Over the past year, name, image, and likeness (NIL) has been a hot topic for athletes and universities alike. Recently, NIL deals have made headlines, including Miami incoming transfer Nijel Pack signing an $800,000 NIL deal with Life Wallet and a collective supporting the University of Texas paying offensive linemen $50,000. Now, reports are surfacing that the NCAA plans to introduce new rules taking aim at boosters involving themselves in recruiting by offering deals that are essentially “pay for play.” Specifically, the NCAA is concerned about the growing influence of collectives (a collection of boosters that pool resources to offer payments to athletes) and plans to introduce rules that reinforce a booster's role within a university as “representatives of the institution’s athletic interests.” Thus, per NCAA rules, boosters are not permitted to recruit prospective student-athletes. Rather, only institutional staff members can. With new rules set to level the playing field, it is time to review what the NIL landscape looks like in North Carolina. NCAA NIL Policy In July 2021, the NCAA adopted an interim policy that takes a hands-off approach. Under the interim policy, student-athletes, recruits, and schools can do the following: Engage in NIL activities that are consistent with the law of the state where the school is located; If the state does not have an NIL law, engage in NIL activities without violating NCAA rules; and Engage professional services for NIL activities. Importantly, the NCAA has left it to the schools/states to monitor for compliance with state law, which has led to a lack of enforcement due to broad policies/laws and states having no interest in enforcing violations. North Carolina State Law—College Recruits and Athletes The North Carolina General Assembly has yet to pass a bill regarding NIL, which has turned out to be a smart move due to the evolving NIL landscape. (For instance, Alabama actually repealed its NIL law after noting that it was more restrictive than the NCAA’s NIL policy). However, on July 2, 2021, Governor Roy Cooper signed Executive Order No. 223 detailing NIL limitations. Under the executive order, student-athletes can earn compensation for their name, image, and likeness provided such compensation is not a direct inducement to participate in sports at a particular institution or enroll/continue to be enrolled in an institution for participating in sports. Further, student-athletes can contract with representatives as long as they comply with certain laws, including the North Carolina Athlete Agent Act. Notably, North Carolina colleges and universities cannot compensate student-athletes for use of their name, image, and likeness. However, they can impose reasonable limitations on a student-athlete’s ability to receive compensation for their name, image, and likeness. Therefore, within North Carolina’s legal parameters, student-athletes have ample opportunity to earn compensation for their name, image, and likeness. For now, as long as it is not “pay for play,” and student-athletes are abiding by their own school’s rules, an NIL opportunity should comply with North Carolina state laws. One note, international student-athletes on F-1 visas at North Carolina colleges and universities may not be able to engage in NIL activities. F-1 visa student-athletes can engage in paid work in limited circumstances: (1) the student-athlete must have completed a full academic year, and (2) the paid work must be on-campus employment, practical training, or necessary due to economic hardship. Such harsh treatment has led to individuals and organizations imploring the United States Citizenship and Immigration Services (USCIS) to issue a policy memorandum or for Congress to pass a federal NIL law, allowing international student-athletes to engage in NIL activities. North Carolina State Law: High School Athletes In North Carolina, high school athletics—not including independent high schools—are governed by the North Carolina High School Athletic Association (NCHSAA). Under Rule 1.2.15 of the NCHSAA’s rules and regulations, high school athletes may not accept money. Therefore, to maintain their eligibility, high school athletes under the NCHSAA’s umbrella may not accept monetary compensation for their name, image, and likeness. On the other hand, high school athletes at independent high schools may receive monetary compensation for their name, image, and likeness. Many have utilized their opportunities, including Vertical Academy in Charlotte, North Carolina basketball sensation Mikey Williams. What is Next? As noted above, NIL is an evolving landscape. Beyond the NCAA crafting new rules to limit the impact of collectives and boosters, leaders from multiple conferences are heading to Capitol Hill to discuss federal legislation. Looking forward, a federal law would benefit athletes and universities by creating a uniform rule and allowing international student-athletes to engage in NIL activities. Therefore, over the coming year, expect to see the NCAA and Congress attempt to forge new pathways for NIL. Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.

