NCAA could pay more than $2.7 billion to settle antitrust suits, sources say

The NCAA’s national office may have to foot the bill for a settlement expected to exceed $2.7 billion in the landmark House v. NCAA lawsuit and other related antitrust cases, in hopes of reshaping the college sports industry and stabilize, according to multiple sources on Thursday.

Sources told ESPN this week that parties have proposed that the NCAA’s national office — rather than the individual member schools or conferences — would pay to settle past damages over a 10-year period. The NCAA payments would be paid to former college athletes who say they were illegally prevented from making money by selling the rights to their name, image and likeness.

The settlement would come with a corresponding commitment from conferences and schools to share revenue with future athletes, per the source. The settlement would create a framework for power conferences to share revenue with their athletes in the future. Sources have told ESPN that schools expect a ceiling of nearly $20 million per year on athletes’ revenue share. (That revenue share figure is derived from a formula that is expected, per source, to be 22% of a revenue statistic that is still being discussed and will be based on different revenue categories. It’s up to the schools to share that much.)

The dollar’s value and timing, sources warn, are not yet set in stone and could change due to the myriad variables involved.

Steve Berman, co-lead counsel for the plaintiffs, told ESPN he believes the House case is “the difference maker” after more than a decade of legal battles to undermine the NCAA’s rules. Berman declined to comment on the details of the ongoing settlement talks, but said the plaintiffs’ leverage increases as the case moves closer to trial.

“Our influence is a big cannonball rolling down a hill and picking up speed,” Berman said. “The longer they wait, the more they have to pay. It’s that simple.”

The NCAA declined to comment.

Since a group of collegiate sports and NCAA officials met with plaintiffs’ attorneys at the Hyatt Regency at the Dallas-Fort Worth Airport on April 25, details for a possible settlement of the House case have been circulating among campuses. After interviews with more than a dozen university officials, industry sources and attorneys this week, ESPN has learned that many details crucial to a settlement remain unresolved, but that both sides are making progress toward a deal that could serve as a catalyst for the new business model. of college sports.

“They have things in writing,” said an industry source. “This isn’t just lawyers and commissioners meeting and having a cocktail. This is snowballing downhill. The horizon of this is about a month.”

Plaintiffs in the House case allege that the NCAA is violating the law by imposing restrictions on how athletes make money from their name, image and likeness. The case is expected to go to trial in January 2025. If the NCAA loses the case at trial, it could owe athletes more than $4 billion in damages.

In addition to saving money, the NCAA is also motivated to settle in hopes of laying the groundwork for a system that could help them avoid future lawsuits. A settlement alone might not provide that protection without additional help from Congress or a collective bargaining agreement with athletes.

The NCAA and its conferences are defendants in at least two other federal antitrust cases that challenge the rest of the association’s amateurism rules. These outstanding cases would also likely be resolved as part of the settlement in the House of Representatives.

Earlier this month, the plaintiffs filed a motion for summary judgment, asking the judge in the case to rule on a number of key arguments before trial. The summary judgment hearing is scheduled for September, and a ruling in favor of the plaintiffs could further increase their leverage in the negotiations.

One of the outstanding issues in the potential settlement of the case in the House of Representatives is whether or not a settlement would eliminate future antitrust lawsuits against the NCAA and its schools.

“I’m very concerned about the fact that a settlement is not actually a settlement,” an industry source told ESPN of looming issues that need to be resolved before a settlement is reached. ‘It does not provide sufficient protection. If it were a comprehensive settlement with congressional approval, I would feel a lot better.”

College sports leaders have been asking Congress for several years to write a new federal law that, among other things, would protect them from future lawsuits.

Sources told ESPN that some school officials hope a settlement in the House of Representatives could lead to action on Capitol Hill. Several members of Congress who have worked on college sports-related legislation in recent years declined to comment on the impact a settlement could have on the creation of a new federal law.

Now that information has been brought back to campuses, the biggest concern is how protective the settlement would be against future antitrust lawsuits.

“You can’t just settle the lawsuits,” said another industry source. ‘You have to be able to get something in return, other than the settlement. If you do not have the required capacity to structure the future. All we’re going to do is shake hands and wait five minutes for the next request. You don’t want to be here waiting for the next trial.’