NCAA and Power Five approve antitrust settlement, paving the way for college athletes’ revenue model

The National Collegiate Athletics Association (NCAA) and the nation’s five largest conferences have approved an antitrust settlement worth nearly $2.8 billion, paving the way for a new revenue-sharing model that is expected to increase pay for student-athletes.

NCAA President Charlie Baker, in a joint statement with the commissioners of the Atlantic Coast Conference, Big Ten, Big 12, Pac-12 and Southeastern Conference, confirmed Thursday that they had agreed to terms that would resolve a series of antitrust claims against them.

“The five autonomy conferences and the NCAA’s agreement to the terms of the settlement are an important step in the ongoing reform of college sports that will provide benefits to student-athletes and ensure transparency in college athletics across all sports for years to come,” the statement said.

Terms have not been publicized, although multiple media outlets have reported that the settlement is approximately $2.77 billion to be distributed over 10 years to more than 14,000 former and current college athletes who were unable to benefit from sponsorship deals and support dating back to 2016. .

If approved, the deal is expected to dramatically change the revenue-sharing model for school athletic departments, allowing students to receive salaries more like professional athletes and schools to compete for talent through direct payments, the Associated Press reports.

“This landmark settlement will bring college sports into the 21st century, and college athletes will finally be able to receive their fair share of the billions of dollars in revenue they generate for their schools,” said Steve Berman, one of the lead lawyers for the plaintiffs, according to the AP. “Our clients are the backbone of the NCAA’s multi-billion dollar business and can finally be fairly compensated for their extraordinary athletic talents.”

In 2021, the NCAA lifted its previous ban on allowing student-athletes to earn money from their name, image and likeness (NIL) after the U.S. Supreme Court ruled that limits on student-athlete compensation violated the Sherman Act, the Act antitrust.

The AP noted that the new compensation model would allow, but not require, each school to allocate up to $21 million in revenue annually to athletes. Athletes in all sports will be eligible for the payments, and schools will be able to determine how to divide the funds among sports programs.

The deal, which still must be approved by a federal judge, comes in response to three antitrust lawsuits that sued the NCAA for failing to provide compensation for its use of NIL.

The House v. NCAA case — the case at the heart of the settlement — was scheduled to go to trial in January, before settlement talks intensified. The agreement reached this week is expected to cover two other antitrust cases against the NCAA and major conferences, the AP reports.

The controversy over NIL compensation has intensified on Capitol Hill in recent years, and since 2020, at least seven bills have been introduced in the House or Senate to address compensation policy standards. None of them were successful.

Earlier this month, Republican Reps. Russell Fry (S.C.) and Barry Moore (Ala.) introduced the Protect the Ball Act, which would “provide new benefits to student-athletes, establish and enforce rules, and uphold the law without the ongoing risk of costly litigation.”

In addition to the NIL damages cases, the NCAA is separately grappling with state lawsuits over some of the association’s policies, including recruiting incentives and multiple transfers.

Fry and Moore’s proposed bill seeks to protect the NCAA from litigation and establish federal barriers to protect athletes’ compensation for their NIL, recruiting and eligibility standards.

The Associated Press contributed to this report.

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