August 19, 2022
World Trademark Review
Historically, the National Collegiate Athletic Association (NCAA) has prohibited student athletes from profiting from their name, image, and likeness (NIL) rights through compensation or endorsements, offering them scholarships instead. However, some states have developed legislation to allow students to benefit from the use of their NIL. World Trademark Review contacted Finnegan attorneys Margaret Esquenet and Troy Viger for their thoughts on the issue.
"Twenty-nine states have passed NIL laws since the NCAA’s interim policy went into effect," noted Margaret and Troy. "Common provisions of state NIL laws include preventing schools from withholding player eligibility on the basis of an NIL agreement, preventing colleges from providing NIL compensation as a recruiting inducement, allowing student athletes to hire agents and/or attorneys, and precluding student athletes from entering into NIL contracts that conflict with their school and/or team contracts. Alabama recently became the first state to repeal its NIL law, turning over the policymaking to schools."
Senators Joe Manchin and Tommy Tuberville recently solicited input from university athletic directors, administrators, associations, and student-athlete groups to develop a new NIL bill. Margaret and Troy suggest that the new bill may include similar provisions from bills introduced in the past: "There is a general consensus among each of the bills that student athletes deserve the right to an agent, not affiliated with the school, to help with NIL deals. The proposed bill may include NIL activity disclosure requirements [for instance, that athletes disclose any NIL deal to their school within a given time frame], naming or creating a governing entity to relieve administrative responsibility from the NCAA, and preventing third-party associations from coordinating with institutions or athletic departments in connection with NIL deals."
However, there is no guarantee that the bill will pass. They said, "States may wish to preserve the right to legislate this issue for their own schools and athletes. Moreover, in [the Supreme Court’s National Collegiate Athletic Association v. Alston decision], the Supreme Court ruled that NCAA rules restricting compensation for academic-related expenses violated antitrust law. Thus, the NCAA and other commentators believe any proposed legislation needs to include an exemption for the NCAA from antitrust law to effectively regulate NIL, if such regulation will be left in the NCAA’s hands."
Read “Senators Aim to End “Arms Race of NIL Implementation” but Obstacles Remain”
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