Last week, Division I leaders met and discussed the need to enforce the NCAA’s name, image, and likeness interim policy. After dropping hints that new guidelines were on the way, the Division I board of directors issued new name, image, and likeness (NIL) guidelines for schools to follow on Monday, May 9. Despite the new guidelines, Division I leaders may have created more questions than answers. New Guidelines In an effort to curb the impact of collectives—a collection of boosters pooling resources to offer payments to athletes—the NCAA clarified its definition of a booster. Specifically, a booster includes a third-party entity supporting an NCAA institution by offering “NIL opportunities to prospective student-athletes (PSA) and student-athletes (SAs) of a particular institution.” Pursuant to NCAA rules, boosters cannot engage in recruiting activities on behalf of a school. While the NCAA made it clear that pay-for-play agreements are impermissible, in an attempt to establish guidelines for permissible agreements, the NCAA offered minimal clarity. “NIL agreements must be based on an independent case-by-case analysis of the value that each athlete brings to an NIL agreement . . . .” With that guidance, questions remain: Who will be independently evaluating each case? Who should be independently evaluating each case? How can the NCAA, or any other party, establish a player’s value? Even though these questions remain unanswered, and thus, the review process remains unclear, the NCAA intends to hold the colleges and universities responsible for impermissible recruiting activities. In the NCAA’s release, the NCAA noted that the policy applies retroactively. However, enforcement staff is only pursuing cases “that clearly are contrary to the published interim policy, including the most severe violations of recruiting rules or payment for athletics performance.” The minimal pursuit suggests that NCAA staff could be overwhelmed by a broad retroactive application of the rules and anticipates pushback to enforcing its policy, including lawsuits alleging antitrust violations in the wake of the United States Supreme Court holding in NCAA v. Alston that NCAA rules restricting compensation provided by schools to athletes could be antitrust violations. This is just the start of the NCAA enforcing the interim NIL policy. Either way, with new guidelines, boosters will continue to evolve for their college or university to remain competitive on the field. Therefore, the new guidelines may merely be the first step in a never-ending pursuit of so-called “amateurism.” Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.

As first reported by Evan Drellich, Senne, et al. v. MLB, et al. has reached a settlement. Before the parties finalize the settlement, the court must approve the settlement, and the plaintiffs must give members of the class an opportunity to be excluded. For now, the settlement appears to be a win for both minor leaguers and Major League Baseball (MLB). Brief Background Originally filed in 2014, Senne is a Class Action lawsuit on behalf of thousands of minor league baseball players that were not paid during spring training or received salaries below the poverty line. The lawsuit has had multiple amended Complaints and multiple Class certifications, including the current classes encompassing players from California, Arizona, and Florida, with allegations of violations of the Fair Labor Standards Act (FLSA) and state minimum wage laws in California, Arizona, and Florida (Florida and Arizona are the locations for Spring Training). Back in March, Judge Joseph C. Spero, United States District Judge for the Northern District of California, ruled that minor league baseball players are year-round employees, and the MLB and minor league teams are joint employers of minor leaguers. Due to their employee status, travel time to away games is compensable under FLSA, Florida, and Arizona law, and travel time to away games is compensable for California League players under California law. In the same ruling, Judge Spero found that Major League Baseball (MLB) violated Arizona state minimum wage law and failed to comply with California wage requirements. For failing to comply with California state law, Judge Spero awarded $1,882,650 in penalties but did not set the damages for violating Arizona state law. Takeaways As expected, Judge Spero’s ruling spurred settlement discussions to avoid a lengthy, public trial that would showcase the harsh conditions of minor leaguers. While avoiding a public trial is one win for the MLB, another win is avoiding a ruling that chips away at the MLB’s exemption from FLSA via the Save America’s Pastime Act. For minor leaguers, any settlement will include more money. In addition, it likely comes with other forms of guarantees to improve conditions for minor leaguers. Note, among the victories for minor leaguers, starting this season, the MLB required teams to provide housing for minor leaguers. Expect any settlement to add further gains to living conditions. What is Next? Under Rule 23 of the Federal Rules of Civil Procedure, there must be a hearing for approval of the proposed settlement, and the plaintiffs must give members of the classes an opportunity to be excluded. Per Evan Drellich, the plaintiffs are requesting until July 11 to file a motion for preliminary approval. Therefore, it will take some time for the parties to finalize the settlement. After 8 years, it appears that minor leaguers are on the cusp of a significant legal victory, which potentially includes higher salaries and improved living conditions. With it, the MLB avoids a public trial and a ruling that could chip away at the Save America’s Pastime Act. Thus, both sides walk away with an opportunity to craft a new future for minor league players and Major League Baseball. Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.

