NCAA votes to accept $2.8 billion antitrust settlement

NCAA and Big Ten Conference leadership on Wednesday approved a $2.8 billion settlement of antitrust claims, bringing college athletics closer to some of the most dramatic changes in its history.

What you need to know

The NCAA approved a $2.8 billion settlement that would resolve three antitrust lawsuits

If the judge signs the agreement, it would allow schools to share the proceeds with their athletes

This would be a major change to the amateur sports model established by the NCAA for college athletics

The NCAA will pay $2.77 billion over 10 years to former and current college athletes who were denied endorsements or sponsorship deals dating back to 2016.

The NCAA and conferences would establish a system that allows, but does not require, schools to spend approximately $21 million annually on their athletes

The proposal could resolve three major antitrust lawsuits against the NCAA that carry the threat of multibillion-dollar damages, a blow that would cripple the organization founded in 1906 that oversees about 500,000 athletes in dozens of sports.

If approved by a judge, it would further upend the NCAA’s long-standing amateur sports model by allowing schools to share revenue with their athletes, who were allowed to start earning sponsorship money less than three years ago.

The NCAA completed its approval process late Wednesday, and its 15-member Board of Governors voted unanimously to adopt the plan – with one abstention – according to two people with direct knowledge of the vote who spoke to The Associated Press on the condition of anonymity because the NCAA did not she revealed her inner process publicly.

Attorneys for the plaintiffs in House v. NCAA have set a Thursday deadline to reach a settlement agreement, with votes from the presidents of the Southeastern Conference and Pac-12 expected later in the day. The Big 12-Atlantic Coast Conference has already signed the agreement, and Big Ten presidents joined them on Wednesday, a person with direct knowledge of the decision told the AP, speaking on condition of anonymity because the conference did not make internal discussions public.

Under the proposed settlement, the NCAA will pay $2.77 billion over 10 years to former and current college athletes who were denied the opportunity under now-defunct rules to earn money from endorsement and endorsement deals dating back to 2016. The NCAA and conferences also agree to establish a revenue-sharing system under which schools could, but did not have to, spend about $21 million a year on their athletes. This number may increase over time if revenues increase.

As the league and NCAA marched toward a settlement, a fourth antitrust case presents a potential complication.

U.S. District Judge Charlotte Sweeney in Colorado ruled Thursday that the Fontenot v. NCAA case will remain in her court rather than be moved to California and merged with one of the other antitrust lawsuits that could be included in the settlement.

An attorney for the plaintiffs in Fontenot said they won’t know whether their claims will be covered by the settlement until they know all the details of the proposal.

“One way or another, they’re going to have to cooperate with us, otherwise I just don’t see how there’s going to be a settlement in the end,” George Zelcs, one of the plaintiffs’ lawyers, told the AP. “They must either include us or receive an order that requires our involvement. We also have arguments against all this.”

The NCAA and five conferences named in the House of Representatives’ lawsuit against the NCAA that are the subject of settlement talks asked Sweeney to combine the Fontenot case with Carter v. NCAA, which is pending in the Northern District of California.

The House and Hubbard v. NCAA cases have already been consolidated in the Northern District of California and are being overseen by U.S. Judge Claudia Wilken, who has ruled against the NCAA in several high-profile antitrust cases in recent years. Carter is being supervised by U.S. judge Richard Seeborg. Fontenot will be added to Seeborg’s affairs.

Former Colorado football player Alex Fontenot filed a lawsuit last November, alleging that NCAA rules illegally prevent college athletes from earning their fair share of the millions of dollars given to them by schools. Garrett Broshuis, Zelcs’ colleague at the law firm Korean Tillery, said the Fontenot case should not be combined with the other three.

“House focused on name, image and likeness issues, which actually represent only a small portion of the overall revenue brought in by the NCAA and its conferences and their members,” Broshuis told the AP. “Instead, we focus on what the true free market value of the services these athletes provide would be.”

Broshuis said Carter’s case focuses solely on basketball and football players from Power Five conferences – the ACC, Big Ten, Big 12, Pac-12 and SEC.

“While the class proposed by Fontenot is broader. Revenue is revenue, regardless of the sport,” he said.

Steve Berman, one of the House’s top lawyers, said in a statement to the AP that the issues in Fontenot are entirely consistent with the other cases and that the settlement, if approved, “will discharge all of their claims.”

“And as for their claim, they are waiting to see if they want to participate, they have already filed objections in court in Colorado without even reviewing the contract, which is completely irresponsible behavior,” Berman said. “Especially because they didn’t contribute to the momentum that allowed us to achieve this, unlike how Johnny came along recently.”