The Death of Amateurism – Implications of the Proposed House Settlement for the Future of College Sports

ADDENDUM (Updated December 30, 2024)

By Erica Hamilton

This is guide is meant to serve as an Addendum to the “Death of Amateurism: Implications of the Proposed House Settlement for the Future of College Sports,” that was last updated on September 5, 2024. The Addendum will cover the following topics:
• September 5, 2024: Judge Wilken Withholds Preliminary Approval (pg. 1)
• September 26, 2024: Revised Settlement Filed (pg. 1)
• October 7, 2024: Preliminary Approval Granted (pg. 3)
• Timeline for Final Approval (pg. 3)
• Implications for Conflicting State Laws (pg. 4)
• Attorney Fees and Class Representative Compensation (pg. 5)
• Coaching Implications from College Athletics’ Shifting Landscape (pg. 5)
• Updates to Objections (pg. 5)
• Employment Status and Legislative Updates (pg. 6)
• Private Equity Investment in College Athletics: Key Points (pg. 7)
• Future College Football Models (pg. 8)
• Future Legal Challenges Facing the NCAA (pg. 9)

September 5, 2024: Judge Wilken Withholds Preliminary Approval
• On September 5, 2024, Judge Wilken held a hearing to review the proposed settlement terms and consider granting preliminary approval. While expressing general support for the settlement, Wilken raised concerns about specific provisions.
• In particular, the settlement contained provisions that restricted payments to student-athletes from Booster-run collectives. As a result of this, Wilken found the definition of “Booster” too broad, fearing it left room for interpretation and could harm student-athletes with existing NIL deals. She urged attorneys to revise the proposal, emphasizing the need to safeguard NIL opportunities for college athletes and avoid undermining the NIL market. Wilken stressed the importance of drawing clearer distinctions between boosters and legitimate businesses interested in NIL deals.

September 26, 2024: Revised Settlement Filed
• On September 26, 2024, attorneys in the House settlement submitted a revised proposal with a supporting brief addressing Wilken’s earlier concerns.
• The updated settlement limits enforcement authority over third-party NIL deals, focusing on a narrower group of entities and individuals closely tied to schools and what constitutes the pay-for-play inducements the NCAA is aiming to eliminate. Specifically, it defines these parties as:
o “Associated Entities” include (a) entities that are or were known to “the athletics department staff of a Member Institution (NCAA Division I schools), to exist, in significant part, for the purpose of (i) promoting or supporting a particular Member Institution’s intercollegiate athletics program or student-athletes; and/or (ii) creating or identifying NIL opportunities solely for a particular Member Institution’s student-athletes,” and (b) “any entity owned, controlled, or operated by, or otherwise affiliated with, such entity or an Associated Individual, other than a publicly traded corporation.”
 (Covers what is traditionally known as the “Collectives”)
o “Associated Individuals” are those who (a) are or were “a member, employee, director, officer, owner, or agent” of an Associated Entity, (b) “who directly or indirectly . . . have contributed more than $50,000 over their lifetime” to a particular Member Institution or to an Associated Entity, and (c) that “(i) have been directed or requested by a Member Institution’s athletics department staff to assist in the recruitment or retention of . . . student-athletes, or (ii) otherwise has assisted in the recruitment or retention of . . . student-athletes.”
 (Covers what is traditionally known as “Boosters”)
• The Clearinghouse
o Under the proposal, the NCAA and power conferences will establish a “designated enforcement agency” to evaluate whether third-party NIL deals reflect fair market value and qualify as legitimate NIL arrangements. Key provisions include:
 College athletes must report NIL contracts worth $600 or more to a new clearinghouse database.
 Deals deemed pay-for-play inducements would be denied or require amendments, with penalties for non-compliance.
 For the first time, neutral arbitration would be available to challenge NCAA enforcement actions, ensuring the NCAA is no longer the sole prosecutor, judge, and jury.
• Relevance and Context
o The NCAA argues that the revised settlement would help prevent disputes like the recent case involving UNLV quarterback Matthew Sluka. Sluka claims he was verbally promised a $100,000 NIL contract, but received only a $3,000 relocation stipend. UNLV and its affiliated NIL collective deny a formal NIL agreement was made. Sluka has since announced plans to redshirt and enter the transfer portal over the dispute.
o Other notable examples highlight concerns about “pay-for-play” inducements:
 AJ Dybantsa, the No. 1-ranked high school basketball player in the 2025 class, committed to BYU over UNC, Kansas, and Alabama. Reports suggest BYU’s NIL offer is close to $7 million. Dybantsa is expected to declare for the NBA draft after one year, potentially making $7 million the highest annual NIL figure reported.
 The Michigan Wolverines reportedly secured Bryce Underwood’s commitment with NIL funding from a billionaire booster. Originally committed to LSU, Underwood was rumored to have a $1.5 million annual offer for four years. Michigan countered with a deal valued at $10 million, with some estimates suggesting he could earn up to $12 million in Ann Arbor.
o These cases have sparked debate. Some view lucrative NIL deals as the new norm and a recruiting tool, while others worry they could undermine the integrity of college sports.
o Many schools are scrambling to secure substantial deals through their Collectives—potentially classified as “pay-for-play”—before enforcement measures by the Clearinghouse take effect in July 2025. This strategy, often referred to as “front-loading,” exploits the current window where such payments will not count toward the cap. “It’s the one year you can manipulate the cap,” noted Alford, the athletic director at FSU.