Commissioner’s Discretion The Commissioner of the PGA Tour, Jay Monahan, has the power via the PGA Tour Handbook to utilize four factors to grant a player a conditional release for a non-PGA Tour sanctioned event: The overall makeup of the field from which the member seeks to be released; The member’s standing on the current and previous season’s FedExCup Points List; The number of tournaments that the member has played in, or committed to play in, for the current season; The member’s record of participation in the tournament from which he seeks to be released. Commissioner Monahan used these factors to grant releases to PGA Tour players for the Saudi International, an Asian Tour event backed by the same group as the new LIV Tour. The talk of the golf industry in terms of the new LIV tour seemed to focus on the implications of the upcoming July 1st LIV tournament in Oregon because of a specific rule in the PGA Tour Handbook stating that no conflicting event releases will be approved for tournaments held in North America. There is no rule for the equivalent events in the rest of the world. It was assumed the LIV’s Centurion first tournament in London would not be an issue because it was not being held in North America and would be similar to the Asian Tour’s Saudi Invitational tournament. Commissioner Monahan, however, announced on May 10th that out of the 15 players that applied, 0 would be granted the release to play in the Centurion tournament in London. The former European Tour, now the DP World Tour followed suit stating its members were also not allowed to play in the Centurion event. Both events bring out new information that needs to be analyzed relevant to the inevitable antitrust legislation. Sherman Act Section 1 Claims First, Section 1 of the Sherman Act prevents collective action deemed to be an unreasonable restraint on trade. An important defense to Section 1 liability is the single entity defense meaning the PGA would argue they are one entity, and thus could not have possibly conspired to restraint trade with itself. Now, there is evidence this might not be the case. The DP World Tour announced its decision to bar its players from the upcoming event immediately after the PGA Tour did. At the least, this is possible evidence of a conspiracy to restrain trade that could amount to a group boycott against the players restraining their ability to market their services and restricting the worldwide golf market. The Court would then go to a rule of reason analysis to determine the effects of both tours restricting its players where the relevant market would be expanded to global professional golf This would allow the DP World Tour players to have standing and bring claims against the PGA Tour. There are obvious anticompetitive restraints in both the product and labor market. The restraint directly restricts a player’s ability to use their services and thus, limits the global golf market available to consumers. The PGA and DP Would Tour would first argue they are restricting players to participate in the LIV tour because of the questionable finances of its backing group, LIV Investments. The PGA and DP Tours would argue their product would be hurt because consumer interest would deter if the players in its tour were allowed to play in events backed by this group. The LIV would counter stating that both leagues granted all exemptions to its players for the Saudi Invitational, and consumer interest has not been deterred because of this. Next, the PGA and DP World Tour would argue they are restricting their players to maintain their product and without the restriction their product would not be able to survive. This argument is null. Under National Society of Professional Engineers v. United States, antitrust law exists to protect competition, not competitors, so it is illegal to restrict competition to enable the league or leagues to compete. If the Court found the pro-competitive benefit of maintaining its product image and survival is reasonably related to the restraint on the players and there are no less restrictive alternatives available to achieve the benefit, then the restraint will be deemed legal under the Section 1 of the Sherman Act. At the least, the actions of the PGA Tour and DP World Tour open the door to new claims of anticompetitive practices between them. Sherman Act Section 2 Claims Section 2 of the Sherman Act provides it is illegal to monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nation. The requirements for monopolization are (1) the possession of monopoly power in the relevant market and (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident. Previously, the PGA Tour dealt with a lawsuit similar to facts present today. In Toscano, the court ruled against the player because of the lack of market and the speculative nature of the claim. The player argued he would not be able to join a league if a new one emerged. However, there must actually be an anticompetitive harm and when a new league had not been formed there is no injury. A Section 2 claim could be brought against the PGA Tour and the DP World Tour or either individually. Previously in Toscano, there was an issue defining the market. Now the market is clear, global professional golf services. The PGA would argue that it does not have complete market power because there are reasonable substitutes the players could go play in, such as the DP World Tour. However, the Court may determine that one substitute is not enough to rule out the PGA having market power. Further, the LIV’s purse for the upcoming Centurion tournament is $20,000,000 with first place guaranteed $4,000,000 and last place guaranteed to make $120,000. This is different from the cutthroat nature of the PGA and DP World Tour where players have to make the cut to win any money at all. The LIV is a substitute that allows guaranteed money for players who can still provide value in terms of consumer interest. For example, Martin Kaymer and Robert Garrigus are two of many that were denied conditional release to play in the Centurion tournament. In the last three seasons combined, a former world number 1, Kaymer has earned around $100,000 playing on the DP World Tour and PGA Tour while Garrigus has earned $250,000. One tournament in the LIV would be more earnings than Kaymer made in all of the last three seasons. It would take Garrgius a whopping three tournaments to reach this feat. If the court determines the PGA does in fact have market power, they will then analyze if the PGA used that power to maintain their superior product or business acumen. Here, the LIV has a strong case that the PGA and DP World Tours are denying access to their league to prevent its entry to the market and to force its product from competing against there’s. The LIV will argue the tour’s together and individually are conspiring and attempting to monopolize the world professional golf player services market to hurt the LIV’s brand not to help the PGA or DP World Tour’s brand. There is evidence of this preferential treatment when the DP World Tour and Commissioner Monahan of the PGA Tour as well allowed their players to play in an Asian Tour event backed by the same group as the new LIV league. This shows the PGA is blackballing the LIV not because of the ethical issues surrounding the financing, rather they are afraid of the competition to their monopoly on golf. As the Sherman Act is designed to protect competition, direct restriction of competition to maintain power or promote a product is generally illegal, especially when the restriction harms the worker’s monetary ability concurrently with harming the consumer interest. The first LIV tournament scheduled for North America is July 1st at Pumpkin Ridge Golf Club in North Plains, Oregon. The Tour players must apply for a conditional release by May 15th and the Commissioner will notify those players by June 1st of his decision. The Commissioner is likely to deny these releases based on the denial of releases for the Centurion Tournament and the direct rule restricting players from playing in a different tour event in North America while a PGA Tour event is occurring at the same time. Time will duly tell, but this gives the player’s a perfect opportunity to bring suit and potentially win a challenge the PGA’s rule restricting their services. Robert Alston is a rising 3L at Tulane Law and is the Articles Editor for Article 30 of the Sports Lawyer's Journal. He can be reached via email at [email protected] or on LinkedIn .

