What the SCOTUS NCAA decision means for branded varsity athletic wear and promotions
The writing has been on the wall for a while, but a U.S. Supreme Court ruling brings the idea that college athletes can enjoy their name, image and likeness closer to reality .
SCOTUS upheld a district court ruling that the NCAA violated antitrust law by not allowing student-athletes to receive compensation outside of education benefits. While the specific ruling is fairly narrow in scope, legal experts believe it puts the NCAA in a bad position to push back related legal challenges, especially a looming lawsuit challenging its long-standing name, name policy. image and likeness.
If this trial is completed, student-athletes would no longer be prohibited, among other things, from creating and selling merchandise in their image. This could present new business opportunities for branded merchandise companies, although the rules – and the way forward – are still rather unclear.
The NCAA is a convoluted system. Since there are so many Division I schools (357 to be exact) and multiple conferences, it is difficult to apply one rule to all schools. According to USA Today, the ACC, Pac-12 and Southeastern conferences had all come up with a proposal that would leave it up to each school to develop their own rules regarding the student-athlete’s right to profit.
Basically, if it comes to fruition, it could mean that a Villanova player has carte blanche to market their name and appearance on things like clothing, but a Duke player might not.
Now, these conferences are reassessing the proposal in response to the SCOTUS ruling, potentially further relaxing name, image and likeness restrictions to avoid violating antitrust laws. Eight states have already passed laws allowing student-athletes to earn money by their name, image and likeness as of July 1 or whenever schools close. The NCAA is currently working to find a solution for student-athletes competing in schools outside of these states.
Judge Kavanaugh: “The NCAA is making its case for not paying student athletes under harmless labels. But labels can’t hide the reality: the NCAA business model is said to be outright illegal in almost every other industry in America.
– Adam Schefter (@AdamSchefter) June 22, 2021
The NCAA Division I board, which is the association’s primary policy-making group, is due to meet next week to vote on rule changes regarding this new development.
“Because of [Monday’s] decision, it evolves as you go, ”a source familiar with the council’s plan told USA Today. “There is a healthy dialogue that will continue not only tomorrow, but throughout the week. We were looking for the best bridge from now to hopefully federal legislation that does not trigger any antitrust issues. Internal lawyers and external lawyers take a look with a sharper pencil and a more concise objective. he goes [be] adjustments [to the proposals]. The only thing that isn’t on the table is a do nothing option.
A legal expert said that from an academic point of view, the best solution would be to give schools the power to set their own rules, because “it doesn’t matter how well the rules of the conference or the school are. restrictive, they are unlikely to violate antitrust law because no single conference or school has enough market power to harm competition.
So where that leaves the promotional products industry is a place of optimistic confusion. Student-athlete merchandise represents a new source of income that would complement the current college and university market, likely without the licensing hurdles that come with it. The ability to add new products specific to star athletes opens up opportunities beyond the one-size-fits-all campaigns of a single promotion for the whole team.
But, until there is an inter-conference consensus or a standardized NCAA rule that applies to every Division I school, there will likely be some uncertainty and hurdles in trying to enter the ground floor here.
It could be the kind of market, similar to cannabis, that varies from state to state (or even school to school). But, the opportunity now exists for the branded clothing market, which is such an important part of the professional sports world, to find its way to college.