Film Room: Major regulatory detail revealed

House Implementation Q&A

On June 13, the NCAA issued a Q&A guiding on implementation of the House settlement. The Q&A is extremely informative and worth reading cover to cover. The most impactful aspects of the Q&A to a given institution will vary depending on the circumstances of that institution. Below, we distill the most broadly applicable items of great significance:

• Designated Student-Athlete. 
  • Designated Student-Athletes (DSAs)—recruits or student-athletes who would have lost their roster spot due to settlement-imposed roster limits (see Q&A C11)—will not count against settlement-established roster limits for the duration of their eligibility (see Q&A C13-14). So, a freshman who learned in March that he was losing his spot on the football team could be identified as a DSA and would not count against his institution’s settlement-imposed roster limit of 105 for the next three seasons (until his eligibility is exhausted).
  • DSA status is determined by an institution attesting to a recruit/student-athlete’s DSA status. (See Q&A C11.) These attestations must be made and submitted within the next two and a half weeks—by July 6. (See Q&A C15.)
  • The treatment of DSAs—a new concept, debuted barely a month ago—can have a big competitive impact. Programs willing to shoulder the burden of a larger roster can now have that larger roster. It’s relevant for all sports but perhaps most impactful in football, where very large rosters have historically provided coaches with coveted flexibility and depth.
  • A DSA is permitted to transfer (and retain DSA status through the transfer) between their designation as a DSA (by July 6) and the roster declaration date for that student-athlete’s sport for the 2025-26 academic year. (See Q&A C18.) In general, team roster declarations are due the day before a team’s first competition—for football, that’s late summer. Look for July and August to include a flurry of movement, with football programs adding impactful depth to rosters.
• Institutional Cap.
  • The cap for the 2025-26 year is set at $20.5 million. (See Q&A D3.)
  • For multi-year institutional agreements, only the payment made during the relevant cap year is included in that year’s institutional cap figure (not the total contract amount that extends beyond the relevant cap year). (See Q&A D8, D20.)
• Progress Toward Degree. Student-athletes must meet progress toward degree requirements to receive institutional payments, heightening the significance of academic support and related monitoring. (See Q&A D34, D37.)
• Third-Party NIL.
  • Associated Entity/Individual Considerations. Both student-athletes and third parties will be required to submit attestations to NIL Go. (See Q&A E10-11.) As part of its attestation, a third party will be required to indicate whether it is an Associated Entity/Individual. (See Q&A E11.) Only third-party deals with Associated Entities/Individuals will be subject to the valid business purpose and range of compensation analyses. (See Q&A E18.) The College Sports Commission (CSC) will determine whether a third party to a deal is an Associated Entity/Individual. (See Q&A E2, E16.) There’s also a role in this process for the institution: “If a noninstitutional payor cannot be verified as an associated entity or individual, then the institution in which the involved student-athlete is enrolled will be responsible for determining whether the payor is an associated entity or individual. Further, each Division I institution must submit a list of all associated entities or individuals to NIL Go annually or as requested by the College Sports Commission.” (Q&A E16.)
  • "Valid business purpose” defined: a student-athlete NIL agreement “must include the promotion or endorsement of goods or services provided to the general public for profit.” (Q&A E19.)
  • “Range of compensation” defined: “rates and terms commensurate with compensation paid to similarly situated individuals with comparable NIL value who are not current or prospective student-athletes at the institution the student-athlete is currently enrolled in or being recruited to attend.” (Q&A E20.)
  • Institutions may facilitate third-party deals for student-athletes—such deals would be submitted to NIL Go and would not be subject to the institutional cap, provided that the third party is funding the entire payment. (See Q&A E3.) 
• CSC Enforcement.
  • The CSC “has the authority to investigate an alleged violation of NCAA rules developed as part of the settlement agreement (e.g., roster limits, provision of additional payments or benefits and noninstitutional NIL agreements) pursuant to the standards and procedures set forth in Bylaw 23 and any applicable internal operating procedures.” (Q&A F1.)
  • The CSC will prescribe penalties. (See Q&A F1.)
  • “A student-athlete or institution may contest the decisions of the College Sports Commission for violations of the applicable rules using the neutral arbitration process.” (Q&A F3.)
  • Contested decisions will be decided in arbitration that’s to conclude within 45 days of the commencement of the proceeding absent good cause for an extension. (See Q&A F5.)
  • Penalties are stayed during the pendency of the arbitration. (See Q&A F6.)
  • Student-athletes who proceed in arbitration have a right to counsel, which may be paid by the student-athlete’s institution. (See Q&A F7-8.)

Hearing on the SCORE Act

On June 12, the House Subcommittee on Commerce, Manufacturing, and Trade led a hearing on the Student Compensation and Opportunity through Rights and Endorsements (SCORE) Act. According to reporting by Daniel Libit of Sportico, support for and opposition to the legislation seem to be forming along familiar lines. We’ll keep you posted on the SCORE Act’s progress. 

Notices of Appeal in House – Impact and What to Expect

On June 11 (we said it was a busy week), a group of objectors provided notice that they appeal the approved House settlement. Amanda Christovich of Front Office Sports reported that the appeal will argue that the settlement violates Title IX. On June 12, the Ninth Circuit Court of Appeals issued a scheduling order that includes deadlines over the coming months. On June 16, another group of objectors filed a notice of appeal. Based on the prior positions of these objectors, it seems likely that their appeal will focus on Title IX as well. 

These appeals should not impact the going-forward (injunctive relief) components of the settlement, which include the institutional payment structure, changes to scholarship and roster limits, and third-party NIL regulation. They will, however, delay the back-damages payments to former student-athletes, which cannot go into effect until all appeals challenging the final settlement are fully resolved. That process can take years. For that reason, the significant damages payments are on hold for the foreseeable future. 

The deadline for any other objecting class members to appeal the settlement is early next month. We’ll continue to keep you posted.