- Oliver Luck, Former EVP, NCAA & Director of Athletics,West Virginia University (Moderator)
- Andrew Donovan, Outgoing Sr. Assoc. AD for Regulatory Affairs, University of Tennessee & Incoming VP of Collegiate Partnerships, Altius Sports Partners
- Maggie McKinley, Deputy Athletic Director & SWA, University of Cincinnati
- Kendall Spencer, Georgetown University Law Graduate, Former NCAA Board Member and Former Men’s Track & Field Student-Athlete, University of New Mexico
Note that nothing in this recap shall constitute legal advice. Institutions are advised to consult with their general counsel on NIL institutional policies.
With institutions now expected to develop their own rules about student-athlete name, image, and likeness (NIL) activities within the parameters of the NCAA’s interim NIL policy, the ball has been thrown into the court of our member institutions. Under the NCAA’s interim policy, state NIL laws take precedence over NCAA rules. In states without NIL laws, each school is expected to make its own NIL policy subject to NCAA guardrails pertaining to pay for play, impermissible offers and inducements or extra benefits. Institutions will need to create their own policies related to disclosure, conflicts with institutional agreements and values, as well as use of institutional marks. The issue of disclosure is particularly interesting given that non student-athletes are not required to disclose their NIL agreements, and states vary as to the timing, transparency, and threshold for disclosure. In that vein, LEAD1 held its latest webinar, moderated by Oliver Luck, former NCAA executive and Director of Athletics at West Virginia University, on the intersection between NIL and institutional policies. The panel also featured Maggie McKinley, Deputy Athletic Director at the University of Cincinnati, Andrew Donovan, Associate AD for Regulatory Affairs at the University of Tennessee, and Kendall Spencer, former student-athlete at the University of New Mexico, and NCAA Board Member. Here are the important takeaways.
- Use of institutional marks. Most states that have passed NIL bills leave use of school intellectual property to the institution. In that regard, McKinley and Donovan’s states, Ohio, and Tennessee, have NIL laws that state such. At both schools, student-athletes must obtain permission from the schools to use institutional marks in NIL agreements. Cincinnati has a licensing department on campus, while Tennessee has assigned this role to a senior administrator in athletics. Initially, according to McKinley, schools may not be as harsh on student-athletes for improper use of marks, and are, rather, focusing more on education. According to Spencer, from an institutional standpoint, “being organized is the most important thing,” as issues could arise in the future where third parties, not just student-athletes, improperly use marks.
- Disclosure of NIL agreements. Most states that have passed NIL bills mandate that student-athletes disclose NIL contracts to the institution in a manner the institution implements. Note that the NCAA interim policy is silent on disclosure, but states that individuals should report NIL activities consistent with state law and/or institutional requirements, if applicable. States also vary as to disclosure rules, including on timing. According to Spencer, being overly restrictive on disclosure, such as requiring too much disclosure, could subject institutions to liability. If an NIL contract, for example, is illegitimate, and the school had enough information to know about it, schools could be found liable. Thus, “bare minimum,” disclosure is a “good place to start,” said Spencer. According to McKinley, Cincinnati requires disclosure after the NIL contract is signed, but does not have a “day’s” requirement. In addition, disclosure could be helpful for determining fair market value and creating a “knowledge base” of case studies for student-athletes to learn from. Creating an overly restrictive disclosure policy could also put student-athletes at risk from an eligibility standpoint. According to Spencer, obtaining written contacts might be a good best practice used for educational purposes down the road, but that ultimately, it is best to follow state law from a liability standpoint. All in all, as we get deeper into NIL, education is critical. “You are now the CEO of your own business,” said Donovan.
- Conflicts between sponsors. States also vary on handling conflicts between sponsors. Some states leave it up to the institution, while others explicitly state that NIL deals cannot violate team contracts. The biggest issue is how institutional policies are being used in recruiting, according to Donovan. Of course, schools that place more restrictions on NIL opportunities will have to explain these policies to recruits. Some NIL agreements could be considered “pay for play” or “improper inducements,” which makes every NIL contract fact determinative, such as whether a quid pro quo relationship exists. Education, and understanding what other schools are doing, can mitigate potential eligibility issues. Some student-athletes might even decide to skip media appearances, unless paid.
Ultimately, all schools are learning as we go. But the most important takeaways are educating, and communicating with all stakeholders, including student-athletes, coaches, and boosters.