The current NBA Collective Bargaining Agreement (CBA) is set to expire after the 2023/2024 season but both sides have an opt out exercise as early as this December. After observing the labor strike that delayed the start of the MLB season, progress is already being made between the National Basketball Players Association (NBPA) and the league to ensure basketball isn’t affected.[1] Let’s examine three major sticking points for the upcoming CBA: Tying Compensation to Games Played The biggest issue between the NBPA and the league during this latest round of negotiations could define the next decade.[2] If you examine the history of the NBA, it was a league largely controlled by ownership. However, the balance of power began to tilt towards the players sometime in the early 2010s. Many mark the official start of the “player empowerment era” as July 8, 2010, when Lebron James made The Decision to leave Cleveland and join the Miami Heat. The last decade plus in the NBA has revolved around superstars taking unprecedented action to control their own destiny. Stars have hopped franchises to team up with each other, signed shorter contracts to constantly put pressure on their teams, and in some rare instances, simply refused to play until their demands like a trade request are answered. It’s become a viable teambuilding strategy for front offices to simply stay patient because the next disgruntled superstar is waiting just around the corner. And when that happens, teams must be ready to pounce. Longtime NBA fans aren’t accustomed to players exerting this much power. On the other side of the fence, modern fans view it as players recognizing their value and acting accordingly. You can’t put a price on what superstars mean to the league, so why shouldn’t they call the shots? This tug of war for power between players and franchises may soon be coming to a head. I previously outlined the grievance filed by Ben Simmons against the Philadelphia 76ers as a major event for the future of the NBA. Simmons demanded a trade away from the 76ers because he was unhappy with the franchise. To gain leverage, Simmons refused to play citing various injuries including mental health. The 76ers responded by not paying Simmons for the time he was away from the team. Some want to analyze this battle between Simmons and the 76ers as any other employment contract – simply put Simmons didn’t show up for work, so he shouldn’t be paid. But Simmons isn’t your typical employee involved in a dispute with his employer. There’s very few on Earth that can do what Simmons can on a basketball court. Because of that, NBA players are afforded leeway in their job duties that’s unique to their status as a professional athlete. The harsh reality is they are treated differently because they deserve to be – they are irreplaceable in every sense of the world. But is there a tipping point? In negotiations for the next CBA, the league will argue that the pendulum has swung too far. To be compensated the handsome amounts they are, the players must be on the court. This is where matters get complicated because players missing time for injury shouldn’t be penalized. Stars have missed games due to injury at an alarming clip over the past several years so the NBPA would never entertain talks that put those players at risk of losing money they already signed for. Currently, the league doesn’t have a process that stops players from sitting out and unethically claiming injury when they aren’t satisfied with their team. A solution for disputes similar to the Simmons situation is that the league employs a neutral third party to immediately make a ruling. If Simmons was made aware from the onset that he wouldn’t be paid for missing games, maybe he’s given extra incentive for him to report to the 76ers and put their differences aside. It paints a grim picture of the status of players and their teams that the dynamic has gotten so hostile that the leagues needs an arbitrator on standby. But this may be the new reality. An additional fix could be harbored within contracts themselves. The league may look to formalize bonus structures that can be achieved based on games played. If a player appears in 80% of his team’s games, he would be eligible for an additional payday. Incentives are already commonplace among NBA contracts, but the league may want to tie more money to them to prevent players from holding out. For example, the league may opt for a player only being eligible for a supermax if they meet a specific games played quota in the previous three seasons. NBA contracts are guaranteed and that’s not changing. But expect to see creative ways to push back to get star players on the court. Reducing the Number of Games This sticking point also relates to the amount of time superstars are missing on the court. The NBA has played an 82-game season since 1967. But the rise of load management where players sit out for rest purposes has continued to trend upwards since the last CBA was signed. The NBA attempted to curtail load management by disallowing resting healthy players on nationally televised games. But it’s an easy hurdle for teams to get by, as they can just place a player on the injury report with “back soreness” and the league then finds themselves in a dicey spot questioning the legitimacy of injury designations. A solution to the load management issue is decreasing the amount of games. Rumors are that the NBA is eying 72 or 68 as a possible number. As with any decision the league makes, the ultimate question is how this will affect the pockets of both ownership and players. The drawbacks against decreasing the amount of games are obvious – less money for everyone. But the NBA is set to sign a new television deal in 2025, with their sights set on a deal worth $8 billion annually.