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Scoring A Touchdown With NIL Rights

“NIL” is short for “Name, Image, Likeness,” but for college athletes it may now mean “no income limits.” All three branches of government have essentially agreed that a college athlete could be paid for his/her NIL activities. However, what this means exactly is still far from clear.

First, I must give a nod to Mr. Justice Gorsuch for his thoroughly entertaining history of the “paid” student athlete – without any personal knowledge of such shenanigans where he went to college. From his opinion, we learn such tidbits as the first intercollegiate athletic competition was a boat race between (who else) Harvard and Yale that was sponsored by a railroad executive who offered contestants all-expense paid vacations and unlimited beer. And in the intercollegiate football arena, Yale lured one tackle with free tuition and meals, a trip to Cuba, the exclusive right to sell scorecards at the games, and a job as a cigarette agent for the American Tobacco Company. Life apparently wasn’t much different from art when Professor Wagstaff tried to purchase two professional football players so that his beleaguered Huxley College could win the big game against rival Darwin.

After Justice Gorsuch effectively said “Horse Feathers” to the NCAA’s monopoly on capitalizing on its student athletes, the stage is now set for booming new business ventures. July 1, 2021 is the big day. The NCAA may approve allowing college athletes to profit from their NIL and at least seven state laws (Alabama, Florida, Mississippi, New Mexico, Tennessee and Texas) will go into effect. Another 12 states have passed similar laws that go into effect in 2022 and 2023.

But what will this mean for schools, conferences, and states that have not given such approval? And how will the laws or lack of laws co-exist? Apparently, the legality of NIL compensation will be based upon where the student goes to school (as opposed to his/her state of residence). Particularities abound. For example, student athletes in Alabama, Florida, Tennessee, and Texas must take a course in financial literacy; in Colorado the student-athlete must disclose any NIL agreement to the school’s athletic director; in Georgia 75% of compensation earned must be held in an escrow account; in Mississippi boosters are prohibited from providing NIL compensation to student athletes; in Montana NIL activities are prohibited on campus; and New Jersey and Tennessee prohibit endorsements in such activities as alcohol, gambling, and firearms.

For now, if you are interested in signing a student athlete for an endorsement deal, the landscape is promising, but still as confusing and crazy as a football game led by the Marx Brothers.

Topics: Endorsement