October 7, 2024: Preliminarily Approval Granted
• On October 7, 2024, Judge Wilken preliminarily approved the settlement, finding it fair, reasonable, and adequate under Federal Rule of Civil Procedure 23. However, she emphasized that preliminary approval does not guarantee final approval, which could face further scrutiny.
• Wilken scheduled a fairness hearing for April 7, 2025, where athletes, schools, and conferences can raise objections or submit written comments. If persuasive objections arise, Wilken may deny final approval and request further revisions.
• It is important to note that schools outside of the “Power Four” conferences are not required to contribute funds associated with the future revenue share proposed by the settlement. However, those that choose to participate will be bound by the settlement’s terms and conditions. For example, Ivy League schools may opt out of participation and will not be bound by the rules that accompany the settlement.

Timeline for Final Approval
• October 18, 2024 – January 31, 2025: The claims period for eligible class action members. Eligible class action members include (a) Division I student-athletes who were eligible for competition between June 15, 2016 and September 15, 2024 and student-athletes who will compete on a Division I athletic team any time from the fall of 2025 and 10 years thereafter under House v. NCAA; and (b) Hubbard v. NCAA class action members, including Division I student-athletes who were eligible for competition between April 1, 2019 and September 15, 2024 who would have met the requirements for receiving an Academic Achievement Award under the criteria established by their schools for qualifying for such an award.
• December 17, 2024: Estimated allocation amounts released, providing projections of monetary settlements.
• March 3, 2025: Responses to objections and opt-outs are due.
• April 7, 2025: Final approval hearing, coinciding with the NCAA Men’s March Madness final.
• Should Athletes Opt-Out of the Settlement?
o Athletes should be aware that they cannot opt-out of the injunctive relief settlement, which pertains to the future revenue-sharing framework. While athletes are permitted to submit objections and comments, once the settlement receives final approval, the injunctive relief tied to future revenue sharing will remain in effect for the next 10 years. Conversely, athletes do have the option to opt-out of the back pay damages portion of the settlement, allowing them to pursue individual claims for damages.
o For those considering alternatives, opting-out could enable them to pursue claims through another pending lawsuit, Fontenot v. NCAA, which is an antitrust case currently in Colorado federal court. The Fontenot plaintiffs not only seek third-party NIL damages but also advocate for revenue sharing above and beyond what is addressed in the current settlement.
o Evaluating the Settlement’s Benefits and Drawbacks
 There is some uncertainty about how the settlement benefits college athletes in the long term. Schools are not required to pay players directly through revenue sharing, and no guaranteed payment floor has been established. Additionally, roster spots are being reduced, and there appears to be an effort to limit the influence of collectives.
 The NCAA also gains mechanisms to challenge what it views as illegitimate NIL deals, which could curb opportunities for athletes. Furthermore, the NCAA’s strengthened position may give it greater leverage to seek Congressional intervention, potentially reinforcing its authority and limiting athletes’ bargaining power moving forward.
Implications for Conflicting State Laws
• Four lawmakers behind college NIL bills in California, Nebraska, and Oregon are challenging the compatibility of the settlement with the laws they authored.
• State Sens. Nancy Skinner (D-Calif.), Steven Bradford (D-Calif.), Megan Hunt (I-Neb.), and James Manning Jr. (D-Ore.) released an embargoed statement, coordinated with the National College Players Association (NCPA).
o They argued that key provisions in the House settlement violate their statutes by imposing restrictions on NIL payments from athletic boosters and collectives.
o Current NIL laws in California, Nebraska, and Oregon, among others, explicitly prohibit schools from complying with NCAA or conference rules that restrict donor and collective participation in player compensation. Additionally, California, Georgia, Illinois, and Virginia permits schools to engage directly in NIL deals with athletes.
• Attorney Jeffrey Kessler countered these claims while speaking at SBJ’s Intercollegiate Athletics Forum, calling the lawmakers’ and NCPA’s arguments misleading and inaccurate. He clarified that the House settlement does not require schools to take any specific actions, but instead allows them to decide whether payments would comply with state laws, in the same way they need to make sure they comply with Title IX.
Attorney Fees and Class Representative Compensation
• Lawyers for the plaintiffs in House v. NCAA are seeking approximately $484 million in fees, along with an additional 1% of future revenue shared with athletes under the settlement—potentially adding another $200 million. Meanwhile, the class representatives in the antitrust case—Grant House, Tymir Oliver, and Sedona Prince—are each requesting $125,000.
Coaching Implication from College Athletics’ Shifting Landscape
• Since the NCAA’s 2021 rule change allowing athletes to profit from their NIL, a wave of veteran coaches in men’s football and basketball have stepped away from the game.