[3] That new television deal money could more than offset the lost revenue by losing ten regular season games. The one additional factor at play is the impact this will have on the record books. With the opposite effect of football increasing the regular season game total, it will be more difficult for modern basketball players to accumulate the stat totals to join players of the past on all-time record lists. The NBA may ultimately not care about this, but if the change happens don’t expect anybody to catch the all-time greats anytime soon. All-NBA Voting It’s difficult for the general public to feel bad for NBA players when it comes to their financial situation. But the one example where a player may be unfairly hurt by the compensation structure under the current CBA is how it relates to All-NBA voting. Each year a group of NBA media members vote on their first, second, and third All-NBA teams to showcase the top 15 players in the league. Historically, the All-NBA teams provide a clear snapshot of the best players in the league in a given year. It’s an accurate benchmark. But the recent CBA signed in 2017 started tying financials to All-NBA. To qualify for a supermax contract extension a player must have spent 7 years in the NBA, still be with his original team (or a team that acquired him via trade) and meet one of the following conditions: Named to All-NBA first, second or third team in immediately preceding season or in two of last three years Named Defensive Player of the Year in immediately preceding season or in two of last three years Named NBA MVP during one of last three seasons Suddenly, media members voting on All-NBA directly controlled the earning capacity of NBA superstars. Predictably, some players have spoken out against this. Draymond Green, via his Instagram story, criticized the process in which media members take personal shots at players and then later control what contracts they qualify for. The modern NBA superstar seems to constantly be at war with certain media members, and the NBA may look to alleviate the tension by lowering the stakes of media-given awards. Not tying these awards to compensation or changing who votes on All-NBA could be a solution explored in the latest negotiations. Matt Netti is a 2021 graduate from Northeastern University School of Law. He currently works as an attorney fellow at the Office of the General Counsel for Northeastern University. You can follow him on twitter and instagram @MattNettiMN and find him on Linkedin at https://www.linkedin.com/in/matthew-netti-ba5787a3/. You can find all his work at www.mattnetti.com [1] Sam Quinn, NBA unlikely to follow MLB's lead with a lockout when current CBA expires after 2023-24 season, per report, CBS Sports (last visited May 11, 2022) https://www.cbssports.com/nba/news/nba-unlikely-to-follow-mlbs-lead-with-a-lockout-when-current-cba-expires-after-2023-24-season-per-report/. [2] Jake Fischer, Sources: Kyrie Irving, Ben Simmons Sagas Could Lead to NBA Rule Changes, Bleacher Report (last visited May 11, 2022) https://bleacherreport.com/articles/2949384-sources-kyrie-irving-ben-simmons-sagas-could-lead-to-nba-rule-changes. [3] Michael Kaskey-Blomain, NBA aiming for new TV deal worth $75 billion which could lead to large increase in salary cap, per report, CBS Sports (last visited May 11, 2022) https://www.cbssports.com/nba/news/nba-aiming-for-new-tv-deal-worth-75-billion-which-could-lead-to-large-increase-in-salary-cap-per-report/.

The NCAA’s Division I Board of Directors issued new name, image, and likeness ("NIL") guidance on Monday to clarify the NCAA's existing rules on the involvement of boosters in recruiting. The guidance was developed by an NIL working group of athletic directors and conference commissioners. The key takeaways of the guidance are the following: The NCAA clarified its definition of "booster" to include collectives. Boosters are not permitted to engage in the recruiting process for prospective student‑athletes, which includes high school athletes and college athletes in the transfer portal. Coaches and institutional staff cannot communicate with prospective student-athletes on behalf of boosters. NIL deals cannot be contingent on initial or continuing enrollment at a school. The NCAA has given its enforcement staff the green light to investigate violations of the NCAA's interim NIL policy and guidance and its existing rules on recruiting, including retroactively. Per the NCAA, it has directed its staff to focus on the "most severe violations," and has emphasized that the investigations are not intended to impact the eligibility of student-athletes. The guidance is subject to state NIL laws, which presumably means that the applicable state NIL law preempts the guidance if there is a conflict. Overall, the new NIL guidance does not create any new rules, but instead clarifies the NCAA's existing rules that prohibit boosters from recruiting and/or providing benefits to prospective student-athletes. While the NCAA has taken a step in cracking down on booster-led NIL collectives, it remains to be seen whether the NCAA's enforcement staff will enforce the new guidance. In recent months, coaches and administrators have publicly called on the NCAA for increased regulation on NIL as NIL deals have started to blur the line between legitimate commercial deals and improper recruiting inducements or pay-for-play. To this point, the NCAA is all bark, no bite, when enforcing its NIL rules, despite calls from coaches and administrators for more help in enforcing and interpreting such rules. Ryan Whelpley is an Associate at Morse in Waltham, Massachusetts, where he is a member of the firm’s Corporate Practice Group and focuses on venture capital financings, M&A transactions, and general corporate work for start-up and emerging growth companies. He is a graduate of Albany Law School (2019) and Union College (2016). At Union, Ryan was a member and three-year captain of the Men’s Basketball Team. You can connect with him via Twitter (@Whelpley_Law) and LinkedIn.

