Laws for Name, Image, and Likeness Rights of College Athletes
Student athletes have been treated as amateurs rather than professionals throughout the history of US college sports. In other words, they cannot be paid for their contributions to a team. The National Collegiate Athletic Association (NCAA) has upheld the principle of amateurism in college sports with unrelenting tenacity. Colleges and individual athletes can face serious penalties for violations. These might occur both while an athlete is enrolled as a student and during the recruiting process before a high school athlete commits to a college.
The concept of amateurism persists today in the sense that student athletes still cannot receive "pay for play." In 2021, though, the NCAA agreed to loosen its rules regarding the name, image, and likeness (NIL) rights of student athletes. These essentially correspond to the right of publicity, which does not attach only to professional athletes and other celebrities. Most people have a right to control and potentially profit from the commercial use of their name, image, or likeness. However, NCAA rules had barred student athletes from engaging in NIL activities based on their participation in college sports.
How to Profit From NIL Rights
An athlete might license the use of their identity in products sold to consumers, such as sports apparel or video games. In other cases, they might sign endorsement agreements with companies to help promote their products or services for a fee.
In June 2021, the US Supreme Court ruled that the NCAA could not prevent schools from providing "education-related benefits," such as tutoring, to college athletes. The Court held that this would violate federal antitrust laws. While NIL rights are not considered education-related benefits, a concurring opinion by Justice Brett Kavanaugh suggested that other NCAA restrictions on compensation related to participation in sports might trigger antitrust concerns as well. Thus, the NCAA may have revised its rules to forestall further legal challenges.
NCAA Rules and State Laws on NIL Rights
Under rules that took effect on July 1, 2021, student athletes in Division I, Division II, and Division III generally hold the right to engage in NIL activities to the extent that this complies with state law. Athletes may hire professional representatives, such as agents, to assist them. To comply with NCAA rules, an athlete must report NIL activities to their college, which must ensure that the activities fall within applicable laws. (This is especially critical in states that impose criminal penalties for violations of NIL laws, such as Alabama.) Restrictions continue to apply to NIL compensation related to the recruiting process.
A majority of the states have passed laws governing college athlete NIL rights. One group of states, including Texas, Florida, and Illinois, passed laws that took effect at the same time as the new NCAA rules. Several more states have passed laws that will take effect later in 2021 or in 2022. Yet another set of states, including California, have passed laws that will take effect in 2023 or later. College athletes in states that have not passed NIL laws need to comply only with NCAA rules and any rules imposed by their conference or school. Congress has not yet passed a federal law on college athlete NIL rights, although lawmakers have discussed the topic.
Will NIL Rights Matter?
Many observers have downplayed the impact of the new NCAA rules. They have noted that elite athletes in high-profile sports, such as football, basketball, and baseball, will earn far more after turning pro than through NIL rights in college. However, NIL rights may make a greater difference for athletes in less prominent sports, such as Olympic sports and many women’s sports, which are less lucrative even for the brightest stars.
The Justia 50-state survey on state NIL laws describes the main rules for athletes and schools in each state. Some common provisions include:
Prohibiting schools from withholding scholarships or eligibility to participate in athletics from athletes who exercise NIL rights
Prohibiting schools from providing NIL compensation to current or prospective student athletes or using NIL agreements as recruiting inducements
Allowing athletes to hire agents, attorneys, or other representatives to assist them with NIL contracts, and providing requirements for these representatives
Requiring athletes to disclose NIL agreements to schools, and prohibiting agreements that conflict with school or team contracts
Prohibiting athletes from endorsing alcohol, tobacco, marijuana, gambling, adult entertainment, or other morally questionable activities
Protecting the intellectual property rights of schools
Requiring schools to provide financial literacy training for athletes
Allowing schools to prohibit athletes from engaging in NIL activities during official team activities
A complex issue related to NIL rights involves transfers of college athletes between programs. The NCAA recently loosened its transfer rules, and the rate of transfers has increased dramatically as a result. What happens when an athlete with an NIL agreement transfers to a new school in another state? While some state laws specifically prohibit transferring the agreement, the outcome can be less clear when the origin state or the destination state does not have an NIL law.