Indianapolis, Indiana – The NCAA Board of Governors approved the terms of what is anticipated to be a multi-billion-dollar settlement in the House v. NCAA class-action lawsuit on Wednesday. This decision was also backed by Big Ten presidents and chancellors, marking a significant step towards finalizing a settlement that could reshape the college sports business model. The Big 12 and ACC leaders had already approved the terms the day before, with other power conferences expected to follow suit.
Sources familiar with the negotiations revealed that the settlement details include over $2.7 billion in back-pay damages that the NCAA will owe to former Division I athletes. Additionally, a future revenue sharing model between power-conference schools and athletes is expected to be implemented. These damages would compensate Division I athletes dating back to 2016 for lost name, image, and likeness (NIL) earning opportunities, with payments likely to be disbursed over a 10-year period.
Despite some internal dissension within the NCAA, the payment model being voted on entails the NCAA covering a substantial portion of the damages, with power conferences responsible for the remainder. This allocation has sparked debate among smaller, non-FBS Division I conferences over the financial burden placed on them. The introduction of a revenue sharing option for power-conference programs, potentially beginning as early as next year, would allow athletes to receive a portion of the schools’ annual revenue directly.
NCAA President Charlie Baker emphasized the significance of the settlement in providing clarity and stability to schools while presenting new opportunities for student-athletes. Once both sides agree on the terms, the settlement will be submitted to Judge Claudia Wilken of the U.S. District Court for preliminary approval, initiating a process that includes a period for potential opt-outs and objections.
The House v. NCAA case, which includes plaintiffs Grant House and Sedona Prince, aims to address both retroactive NIL damages and future revenue sharing restrictions in college sports. The potential implications of a trial include a significant shift in the amateurism framework and financial risks for the NCAA. A settlement could pave the way for revised payment structures and safeguard the NCAA from additional legal challenges.
In addition to addressing financial compensation, the settlement negotiations also touch upon roster limits for power-conference sports and lingering questions regarding Title IX, third-party NIL collectives, and the ongoing discussions surrounding unionizing efforts and employment status in college athletics. This proposed settlement stands as a pivotal moment in college sports, with far-reaching implications for athletes, institutions, and the NCAA.