Lawyers for the Plaintiffs in House Agreement fire 1st shot

[GoHorns1]

https://sports.yahoo.com/college-football/breaking-news/article/house-attorneys-slam-ncaa-and-power-conferences-over-denied-nil-deals-issue-legal-warning-about-settlement-205015881.html?guccounter=2

[GoHorns1]

Get lots of popcorn ready, going to be wild!

[jonbailey]

Where do we think this goes?

[Paul Jespersen]

and we are off...

to where we don't know, but off we go!

🤘

[GoHorns1]

15 minutes ago, jonbailey said:

Where do we think this goes?

Based on recent court rulings concerning the NIL the CSC is going to lose its court ruling.

Edited yesterday at 01:03 AM by GoHorns1

[Rocky P]

No matter what happens, its going to be appealed and litigated for a long time

[ArizonaLonghorn]

I was going to post something similar from an article New NIL enforcement targets collectives, deals must serve ‘valid business purpose’ in The Athletic (paywall) - the NIL Go dudes are turning down almost all the collective proposed deals.  Lawyers, who supposedly were paid $750,000,000 litigating the original House settlement, are already drawing up battle lines for the next round of lawsuits - Plaintiffs’ lawyers in House v. NCAA settlement to get roughly $750 million in fees (paywall).

One question I had was what are the consequences if agents simply ignore the NIL Go rules?  Supposedly the payments would be banned but what happens to the player and the school if they simply do it anyway?  Or pay the parents instead of the recruit?  I couldn't find any enforcement mechanisms or clear cut rules for penalties.  Without subpoena power (the fatal flaw of the NCAA Compliance team) to check banking records it's hard to see how this might be enforced.

some quotes:

[quote] The goal is to prevent schools from utilizing booster-driven entities to funnel payments to recruits and transfers as a workaround to the $20.5 million revenue-sharing cap.

Guidance issued Thursday by the College Sports Commission said that “an entity with a business purpose of providing payments or benefits to student-athletes or institutions, rather than providing goods or services to the general public for profit, does not satisfy the valid business purpose requirement set forth in NCAA Rule 22.1.3.”

It then cited as an example a collective that “reach(es) a deal with a student-athlete to make an appearance on behalf of the collective at an event, even if that event is open to the general public, and the collective charges an admission fee (e.g., a golf tournament).” And, “The same collective’s deal with a student-athlete to promote the collective’s sale of merchandise to the public would not satisfy the valid business purpose requirement for the same reason.”

...

In a series of posts on X on Thursday, Dalton K. Forsythe, director of Utah State’s Blue A Collective, criticized NIL Go for technical issues, then said, “We’re hearing from peers across the country: nearly 100 percent of collective-backed NIL deals are being denied, regardless of size or structure.”

He continued, “The College Sports Commission has taken the position that collectives cannot serve a ‘valid business purpose’ — a standard that was never clearly communicated before implementation.”

... (the Collectives have joined forces to fight this.  Here's a statement they issued): 

“Today’s commentary from the College Sports Commission regarding ‘true NIL’ and ‘valid business purposes’ is not only misguided, but deeply dismissive of the collective organizations and the tens of thousands of fans and donors who fuel them,” The Collective Association said in a statement. “Any attempt to delegitimize the role collectives play in today’s collegiate athletics landscape ignores both legal precedent and economic reality.”

[/quote]

Lawsuits, I smell lawsuits.

 

[Hashtag]

A YouTube channel is a legitimate business entity and appearances could be paid as such 

[Itsamystery]

10 hours ago, ArizonaLonghorn said:

I was going to post something similar from an article New NIL enforcement targets collectives, deals must serve ‘valid business purpose’ in The Athletic (paywall) - the NIL Go dudes are turning down almost all the collective proposed deals.  Lawyers, who supposedly were paid $750,000,000 litigating the original House settlement, are already drawing up battle lines for the next round of lawsuits - Plaintiffs’ lawyers in House v. NCAA settlement to get roughly $750 million in fees (paywall).

