The NCAA and its top five conferences have proposed paying about $3 billion to former athletes to settle a class-action antitrust lawsuit.
The proposed agreement would regulate payments from boosters while also paving the way for schools to directly compensate athletes.
“NCAA college athletes have waited decades for this moment, and now they are finally entitled to receive the full value of their hard work,” said Steve Berman, co-founder and managing partner of the law firm Hagens Berman. “We are incredibly proud to be in the final stages of this historic change.”
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Trophies and banners on display at the NCAA Division III Women’s Ice Hockey Championship at Kenyon Arena on March 19, 2022 in Middlebury, Vermont. (Photo by Nancy Battaglia/NCAA via Getty Images)
“College athletes will finally be able to share in the billions of dollars that their compelling stories and dynamic performances have generated for their schools, conferences and the NCAA,” the lawsuit states. “After more than four hard-fought victories in this litigation, this represents a truly seismic change for college sports.”
The $2.78 billion will be paid out over 10 years, with payments based on sport and length of career, with most football and men’s basketball players receiving about $135,000 each.
However, the law firm said the maximum estimated payout is expected to be closer to $2 million due to “NIL opportunity costs.”
Nathan Mensah, No. 31 of the San Diego State Aztecs and Adama Sanogo, No. 21 of the Connecticut Huskies jump for the ball to start the game during the NCAA men’s basketball tournament national championship game at NRG Stadium on April 3, 2023 in Houston, Texas. (Logan Leary/Getty Images)
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The deal covers three antitrust lawsuits, including a class-action lawsuit known as House v. NCAA, that challenged the NCAA’s compensation rules dating back to 2016. Plaintiffs argued that the NCAA’s rules denied thousands of athletes the opportunity to make millions of dollars from the use of their names, images and likenesses.
In 2021, the NCAA lifted its ban on athletes earning income through sponsorship deals and endorsements.
The agreement doesn’t resolve the issue of whether college athletes should be considered employees, but it includes language suggesting the agreement could be modified if “changes in the law or circumstances permit collective bargaining.”
“While this settlement is an important step forward for student-athletes and college sports, it does not address all challenges,” the commissioners of the Atlantic Coast Conference, Big Ten, Big 12, Pac-12 and Southeastern Conference, along with NCAA President Charlie Baker, said in a joint statement. “The need for federal legislation to provide a solution remains. Unless Congress acts, the progress made through the settlement could be significantly undermined by state legislation and continuing litigation.”
The NCAA logo is displayed on a basketball pad before a game between the Marquette Golden Eagles and the Colorado Buffaloes in the second round of the NCAA men’s basketball tournament at Gainbridge Fieldhouse on March 24, 2024 in Indianapolis, Indiana. (Mitchell Leighton/Getty Images)
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The application still needs to be approved by a judge, but the lawyers have filed a motion for preliminary approval and say if approved, a public website could be launched within about two months where former college athletes could see how much they’re eligible to receive.
The Associated Press contributed to this report.
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