The NCAA has settled a lawsuit alongside four states and the District of Columbia regarding its ban on name, image, and likeness (NIL) compensation for athletes during recruitment. Initiated by attorneys general from Tennessee and Virginia, the suit challenged NCAA policies as antitrust violations. A preliminary injunction prevented the NCAA from enforcing its recruitment restrictions, leading to this recent settlement, which is pending approval. This development could drastically alter college sports financial dynamics, potentially requiring the NCAA to compensate athletes and share revenue with colleges.
"Last year, we blocked the NCAA's unlawful enforcement against Tennessee students and schools, and now this settlement in principle lays the groundwork for a permanent solution."
The NCAA policy prohibits the use of NIL contracts as a recruitment incentive, meaning athletes cannot negotiate NIL deals with collectives or boosters before they commit to a college.
If passed, the settlement would require the NCAA to pay $2.8 billion in back pay for the use of athletes' NIL since 2016, as well as create a revenue-sharing model.
Judge Clifton L. Corker issued a preliminary injunction barring the NCAA from enforcing these rules a month after the lawsuit was filed.
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