In February, California State Senator Steven Bradford introduced the College Athlete Race and Gender Equity Act. The bill currently sits with the California Senate Appropriations Committee, and a decision on whether it will move forward will be announced on Thursday, May 19. In 2019, California Governor Gavin Newson signed into law Senate Bill 206, a bill also led by Senator Steven Bradford along with Senator Nancy Skinner, which made California the first state in the nation to enact a bill allowing college athletes to be compensated for their name, image, and likeness (NIL). Now, with the NCAA in a period of transforming itself after enacting a new constitution and utilizing the United States Supreme Court’s ruling in NCAA v. Alston, California is seizing the opportunity to shape the future through the College Athlete Race and Gender Equity Act. The College Athlete Race and Gender Equity Act The act begins by declaring certain findings, including: College athletes of color in football and men’s basketball graduate at lower rates than other students; Black athletes experience educational neglect due to a range of issues; and California Football Bowl Subdivision (FBS) football players and Division I men and women basketball players are predominantly black and do not receive at least 50 percent of the revenue they produce. Therefore, to combat the findings, the act requires California colleges and universities to establish a degree completion fund for its athletes. To finance the fund, California colleges and universities must split 50% of each sport’s revenue with the athletes for that sport. Thus, the act is a major win for college athletes in California. On the surface, the act flips the NCAA model on its head by forcing programs to pay their players for their performance, which is not allowed under NCAA rules. As previously noted, the NCAA has been hands-off in enforcing its policies, including its interim NIL policy. If the California act were to pass, it would force the NCAA to decide whether to enforce its policy and risk exposing itself to antitrust lawsuits (Alston held that NCAA rules restricting certain compensation provided by schools to athletes could be antitrust violations) or allow California’s pay-for-play system and risk other pay-for-play systems popping up in other states. The act demonstrates how the state of California, led by Senator Steven Bradford, is willing to lead the way in changing laws to compensate college athletes. If The College Athlete Race and Gender Equity Act is signed into law, California will be testing the expanse of the Alston holding and the willpower of the NCAA. Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.

Both the U.S. Women’s National Soccer Team (USWNT), through the U.S. Women’s National Team Players Association, and the U.S. Men’s National Soccer Team (USMNT), through the U.S. National Soccer Team Players Association, have reached agreements with the U.S. Soccer Federation (USSF) on new collective bargaining agreements (CBA). Importantly, the CBAs accomplish what prior CBAs have not—an equal split of FIFA prize money. Prior CBAs – Disparity in Pay Rate The USMNT’s CBA expired in 2018 (although the USMNT has continued to operate under the expired CBA), and the USWNT’s CBA expired on March 31, 2022. For over a year, the teams and the USSF have been negotiating over new CBAs, with the sticking point being how to equally split FIFA prize money. After the USWNT’s 2019 World Cup victory, “Equal Pay!” chants rang throughout the stadium. In 2018, FIFA awarded $400 million in prize money for the 32 teams at the 2018 Men’s World Cup, compared to awarding $30 million to the 24 teams at the 2019 Women’s World Cup, including the $4 million awarded to the USWNT. Not only was FIFA prize money unevenly distributed, but the teams operated under different pay structures. Specifically, the USWNT mainly operated under a year-round salary structure, with players earning $100,000 per year. Non-salary players (players called up to the team throughout the year) earned between $3,250 and $4,500 per game. On the other hand, players for the USMNT were non-salary, earning $5,000 per game played. New Structure – Equal Pay Rate Now, the players associations will receive 90% of the FIFA bonuses paid at the 2022 and 2023 World Cups and 80% of the bonuses at the 2026 and 2027 World Cups. In turn, the national teams will receive an even split. FIFA previously announced that the bonus pool for the 2022 men’s World Cup in Qatar is $400 million, and the bonus pool for the 2023 women’s World Cup in Australia is $60 million. In addition, the USWNT’s new CBA changes the pay structure. Now, the USWNT will join the USMNT with a non-salary model. For USSF-controlled games against opponents ranked in the top 25 of FIFA rankings, players will receive between $8,000 and $18,000, depending on whether the game is a win, loss, or draw. For all other games, the players will receive between $8,000 and $13,000. For World Cup matches, each player automatically earns $10,000 per game, plus $14,000 for a win or $10,000 for a tie. As a result of the new structure, the average annual payout for men’s and women’s players is expected to be $450,000. Other gains for USWNT include parental leave and child care. Further, the USWNT’s CBA will also finalize the settlement of the USWNT’s class-action lawsuit against the USSF, which was contingent on the USWNT ratifying a new CBA. As a part of the settlement, the USSF agreed to pay out $24 million to the class of players and an additional $2 million for the benefit of USWNT players in their post-career pursuits. A New Future With an equal pay rate, the United States carves a new future for its national teams. While previous countries have either committed or achieved equal pay exclusive of FIFA prize money, including England, Australia, Brazil, Norway, New Zealand, and Sierra Leone, the United States appears to be the first country to achieve equal pay that includes FIFA prize money. Other countries may take a similar approach in the future. Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.