• The most recent example is Jim Larrañaga, who retired from coaching men’s basketball at the University of Miami, citing exhaustion and the challenges of competing in the evolving environment as reasons for stepping away. His sentiments echo those of other prominent basketball coaches—Duke’s Mike Krzyzewski, North Carolina’s Roy Williams, Virginia’s Tony Bennett, and Syracuse’s Jim Boeheim—all of whom retired in the wake of NIL changes.
• On the football side, Nick Saban’s unexpected retirement sent shockwaves through the sport. Reflecting on the shift, he stated:
o “Our program was always built on creating value for players’ futures—personal development, academic success, and NFL careers. But maybe this doesn’t work anymore. The goals and aspirations seem different now; it’s all about how much money I can make as a college player. I’m not saying that’s bad or wrong, but it’s not what we were about.”
Updates to Objections
• Ongoing Concerns: Recent objections highlight lingering issues with compensation limits and revenue distribution under the revised settlement. Many of the antitrust and labor law conflicts that prompted these objections—and continue to drive new lawsuits—are likely to resurface in upcoming filings.
• Pending Objections:
o Fontenot v. NCAA & Cornelio v. NCAA:
 Attorneys for these two pending lawsuits argue that combining negotiations for past damages and future revenue-sharing creates a conflict of interest, potentially prioritizing lucrative damages over fair revenue-sharing terms. They’ve requested separate legal representation for different athlete groups to ensure balanced advocacy.
o Former Division I Rowers:
 On August 9, 2024, former Yale crew captain Grace E. Menke and five other rowers objected to the settlement, claiming it disproportionately favors male athletes by allocating most funds to football and men’s basketball while offering minimal compensation to female athletes.
o O’Bannon Attorneys:
 Attorneys from Hausfeld LLP, who successfully represented Ed O’Bannon in antitrust and IP litigation against the NCAA, filed an opposition to the plaintiffs’ amended motion for preliminary settlement approval on behalf of seven current and former college athletes.
 The objectors argue that the $2.7 billion damages amount undervalues athletes’ NIL earnings by $3.8 billion, citing inflation-adjusted estimates of $6.4 billion, and criticize the 22% revenue-sharing cap as unreasonably low compared to the 50% typical in professional leagues. They contend the settlement violates state NIL laws, unfairly burdens smaller Division I programs, and limits NIL collectives by shifting control to schools and the NCAA. Additional concerns include replacing guaranteed NIL payments with uncertain future arrangements, enabling collusion to suppress athlete compensation, and locking athletes into a 10-year plan despite rising pay trends.
 Objectors further accuse the NCAA of using the settlement to pursue federal antitrust immunity and obstruct labor law advancements, such as unionization and employee classification efforts—ultimately prioritizing institutional control over athletes’ rights.
• Withdrawn Objection:
o Ivy League Lawsuit Plaintiffs:
 Two Brown University athletes, Tamenang Choh and Grace Kirk, withdrew their opposition after assurances that the settlement wouldn’t affect their antitrust claims against Ivy League schools. However, their lawsuit was later dismissed for failing to adequately identify a relevant market for antitrust scrutiny.
Employment Status and Legislative Updates
• Plaintiffs’ Push for Players’ Association:
o The named plaintiffs sent a letter to Judge Wilken requesting recognition of a players’ association, potentially organized by Athletes.org, to advocate for athlete interests.
o While non-union advocacy groups like Athletes.org and the College Football Players Association can support licensing deals and provide a collective voice, they currently lack the legal authority to collectively bargain—limiting their ability to address antitrust issues tied to compensation.
o Establishing such an association would likely require athletes to first be classified as employees, a determination still pending in Congress, the courts, or through the National Labor Relations Board.
• NCAA’s Legislative Goals:
o The NCAA seeks legislation to:
 (1) Clarify that athletes are not employees but allow them to collectively bargain.
 (2) Establish a uniform national NIL standard to replace inconsistent state laws.
 (3) Secure a limited antitrust exemption, such as that of MLB, to enforce rules without facing constant litigation.
• Impact of Political Changes:
o Recent election results pose challenges for athlete-employee advocates, as Republican lawmakers—historically less supportive of employee status—gained influence. Sen. Ted Cruz (R-Texas), poised to chair the Senate Commerce Committee, has proposed legislation protecting the NCAA’s antitrust immunity and classifying athletes as non-employees. Similarly, Sen. John Thune (R-S.D.), the incoming Senate majority leader, supports safeguarding amateurism and limiting professionalization of college sports, a best-case scenario for the NCAA.
• Future Outlook:
o While GOP control could hinder legislation granting employment rights to athletes, legal and regulatory debates remain active. Analyst Michael McCann has outlined reasons why this shift may not completely derail efforts to classify athletes as employees, signaling that the issue remains far from settled.

