech, which gave her that sport's first-ever seven-figure deal. Earlier this month, she and her team ended the Sooners' reign — and she signed another deal. Advertisement All of those deals got done before the House settlement was approved. Had they not, theoretically, Deloitte could flag them for being too far above 'market value.' Clearly, booster-driven collectives aren't going away. If Oracle founder Larry Ellison wants to give the next Michigan quarterback recruit $4 million, it seems highly unlikely someone could tell him no. Either the collectives will get more creative in how they structure their deals, or someone is going to sue and succeed in getting an injunction. Neither the schools nor the athletes would be the ones filing that suit because they're bound by the settlement. But boosters aren't bound by it. Companies aren't bound by it. And, most concerning to the conferences, state attorneys general aren't bound by it. They're the folks who succeeded in getting both the NCAA's booster restrictions and transfer restrictions shot down. We know this much: Most schools that plan to offer the maximum $20.5 million in House payments are following a formula by which they'll allocate around $13 million for football and $3 million for men's basketball. Ohio State last year spent $20 million on football alone, and many schools are spending way more than that this year. Kentucky is one of several programs planning to spend more than $10 million on men's basketball. Coaches' and administrators' salaries have only gone up and up and up over time, but the powers that be seem to think they can make athletes' unofficial salaries go down with their magic clearinghouse. That's not generally how markets work.
Yahoo
17 hours ago
- Business
- Yahoo
Kraft rebukes involvement in private equity fund
UNIVERSITY PARK (WTAJ) — Sports agency network Elevate said they have partnered with Penn State and UCLA as the company introduces a $500 million private equity fund for college athletics, but both schools have rebuked the report. Penn State athletics director Pat Kraft released a statement saying 'Elevate serves as our partner in ticketing strategy and operations. To clarify, our relationship is strictly limited to these services, and we have no affiliation or involvement with any private equity firm or fund.' UCLA released a similar statement linking the Bruins to the company for ticketing purposes only. Elevate's College Investment Initiative is a private equity (PE) fund funded primarily by Velocity Capital Management and the Texas Permanent School Fund. PE is widely viewed as the next frontier in college athletics as schools look to offset costs by the changing landscape of the sports, and the new revenue sharing model set up by last week's groundbreaking House Settlement deal. Federal judge approves $2.8B settlement, paving way for US colleges to pay athletes millions The nearly $3 billion settlement provides back pay benefits, sets up NIL oversight and allows schools to share more than $20 million in revenue with athletes. That number is close to 10% of what the highest earning schools make, but also more than some of the lowest schools make in a year, like Louisiana-Monroe, who make $19 million according to a 2024 report by USA Today. But many questions on how this would all work out remain. College football teams are not businesses and can't be bought and sold like stocks and companies, though some suggest PE could purchase teams, portions of teams, or assets like merchandise or media rights. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
a day ago
- Business
- Yahoo
Ohio State AD Ross Bjork reacts to NCAA House Settlement, outlines basic framework
In case you missed it, a judge approved the NCAA House Settlement late last week, not only setting aside distribution payouts for former athletes, but also paving the way for direct payment to student-athletes. Name, Image and Likeness will still be in play, but now anything over $600 will need to be approved by an NCAA Clearinghouse, meaning some of the larger deals will be harder to broker and more in the open, or else, face penalties of some sort. This impacts all schools, big and large, but significantly restructures and reorganizes efforts in recruiting, NIL, and roster management at the biggest of schools and football factories like Ohio State. So then, wouldn't it be interesting to see what those in the suits on the banks of the Olentangy have to say about the development that was a long time coming? Sure it would. And, on that note, Ohio State Athletic Director Ross Bjork did provide a statement to the media in preparation for a further press conference later this week that puts a straw man template in place for the position he'll take to lead the OSU program through the changes coming. 'The signing of the House settlement Friday by Judge Claudia Wilken will reshape collegiate athletics. Ohio State and schools around the country will now be permitted to directly compensate student-athletes through revenue sharing, which is actually institutional NIL rights," Bjork said in a statement. "The Department of Athletics will fully fund the revenue sharing program, which will total $20.5 million and includes funding for additional scholarships for both women's and men's sports. We remain committed to maintaining the student-athlete model, offering 36 intercollegiate sports and providing scholarships to all 36.' There will be more to come at the presser later this week, but we can take a couple of things from his statement. First, the revenue sharing program will be fully funded by the Department of Athletics. Maybe this was a foregone conclusion, but it does raise questions on several logistics like the proverbial how, when, and where this will all happen. Secondly, the amount of funding looks like it has been outlined. Maybe things will change a little north or south of this number (again, we'll find out more Thursday), but the total looks to be $20.5 million. Also, and very important, many had to wonder if this new model would mean the loss of scholarships and other athletic programs of some of the non-revenue sports. It looks like there will be an effort to keep all 36 sports with both men and women, all funded through the model. Maybe that's too optimistic, maybe not -- we'll have to again take a wait and see approach and wait to hear, see, and feel more. This is a nugget of interesting news, and this is, of course, only the tip of the iceberg of what we'll find out in the coming days, weeks, and months. Contact/Follow us @BuckeyesWire on X (formerly Twitter) and like our page on Facebook to follow ongoing coverage of Ohio State news, notes and opinion. Follow Phil Harrison on X. This article originally appeared on Buckeyes Wire: Ohio State AD Ross Bjork reacts to House Settlement approval
USA Today
2 days ago
- Business
- USA Today
Nebraska athletic director issues statement on historic House Settlement
Nebraska athletic director issues statement on historic House Settlement A federal judge has finally approved a settlement that could change the face of college athletics. Judge Claudia Ann Wilken approved the House Settlement, paving the way for college athletes to be financially compensated for their name, image, and likeness (NIL) directly by their school. A lawsuit was filed by Grant House, a former Arizona State swimmer, who sued the NCAA and the five biggest athletic conferences in the country. The settlement will now allow schools to directly compensate their student-athletes for their NIL rights. There are nearly 200,000 athletes and 350 schools in Division I alone, and 500,000 and 1,100 schools across the entire NCAA, according to data from the Associated Press. In the first year under the settlement, schools will be allowed to share up to $20.5 million with their athletes. That number represents 22% of their revenue from sources such as media rights, ticket sales, and sponsorships. Third parties are still permitted to enter into NIL deals with players under this agreement. Another aspect of the settlement is the $2.7 billion in back pay that will be paid to athletes who competed between 2016 and 2024. Those funds will come from the NCAA and the conferences. Contact/Follow us @CornhuskersWire on X (formerly Twitter), and like our page on Facebook to follow ongoing coverage of Nebraska news, notes, and opinions.
Associated Press
4 days ago
- Business
- Associated Press
Federal judge approves $2.8B settlement, paving way for US colleges to pay athletes millions
A federal judge signed off on arguably the biggest change in the history of college sports on Friday, clearing the way for schools to begin paying their athletes millions of dollars as soon as next month as the multibillion-dollar industry shreds the last vestiges of the amateur model that defined it for more than a century. Nearly five years after Arizona State swimmer Grant House sued the NCAA and its five biggest conferences to lift restrictions on revenue sharing, U.S. Judge Claudia Wilken approved the final proposal that had been hung up on roster limits, just one of many changes ahead amid concerns that thousands of walk-on athletes will lose their chance to play college sports. The sweeping terms of the so-called House settlement include approval for each school to share up to $20.5 million with athletes over the next year and $2.7 billion that will be paid over the next decade to thousands of former players who were barred from that revenue for years.