There were 31 players who submitted filing numbers at the conclusion of the exchange date in mid-March. Despite the thought that many teams employ a “file and trial” strategy and wouldn’t negotiate after the exchange date, after two months, more than half the cases have been resolved, with only 5 of those going to an actual hearing. Sometimes when two cases relate substantially to one another, the arbitration panel may wait to release the first case’s results until all the related cases have been heard, which appears to be what is going on with Adrian Houser. The results of four hearings are publicly available, with players and clubs splitting with two victories each. Seven players have settled with their teams, with three of those settlements including an additional mutual option for the 2023 season. Four players have agreed to multi-year extensions with the clubs thus far. HEARINGS THAT HAVE OCCURRED (5): 2 CLUB Wins 2 PLAYER Wins 1 To Be Announced SETTLEMENTS (7): 2 ABOVE MIDPOINT 1 BELOW MIDPOINT 1 AT MIDPOINT 3 MUTUAL OPTION FOR 2023 EXTENSIONS (4) NO UPDATES YET (15): Dean Rosenberg is a rising 3L student at Benjamin N. Cardozo School of Law in New York City and President of the Cardozo Sports Law Society. He can be found on LinkedIn at https://www.linkedin.com/in/dean-rosenberg-4a1507a1/ and on Twitter @deanrosen7. For all of Dean’s Conduct Detrimental Articles, click here.

Yesterday, May 18, 2022, R. Montgomery Sports Group filed a lawsuit against veteran NBA agent Derrick Powell. Roger Montgomery, CEO of Montgomery Sports Group, has been an NBA agent for over 20 years and spent 3 years at Roc Nation. In the complaint, Montgomery claims he hired Powell in August of 2020 to work as an NBA agent at Montgomery Sports. He says Powell resigned from that position, effective November 3, 2020. Powell's biggest NBA client was then-Brooklyn Net Center Jarret Allen. After leaving Montgomery Sports, Powell continued his representation of Allen, helping the rising star reach a massive $100,000,000 agreement with the Cleveland Cavaliers. However, Montgomery claims his company should be paid a fee from that contract, even though Powell had resigned and moved on before it was signed. Montgomery alleges Powell’s employment agreement with Montgomery Sports Group contained a fee tail provision that provided for Powell to pay Montgomery 70% of the fees for contracts that Montgomery otherwise would have been entitled to had Powell remained employed with Montgomery. He claims the Allen contract falls under said provision. Often in sports agency, there are major, negative ripple effects for an agency when an agent leaves (and takes his or her clients). With that, agencies draft fee tails into employment agreements. A “Fee Tail” boils down to an obligation by an individual to make payments to a former employer based on revenues received after termination/expiration of the employment agreement. The purpose of a fee tail provision is to protect an agency in light of the NBPA policy that gives players full discretion to choose their agent. Montgomery claims he has made multiple demands of the commission fees from Powell he feels he is entitled to. He says Powell ignored him and won't pay, sparking this lawsuit. In connection with the Allen Contract, Powell will be splitting the agent fees with Jim Tanner and Tandem Sports + Entertainment. Pursuant to Powell’s split with Tandem, Powell will receive 50% of the agent fees received by Tandem. As Powell will receive agent fees pursuant to Allen's Contract, Montgomery claims such agent fees should fall under the fee tail provision Powell had in his employment agreement with Montgomery and thus entitles Montgomery to a portion of this commission. As a result of Powell’s alleged breach of the employment agreement, Montgomery brings this suit to collect damages in excess of $1,000,000. Jason Morrin is a soon-graduate of Hofstra Law School. He was the President of Hofstra’s Sports and Entertainment Law Society. Currently, he is a Law Clerk at Zumpano, Patricios, & Popok. He can be found on Twitter @Jason_Morrin. Image via News 5 Cleveland

On Wednesday, Alabama Coach Nick Saban ruffled some feathers in the college football world when he accused Jimbo Fisher of buying his #1 ranked recruiting class. For context, Texas A&M finished atop of both Alabama and reigning national champion Georgia’s respective recruiting classes. Almost immediately, Saban was accused of being a hypocrite as there’s been an abundance of circulating rumors that Saban and Alabama have been paying players for years and that they were the NIL before NIL. In terms of evaluating the impact these comments will have on the landscape of NIL, it could cause the NCAA to investigate possible violations or retroactively enforce their recent guidelines against A&M. Colleges in states that don’t have an NIL law are at an advantage because they only have to comply with the looser NCAA guidelines compared to those in states with NIL laws that tend to be stricter than the ones put forth by the NCAA. If federal legislation governing NIL ever comes to fruition (which is a big if especially in the near future), it would preempt any state law on the matter. The issue of an NIL bill at the federal level is that it would most likely have to originate in the Senate and it seems there are more pressing matters in this country than regulating how much a college athlete can be compensated. The lack of uniformity and lack of enforcement of booster-funded deals by the NCAA seems to be what many, and Saban particularly, seem to be taking issue with. If you’re looking at the initial goals of NIL, to allow college athletes and not just their respected universities, to be able to profit off their own name, the current landscape and massive endorsement deals seem to go too far. There has to be a fine line established between enticing a recruit or highly sought after transfer player to attend a university, (See Nijel Pack, 4-Star guard averaging 17 PPG