Private Equity Investment in College Athletics: Key Points
• Non-Ownership Model: Private equity (PE) in college athletics is not likely to involve buying shares, majority control, governance authority, or board seats (that which is typical when you think of “equity”). Instead, it focuses on providing financial and strategic support without taking ownership of athletic departments.
• Long-Term Partnerships: Unlike traditional PE models with short-term ownership (3–5 years), these investments will form 15–20-year relationships with schools, emphasizing long-term stability and growth.
• Revenue Growth and Cost Management: PE investments aim to help schools increase revenues and control costs, offering expertise and strategies to adapt to the rapidly changing college sports landscape and maintain competitive balance.
• Broader Revenue Control: Unlike companies like Learfield and Playfly, which focus on multimedia rights and annual revenue advances, PE investors plan to manage multiple revenue streams—including media, licensing, sponsorships, and merchandising—potentially bundling them into assets for greater value and flexibility.
• Survival and Competitive Success: With schools needing to balance rising costs and competitive pressures, PE partnerships could provide critical financial stability, ensuring the long-term sustainability of college athletics programs.
Future College Football Models
• With the proposed shift in college athletics from amateurism to professionalization, several groups have introduced new models for college football— the primary catalyst for these changes. These proposals aim to preserve competitive balance while consolidating media rights to generate the revenue schools need to remain competitive in the post-House settlement era.
• (1) College Student Football League (CSFL) Proposal:
o Overview: College Sports Tomorrow (CST), a coalition of leaders in higher education and sports, has proposed the College Student Football League (CSFL) to restructure college football into a unified, national league focused on sustainability, fairness, and competitive balance.
o Key Features:
 Football-Only Realignment: The CSFL would apply solely to football, while other sports would remain in or return to geographically-based conferences to reduce travel demands.
 Two-Tier Conference System:
• Power 12 Conference for the top 72 FBS programs.
• Group of 8 Conference for the remaining 64 FBS schools, with the top 8 eligible for promotion to the Power 12, but without relegating teams from the top tier.
 Economic Sustainability:
• Centralized operations and revenue streams to fairly compensate players, manage NIL costs, and support non-revenue sports, including women’s athletics and Olympic programs.
 Player Compensation and Rights:
• All football players—not just stars—would receive direct compensation.
• NIL and transfer rules would be collectively negotiated between the CSFL and a player association, ensuring fairness and structure.
 Legal and Labor Framework:
• Supports legislation affirming that student-athletes are not employees but enables collective bargaining to give players a voice and shield the league from antitrust challenges via the non-statutory labor exemption—avoiding the need for federal antitrust immunity.
• (2) Project Rudy/Smash Capital Proposal:
o Overview: Project Rudy, developed by Smash Capital—led by former Disney executives—proposes a 70-team, super-league-style structure focused on maximizing revenue and simplifying college football operations. The plan integrates programs from the four power conferences, expands the postseason, revamps scheduling, and injects up to $9 billion in private equity funding.
o Key Features:
 Revenue Growth Model:
• Centralizes media rights for all 70 teams under a single deal, replacing the current fragmented conference-based packages.
• Emphasizes marquee matchups by eliminating games against lower-tier opponents (Group of Five and FCS) and increasing high-profile games between top programs.
• Projects $15 billion in media and sponsorship revenue over 12 years through expanded playoffs and premium matchups.
 Tiered Revenue Distribution:
• Tier 1 (Top 16 teams): Revenue grows from $130 million per school in Year 4 to $250 million by Year 12—double the current SEC and Big Ten payouts.
• Tier 2 (Next 22 teams): Earnings between $60–$110 million, similar to current SEC and Big Ten rates.
• Tier 3 (Remaining 32 teams): Projections of $30–$60 million, comparable to Big 12 and ACC payouts.
 Private Equity Investment Structure:
• Establishes a for-profit “league” that retains 5–12.5% of new revenues after guaranteeing schools’ current media distributions.
• Media deals, negotiated centrally after current contracts expire (in 7–10 years), allow networks and Smash Capital to own equity in the league, aligning long-term incentives.
o Economic and Structural Impact:
 By leveraging private equity, consolidating media rights, and focusing on high-value matchups, Project Rudy aims to sustain competitive balance, stabilize athletic budgets, and fund athlete compensation—ensuring long-term viability amid rising costs and NIL demands.

