The first BIG NIL lawsuit is now here

The Cocktail Party will be the year's second biggest battle between UF and UGA...

Good morning, and thanks for spending part of your day with Extra Points.

Quick housekeeping note, now that I’m allowed to share this. I was in Florida this week for an event at EA Sports, where I was able to interview developers, designers, and yes…play the latest version of Madden and the yet-unreleased College Football 25 video game. I also wore a FOIA AND FIND OUT shirt to EA HQ, which, luckily for me, almost everybody thought was funny.

that’s me!

Anyway, I’d like nothing more than to tell y’all everything I heard and saw, but I have been asked to honor an agreement to not share anything until, uh, the near future. So more details on that trip later this month.

I’ve had my head down at that event for the last few days, but let me try and hit a few other big stories that folks have asked me about…

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The NCAA and major conferences have reportedly approved a House settlement. So now what?

On Thursday evening, ESPN, Yahoo! and others reported that the NCAA Board of Governors, Big Ten, SEC, ACC, Big 12 and Pac-12 all voted to approve a package to settle three massive antitrust cases: House v. NCAA, Hubbard v. NCAA and Carter v. NCAA.

This settlement includes back damages in the neighborhood of $2.7 billion dollars, as well as a mechanism for schools to share tens of millions of dollars in future revenue with athletes.

But don’t look for the biggest brands to open their wallets right this very second. Even if the plaintiff attorneys, NCAA and power leagues all agree to the settlement, Judge Claudia Wilken still needs to actually approve it. According to ESPN, that process will take “months”, and earlier reporting from trade journals suggests that there is a possibility that Judge Wilken could decide to not approve it.

If the settlement is approved, then there’s the question of how many athletes will participate. There is another, completely separate, antitrust case, Fontenot v NCAA, that is not currently part of the proposed settlement package. It is possible that Fontenot could be rolled into House in the future. Steve Berman, co-lead counsel for the athletes, told ESPN he believes the Colorado judge who previously denied a consolidation request may reconsider after seeing the specific House settlement terms. But if the cases remain separate, athletes could opt out of House and sue the NCAA for antitrust violations under Fontenot.

If enough athletes decided to do that, theoretically, it could topple any NCAA antitrust legal peace before it even begins.

None of the four cases also have anything to do with employment classifications of athletes, another area of high legal risk exposure for college sports.

There are still plenty of unanswered questions. How, exactly, will the revenue sharing money be distributed? What schools will opt in to revenue sharing, and by how much? What additional regulatory changes, from roster sizes to NCAA rule enforcement to the operational status of collectives, are coming as a result of this settlement?

And what can smaller conferences, who are furious about their perceived lack of involvement in the discussions, and their disproportionate share of the settlement burden, do about the agreement, now that the NCAA and named defendants have voted? Do they have any recourse or redress?

On one hand, this story is far from over. But on the other, as Yahoo! pointed out, it’s easy to look at the structure of this deal and marvel, given how hard NCAA lawyers fought to keep from having to spend just a few thousand more in educational cost stipends. 

“Amateurism” died sometime in the 1920s, if it ever really existed. But with major conference programs poised to directly pay athletes via revenue sharing, it is now super-duper-mega-ultra-dead.

The first big NIL lawsuit is finally here

A few months after the NIL era really started in 2021, I wrote about the conditions were already ripe for a major lawsuit. Brands, schools and athletes were largely flying blind into deals, often operating without anything resembling a formalized contract. Later, NIL collectives grew in budget, power and influence, and a new cadre of athlete agents, often without law degrees, formal credentials or certifications, flooded the market.

I figured it was only a matter of time before somebody didn’t get what they thought they deserved, and decided to sue over it.

Well, it took a little longer than I expected, but that big ol’ lawsuit is finally here. Former Miami Commit-Turned Florida Commit-Turned Arizona State QB-turned Georgia QB Jaden Rashada is suing the University of Florida and Billy Napier over NIL fraud.

If you aren’t familiar with the story, a TL;DR summary is that Rashada was allegedly promised an enormous NIL package, north of $10 million, if he committed to Florida instead of Miami. Allegedly, after Rashada signed his National Letter of Intent, Florida’s NIL collectives failed to honor their financial commitments, and then sought to renegotiate at a dramatically lower rate. Rasahda then left for Arizona State, and after one season, transferred again to Georgia.

I think it’s pretty unlikely that Florida or Napier face significant NCAA punishment, even though you don’t exactly need to be Encyclopedia Brown to read coverage of this story and suspect that either Napier, or third parties acting on the explicit behalf of Florida football, violated the spirit of NCAA NIL guidelines. As a result of yet another completely different lawsuit, the NCAA suspended active investigations into NIL rule violations. With so much up in the air from House and governance reform tied to those settlements, it could be a long time before anybody from Indianapolis issues any sanctions.

But there are other forces that can punish either party here beyond the NCAA.

For one, there’s the court of public opinion / the marketplace. Florida, a school that is not supposed to ever go 5-7, went 5-7 last season…and just so happens to have one of the hardest schedules in the entire country this season. Look at this!

Good God

One way to make sure that you don’t have the political and culture capital to survive back to back 5–7 seasons at Florida is to also get yourself roped into an embarrassing lawsuit that insinuates that your program is both sloppy AND poor. Florida’s 2025 recruiting class currently sits at 44, below schools like Iowa, Rutgers, Minnesota and Cal.

There’s also the potential cost of either settling this case, or going to trial. I’m going to make a wild guess here that Florida and any entities associated with Florida Gators recruiting would prefer to not go to the discovery phase of any recruiting related litigation. But if Rashada was really offered $13 million and change to come to Florida, with an NFL career somewhat in doubt now, he’d have every incentive to push hard to maximize what he can get from a lawsuit.

The fact that all of this is happening while Rashada is currently on the roster of one of Florida’s biggest rivals is just…*chef’s kiss*. College football perfection.

The idea of collectives (with the explicit blessing of a school or not) failing to keep their financial promises is not a new story, even if it’s becoming a less common one, now that collectives are more professionalized and standardized than they were two years ago. The idea of potential fraud at this scale, at this amount of money, at these programs, with these uh, college sports industry side characters involved…is new.

I don’t know how the story will end. But I feel pretty confident it’s going to get loud, and probably very stupid, before it concludes.

Here’s what else I wrote this week:

I’m about to do things like travel to Orlando for a few days, write a computer game and write all these newsletters, because of the support of our sponsors, and from subscribers like you. If you want to make sure you get every Extra Points newsletter, including everything about EA CFB25, consider an upgrade to a paid subscription.

I’ve got a few meetings this morning and then will fly back to Chicago. I’ll see you all on the internet next week.

This newsletter is brought to you by Teamworks:

Teamworks, the leading technology provider for collegiate athletic departments, will launch Teamworks Wallet this summer. Teamworks Wallet (“Wallet”) is a digital banking solution built specifically for athletic departments and student-athletes. Trusted by over 700 NCAA institutions and 1,000 elite sports organizations worldwide, Teamworks is uniquely positioned to deliver a centralized destination for student-athletes to receive, store, and spend their money.

At launch, Wallet will integrate with Teamworks Influencer to streamline NIL payments for student-athletes. This integration allows collectives, businesses, and donors to quickly transfer funds directly into student-athletes' Wallet accounts without incurring any fees from Teamworks.

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