One question I had was what are the consequences if agents simply ignore the NIL Go rules?  Supposedly the payments would be banned but what happens to the player and the school if they simply do it anyway?  Or pay the parents instead of the recruit?  I couldn't find any enforcement mechanisms or clear cut rules for penalties.  Without subpoena power (the fatal flaw of the NCAA Compliance team) to check banking records it's hard to see how this might be enforced.

some quotes:

[quote] The goal is to prevent schools from utilizing booster-driven entities to funnel payments to recruits and transfers as a workaround to the $20.5 million revenue-sharing cap.

Guidance issued Thursday by the College Sports Commission said that “an entity with a business purpose of providing payments or benefits to student-athletes or institutions, rather than providing goods or services to the general public for profit, does not satisfy the valid business purpose requirement set forth in NCAA Rule 22.1.3.”

It then cited as an example a collective that “reach(es) a deal with a student-athlete to make an appearance on behalf of the collective at an event, even if that event is open to the general public, and the collective charges an admission fee (e.g., a golf tournament).” And, “The same collective’s deal with a student-athlete to promote the collective’s sale of merchandise to the public would not satisfy the valid business purpose requirement for the same reason.”

...

In a series of posts on X on Thursday, Dalton K. Forsythe, director of Utah State’s Blue A Collective, criticized NIL Go for technical issues, then said, “We’re hearing from peers across the country: nearly 100 percent of collective-backed NIL deals are being denied, regardless of size or structure.”

He continued, “The College Sports Commission has taken the position that collectives cannot serve a ‘valid business purpose’ — a standard that was never clearly communicated before implementation.”

... (the Collectives have joined forces to fight this.  Here's a statement they issued): 

“Today’s commentary from the College Sports Commission regarding ‘true NIL’ and ‘valid business purposes’ is not only misguided, but deeply dismissive of the collective organizations and the tens of thousands of fans and donors who fuel them,” The Collective Association said in a statement. “Any attempt to delegitimize the role collectives play in today’s collegiate athletics landscape ignores both legal precedent and economic reality.”

[/quote]

Lawsuits, I smell lawsuits.

 

Thanks for posting. I wonder about the immediate effect it will have. Does the player not receive funds during the appeal? Will they throw up their hands and surrender? Then what? Stay at the school that built a relationship around bag money that isn’t there or transfer and loop back around to the schools that offered more development and long term possibilities? How does a coaching staff feel about the character and the culture in the locker room? 
 

Lots of questions, which will take some time to answer while college football can hang in the balance.

[.45s]

Maybe Capt. Kirk was wrong and space is not the final frontier.   By the way, Happy National Pecan Pie Day!

[Smootus]

A State Judge friend of mine told me there will be some strange bedfellows in the deal. Follow the money wil be hard as there are several hands in the pot 

[817 Boxing B]

It's getting 🔥 in hurrrr.... 🤣. Sark n the staff have played this the right way, guys. How many of our committed guys have wonky deals that are in jeopardy? Im not thinking any... maybe I'm being naive, but I don't think so. We wanna play football, not be in litigation with half our class about NIL deals. I respect the way Sark and Prime have navigated this NIL space as coaches. Different methods and perspectives, but a standard and culture have been implemented that is evident, and they won't get out of character, no matter what changes come. 

[horns96]

Was the "valid business purpose" language in the settlement?  The logic in the "terse letter" from the House plaintiffs makes no sense.  I guess the entire argument surrounds whether collectives serve a "valid business purpose" beyond recruiting enticements?

 

[Jc Dobbs]

This article is the first time I have read about Deloitte using an ALGORITHM they developed to evaluate proposed deals. There's some litigation guaranteed. I'm so old...I envisioned a dozen or so Deloitte accountants/consultants sitting in a meeting room going over the proposals. Silly old fashioned me.

I know it's way early in the new process, but it sounds like the new "rules" are seeking to force each university to pay all 85 of their players under the total of the $20.5 million cap. If done totally equally... one eighty-fifth of $20.5 mil per player. Of course, it won't be done totally equally.

Any NIL deals in addition to a player share of the cap $ ... would need to be very directly in service of a player promoting a business/product. The fact that the scrutiny begins at $600 shows how the new regulatory scheme is NOT thinking big.

Anyone know if I'm close on this or is it too early to tell?

Hook 'Em!