What is the House settlement?
The House settlement is the combined settlement (i.e. agreement between the parties) of three federal antitrust class action lawsuits brought against the NCAA and the Power 5 conferences. Each lawsuit alleged in various ways that the NCAA’s restrictions on the monetization of student-athletes’ name, image, and likeness (NIL) prevented the Plaintiffs therein from earning their true market value during their amateur careers.
How much money is involved in the settlement?
$2.8 billion in damages will be paid out over a ten-year period to certain current and former college student-athletes who did not have the opportunity to earn compensation for their name, image, and likeness (NIL).
In addition, as a result of the settlement, Power 5 schools may now share the revenue they earn from athletics with their student-athletes, with that revenue coming from media rights, ticket sales, and sponsorships. Power 5 universities can pay 22% of the specified revenue to student-athletes; that amount will increase by 4% in the second and third years, and then be recalculated every three years after that. The initial projected pool cap is roughly $20.5 million per Power 5 school.
When does the settlement go into effect?
The settlement was previously set to go into effect on July 1st, 2025, but two appeals of the settlement have been filed on grounds that it violates Title IX. These appeals are discussed further below, but until they are resolved, settlement funds will not be able to be disbursed.
What is the new roster limit for gymnastics?
Prior to the settlement, select sports had a cap on the number of student-athletes who could participate, but now roster limits will be in place for all NCAA-sponsored sports, including gymnastics, which will be capped at 20 gymnasts per Division I team. In addition to roster limits, there now will be no cap on scholarships up to the roster limit; that is, each institution can decide how many scholarships to award, up to the total number of roster spots for each sport. Theoretically, all 20 gymnasts could be awarded a full scholarship.
Will gymnasts now be in jeopardy of losing their spots on their teams due to these roster limits?
Judge Wilken specifically requested for the first iteration of the settlement to be revised based on this issue. The settlement that ended up being approved addressed the “grandfathering in” of student-athletes who would have lost their spot on a roster in the 2025-2026 season, due to the immediate (prior to the appeals, on July 1) implementation of the limits. Specifically, per the revised settlement agreement, “any athlete who would have lost their roster spot, or a promised roster spot, for the 2025-2026 academic year due to the immediate implementation of roster limits will be exempt from any roster limits at any Division I institution, for the duration of their college athletics careers.” Those “grandfathered” athletes can either remain with their original school or transfer to a new one; if the latter, they will be permitted to join that team, even if doing so leads to more than 20 gymnasts on the roster.
What about the paying part? Is football just going to get all the money?
With regards to the $2.8 billion in settlement funds, football and men’s basketball athletes who received full scholarships at Power 5 schools from June 15, 2016 to Sept. 15, 2024 will receive 90 percent of the $2.8 billion. This is based off of a calculation of the revenue that could have been earned by those student-athletes during that time based on broadcasting deals and other measures of the “value” of each individual sport.
With regards to revenue sharing, each school will have the autonomy to create its own model; however, some conferences, such as the American Athletic Conference, are issuing directives as to how much money should be paid out and when. It is expected that sports that earn the most revenue for their schools will be paid out more.
Could this lead to more money for gymnasts in the future?
Going off of the above-discussed model of awarding more revenue to student-athletes on revenue-earning teams, in spite of gymnastics’s rising popularity among universities’ fanbases, it would follow that gymnasts might receive less in revenue-sharing if they attend schools with football and basketball programs that earn a huge portion of a school’s revenue. There are exceptions to the rule, though; Oklahoma has already announced that women’s gymnastics will be part of the school’s revenue-sharing program.
Are men’s and women’s sports both impacted?
Yes, and some argue that that impact will be disparate, with more negative impact to women than men. Two appeals have been filed by two groups of female student-athletes, who allege that the disbursement of settlement funds unfairly favors men’s sports, since it is based on revenue data that goes back to years prior to Title IX in which women’s sports were not recognized. The appeals come on the heels of the Trump administration’s rescinding January 2025 guidance on Title IX from the Biden administration that would have required schools to share NIL revenue with male and female athletes on an equal basis
What will happen to NIL and some of the NIL funds/collectives that schools have?
Schools will still be able to sponsor NIL collectives that pay student-athletes, and student-athletes can pursue NIL deals on their own, completely independently of their schools’ revenue-sharing agreements or any settlement funds they may receive. However, any endorsement deal must now be vetted to ensure it is for a “valid business purpose” rather than a recruiting incentive. In addition, deals between student-athletes and NIL collectives will count towards the revenue-sharing cap of $20.5 million, but other deals will not.
The organization that will vet NIL deals, previously identified only as a “clearinghouse,” has now been identified as NIL Go, which will be run by the consulting firm Deloitte. Student-athletes will be required to disclose NIL deals exceeding $600 in total to NIL Go; any disclosed deals that are deemed to be impermissible by the clearinghouse can be challenged by student-athletes through neutral arbitration.
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Article by Katherine Weaver
