Name, Image and Likeness
The National Collegiate Athletic Association (“NCAA”) has enjoyed unprecedented autonomy as a non-profit association representing approximately 1098 member institutions. Its members are both public and private universities and colleges throughout the United States divided into three divisions. The NCAA enjoys a great degree of latitude in the governance of the association members, their staff and student athletes by virtue of the voluntary nature of its membership. As a condition of membership institutions contractually agree to strictly adhere to the Constitution and Bylaws of the association which restricts the benefits which a member can provide to its student athletes as well as third parties affiliated with the institutions such as alumni and boosters.
Courts have historically been reluctant to interfere in the governance of the NCAA unless its policies or the application of its policies run afoul of state or federal laws, such as antitrust laws. This governance structure has provided the association with many economic and market advantages evolving into a multibillion dollar sports and entertainment enterprise, much of which has been made possible by its business model (otherwise referred to as the “Collegiate Model”). Through its adherence to the Collegiate Model, the NCAA promotes amateurism as a core principle of competition and fairness in intercollegiate athletics. A byproduct of amateurism is that the cost of labor, as compared to professional sports, is arguably far less expensive than its professional counterparts which compete for the same entertainment dollars. In order to preserve its amateurism status, the NCAA Bylaws have prohibited student athletes, both prior to entering member institutions and after, from leveraging their athletic prowess in exchange for a financial benefit. However, recent court decisions, recent state legislation and the reality of the free markets are challenging the NCAA’s notion of amateurism which denies student athletes the opportunity to exploit for compensation their name, image and likeness (“NIL”).
In addition to state legislatures, Congress has decided to weigh in on the issue creating the impetus for the NCAA and its members to reevaluate the propriety of such restrictions on student athletes. Congress has taken a particular interest in this issue as evidenced by the formation of a bipartisan working group led by U.S. Senators Mitt Romney, Corey Booker and Chris Murphy. Senator Murphy summarized his sentiments about NIL as follows:
“College athletes are being used as commodities to make money for the NCAA, colleges and corporations, while not being compensated for the work they do, nor given the appropriate health care and academic opportunities they deserve,” Murphy said in a statement. “That’s plain wrong. The majority of executives and coaches who are getting rich off college athletics are white, while the majority of players at the big time sports programs are black. This is a civil rights issue and I’m glad to launch this bipartisan working group to fix the inequities in this broken system.”
U.S. Senator Chris Murphy of Connecticut, by Steve Berkowitz, USA Today December 17, 2019.
The growing controversy threatens to dismantle the framework of the NCAA’s “Collegiate Model”. In recent cases the courts have called into question the purity of the NCAA’s definition of amateurism. The question being asked, by those outside of the NCAA is why is it not permissible for a student athlete to leverage his or her NIL for remuneration? The common response from the NCAA and its members is that i.) it undermines the “Collegiate Model”, ii.) it will create a competitive imbalance in intercollegiate athletics, iii.) it could become a Title IX/gender equity nightmare.
What is missing in much of the discussion about NIL is not every person or student athlete has a commercially marketable NIL, only a select few will have the ability to leverage their name, likeness and image. The exploitation and/or monetization of one’s NIL is fundamentally the legal right of a person, who enjoys a certain amount of notoriety or popularity in the marketplace to financially benefit from their celebrity. In the world of intellectual property NIL is also referred to as “rights of publicity” which legally inure to the individual, not to any institution or organization by which they may be employed and/or in which they may be participating in some form of sports or entertainment activity. The assumption is that student athlete’s marketability will be exclusively tied to their affiliation with their college or university which in many cases may be an inaccurate assumption. Zion Williamson arrived at Duke University with a national brand or profile honed in AAU and high school basketball. Thus giving rise to a preexisting financial valuation of his NIL and persona prior to arriving at Duke. The NCAA is looking for a global solution which fits within its current framework, however, it is more likely market forces and technology will shape the contours of the present and future opportunities for student athletes. What is certain is the lid to “Pandora’s” NIL Box is open and will lead to sweeping changes in the way that the NCAA currently conducts business.