NCAA releases details of proposed $2.78 billion settlement with former athletes

The NCAA and five of its largest conferences have filed a lawsuit seeking nearly $3 billion to former athletes as part of a class-action antitrust settlement.

The proposed agreement also clears the way for schools to pay athletes directly while trying to regulate payments from sponsors.

“NCAA athletes have waited decades for this moment, and their right to receive the full value of their hard work has finally arrived,” said Steve Berman, managing partner and co-founder of the law firm Hagens Berman. “We are incredibly proud to be on the cusp of this historic change.”

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“College athletes will finally be able to share in the billions of dollars their compelling stories and dynamic performances have generated for their schools, conferences and the NCAA,” the filing reads. “This is nothing short of a seismic shift in college sports after more than four years of hard-fought victories in this matter.”

$2.78 billion will be paid out over 10 years. Payouts will be determined by sport and length of playing career, with most football and men’s basketball players eligible for nearly $135,000 each.

However, the law firm said the highest estimated payout is expected to be nearly $2 million, thanks to “lost NIL opportunities.”

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The agreement includes three antitrust cases — including a class action lawsuit known as House vs. the NCAA — that challenged the NCAA’s compensation rules dating back to 2016. The plaintiffs argued that the NCAA rules deprived thousands of athletes of the opportunity to earn millions of dollars from the use of their names, images and likenesses.

In 2021, the NCAA lifted the ban on athletes earning money through sponsorships and deals with advertisers.

The agreement does not rule on whether college athletes should be considered employees, but it does include a provision that suggests the agreement could be changed if “a change in law or circumstances permits collective bargaining.”

“This settlement is an important step forward for student-athletes and college sports, but it does not resolve all issues,” the commissioners of the Atlantic Coast Conference, Big Ten, Big 12, Pac-12, Southeastern Conference and NCAA President Charlie Baker said in a joint statement. “The need for federal legislation to provide solutions remains. If Congress does not act, the progress made through the settlement could be significantly limited by state laws and ongoing litigation.”

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The application still needs to be approved by a judge, but attorneys say they will file for preliminary approval and, if approved, a public website will be launched in about two months where former college athletes can determine how much compensation they are entitled to.

The Associated Press contributed to this report.

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