paid $800,000 to attend Miami) and an athlete endorsing a company. As Colorado AD recently pointed out, what’s been going on recently is not NIL and just a modified pay-for-play system. If the NCAA continues to allow wealthy donors and established collectives to run rampant, college football, and college athletics, in general, will be a pure free agency and the wealthiest fan base will attract the most talent. Of course, in response to that, one can make an argument that that’s what was already going on, as Tua Tagovalia’s entire family moved from Hawaii to Alabaster, Alabama possibly promised more than just a spot on the Alabama football team. Or the stories of the University of Tennessee handing out wads of cash in McDonald’s bags. Jimbo Fisher wasn’t the only target of Saban’s tirade, as he called out both Jackson State and Miami’s billionaire booster, John Ruiz. The solution to the madness would appear to be one uniform law that is enforced either by the NCAA or at the federal level that applies to each state and includes a provision regarding university collectives and possibly a cap on the amount an NIL can be, like topping out at 6 figures. To avoid the booster-plagued era epitomized by SMU, the NCAA might require a return on investment showing so that the athlete isn’t just paid to attend the university or paid to play and it might actually make sense, from an economic standpoint, for that company to want to pay the athlete to endorse it or act as a brand ambassador. Ruiz is likely the NCAA’s next target if the NCAA chooses to act, although he’d likely be protected by his legit company Life Wallet. Duncan can be found on Twitter @dunkun

In April, the city of Anaheim and the state of California reached a settlement agreement that would resolve their dispute over the city’s 2019 land sale of Angel Stadium to SRB Management LLC, a land-holding company owned by Angels owner Arte Moreno. Now, Orange County Superior Court Judge Glenn Salter has granted the California Attorney General’s office’s request to halt the sale of the stadium in light of the ongoing federal corruption probe of now-former Anaheim Mayor Harry Sidhu. The Ongoing Issues In October 2019, California Governor Gavin Newsom signed into law certain amendments to the California Surplus Land Act, which requires the city to first offer public land to developers that can build homes for low-income families. The amendments include requiring cities to take a formal action in a regular public meeting to declare land “surplus land,” and the city must support the declaration through written findings. Importantly, the amendments carve out an exception to the application of the amendments. Section 54234 of the Land Surplus Act states, “if a local agency, as of September 30, 2019, has entered into an exclusive negotiating agreement . . . the provisions of this article as it existed on December 31, 2019, shall apply . . . .” In December 2019, SRB agreed to purchase Angel Stadium and an additional 153 acres of Anaheim-owned land for $320 million. As a part of the purchase, the Angels agreed to remain in Anaheim until at least 2050. In April 2021, the California Department of Housing and Community Development (HCD) sent a warning letter to the city warning Anaheim that the city may have violated California’s Surplus Land Act. Specifically, the city failed to declare the land as either “surplus land” or “exempt surplus land” as required by the amendments. In December 2021, the HCD sent a Notice of Violation to the city. In turn, the city responded by denying that the Surplus Land Act applied to the sale of the property. Specifically, the city has maintained the position that the exception applied to the city’s deal with the SRB. The city entered into an exclusive negotiating agreement with SRB prior to September 30, 2019. Thus, the city did not need to issue any declaration as to the property. Settlement Agreement As a part of the settlement between the city and state of California, the city would put 30% of the full purchase price (roughly $96 million) into a trust fund to fund affordable housing in the city within five years. In turn, the city would not admit to a violation of the Surplus Land Act, and the funds could be used to build up to 1,000 additional units. Corruption Probe Mayor Harry Sidhu resigned this past Monday, May 23, amidst the federal investigation. Although Mayor Sidhu is not currently charged with a crime, in the Attorney General’s office’s request to halt the settlement, the Attorney General’s office included FBI search warrant affidavits that detailed the investigation. The federal investigation includes accusations of bribery, fraud, obstruction of justice, and witness tampering. Among the investigation is a December 2021 recorded conversation between Sidhu and Todd Ament, who is also under federal investigation as the former leader of the Anaheim Chamber of Commerce, where Sidhu revealed a plan to elicit a large donation from the Angels due to the land sale. What is Next On May 20, Representatives for SRB Management, LLC and Angels Baseball LP sent a letter to the city manager, James Vanderpool, reiterating that SRB Management, LLC and Angels Baseball LP “acted in good faith throughout their dealings with the City of Anaheim.” Additionally, they reminded the city of the benefits of the land sale deal, including keeping Angels Baseball in Anaheim. Today, May 24, the Anaheim City Council is meeting to discuss the letter and the path ahead. Despite SRB Management, LLC’s assurances, serious questions remain about whether the city acted in good faith. Additionally, the federal investigation may reveal more inappropriate conduct. Thus, for now, the city’s settlement with the state of California is halted, and the land sale is in jeopardy. SRB Management, LLC has asked the city of Anaheim to move forward by June 14. If the city fails to move forward, Angels Baseball may be finding a new home. Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.