Future Legal Challenges Facing the NCAA
• Even if the House settlement is approved, the NCAA’s legal battles are far from over, as multiple lawsuits continue to challenge its policies, practices, and governance.
• Ongoing Lawsuits and Legal Risks:
o Reggie Bush Lawsuit:
 Former USC Heisman winner Reggie Bush sued the NCAA, USC, and the Pac-12, alleging they profited unfairly from his NIL without compensation, even after he left USC.
 Bush accuses the defendants of unjust enrichment and unfair trade practices, but the NCAA argues the lawsuit is untimely, citing expired statutes of limitations.
o South Dakota Attorney General Lawsuit:
 South Dakota’s Attorney General, Marty Jackley, filed a lawsuit challenging the House settlement.
 The complaint alleges the NCAA violated its contract with member institutions, breached fiduciary duties, and distributed funds inequitably between male and female athletes, potentially violating Title IX.
o Diego Pavia Eligibility Lawsuit:
 Vanderbilt quarterback Diego Pavia successfully sued the NCAA, proving once again that they are not above the law. He secured an additional year of eligibility and the opportunity to earn up to $1 million in NIL deals.
 Pavia’s case, citing violations of the Sherman Act, argued NCAA eligibility rules unlawfully restricted interstate trade, leading to broader eligibility changes for athletes who transferred from non-NCAA schools.
o Ex-College Basketball Players NIL Lawsuit:
 Sixteen former players, including Mario Chalmers and Jason Terry, sued the NCAA, conferences, and Turner Sports for unauthorized use of their NIL in March Madness broadcasts.
 The NCAA contends the claims are barred by statutes of limitations, but the case underscores persistent disputes over past NIL usage.
• Key Takeaways:
o An approved settlement will not resolve all of the NCAA’s legal battles, which is why the organization will continue to pursue Congressional antitrust exemptions and federal NIL legislation.
o A House settlement would not necessarily supersede the federal ruling in Tennessee and would need member institutions to adhere to the settlement terms to be most effective. It also wouldn’t protect against possible Title IX complaints, employment status and collective bargaining efforts or other antitrust litigation.