The intersection of intellectual property law and collegiate athletics has reached a historic turning point. The recent approval of the House v. NCAA settlement1 represents the most significant transformation in college sports since the NCAA’s founding, fundamentally altering how amateur athletes can monetize their name, image, and likeness (NIL). To understand the magnitude of this change, we must first examine the legal foundation that makes it possible: the right of publicity.
Legal Foundation
The right of publicity is a relatively modern legal concept that protects an individual’s exclusive right to control and profit from the commercial use of their name, image, likeness, and other identifying characteristics. Unlike privacy rights, which protect against unwanted intrusion, publicity rights are economic rights designed to prevent others from unfairly profiting from a person’s identity.
History
The right of publicity emerged in the mid-20th century as courts recognized that celebrities and public figures had legitimate economic interests in their identities. Haelan Laboratories, Inc. v. Topps Chewing Gum, Inc.,2 first articulated this principle when a federal court ruled that a baseball player had the right to control commercial use of his photograph on trading cards.
State Frameworks
Today, approximately 30 states have enacted specific right of publicity statutes, while others recognize the right through common law. California’s Civil Code §3344.1 and New York’s Civil Rights Law §§50-51 are the two most prominent state NIL statutes in the country. These laws vary significantly in scope and protection, creating a complex patchwork of regulations that affect how NIL rights are exercised and enforced.
Key variations among state laws include:
- Duration of Protection: some states limit protection to an individual’s lifetime, while others extend rights for decades after death. California, for example, provides 70 years of post-mortem protection, while Tennessee offers protection in perpetuity for certain celebrities.
- Scope: while all jurisdictions protect name and likeness, some extend protection to voice, signature, catchphrases, and other distinctive characteristics. Indiana’s statute, for instance, explicitly includes “gesture” and “mannerism” within its definition of protected identity elements.
- Commercial Use: states differ on what constitutes actionable commercial use. Some require direct advertising or promotional use, while others apply broader interpretations that include any use for commercial advantage.
- Transferability: most modern statutes allow publicity rights to be licensed, assigned, or inherited, though some jurisdictions restrict these transfers or require specific formalities.
Key Legal Elements
To establish a right of publicity claim, plaintiffs typically must prove:
- Identity Use: defendant used the plaintiff’s name, likeness, or other protected identity element;
- Commercial Purpose: use was for commercial advantage or economic benefit;
- Lack of Consent: plaintiff did not authorize the use;
- Economic Harm: the unauthorized use caused economic damage or deprived the plaintiff of potential licensing revenue.
Amateurism Model
For decades, the NCAA’s amateurism rules created a unique paradox in American sports law. While professional athletes routinely licensed their NIL rights for substantial compensation, college athletes—despite often generating millions in revenue for their institutions—were prohibited from receiving any compensation beyond scholarships and limited benefits.
The NCAA’s restrictions went far beyond simple limits on pay-for-play. Until recent years, athletes could face penalties for activities as mundane as accepting free meals, selling autographs, or appearing in local advertisements. These rules effectively transferred the economic value of student-athletes’ publicity rights to the NCAA and member institutions, creating what critics argued was an exploitative system.
The legal challenge to these restrictions gained momentum through several landmark cases. In O’Bannon v. NCAA,3 former UCLA basketball player Ed O’Bannon successfully argued that the NCAA’s prohibition on NIL compensation violated federal antitrust law. While the immediate impact was limited, the case established important precedent for future challenges.
House v. NCAA Settlement
On June 6, 2025, Judge Claudia Wilken of the U.S. District Court for the Northern District of California approved the $2.576 billion class action settlement in House v. NCAA. This approval represents the culmination of years of legal challenges and marks the beginning of a new era in college athletics.
Settlement Terms and Structure
The House settlement resolves multiple consolidated lawsuits challenging NCAA restrictions on student-athlete compensation. The agreement addresses four primary areas where the NCAA’s rules were found to violate antitrust law:
- Historical Damages: $2.576 billion in damages distributed over 10 years to compensate athletes harmed by past restrictions. This massive fund will provide retroactive compensation to athletes who competed between 2016 and 2024 and were denied the opportunity to profit from their NIL rights.
- Revenue Sharing: schools can share up to 22% of their athletic revenue with athletes — an estimated $1.6 billion in new compensation annually. This provision effectively institutionalizes pay-for-play within college athletics, allowing universities to directly compensate athletes for their contributions to revenue generation.
- Scholarship Expansion: the settlement eliminates traditional scholarship caps, potentially enabling more than 115,000 new scholarships. This change dramatically expands access to college athletics and reduces the artificial scarcity that previously limited opportunities.
- Modified NIL Framework: while preserving broad NIL rights for athletes, the settlement implements modified NIL restrictions, narrowing NCAA authority to prohibit NIL payments only from highly affiliated third parties, with arbitration protections for athletes.
Addressing Implementation Challenges
The settlement faced significant objections during the approval process, particularly regarding roster limits and Title IX compliance. Judge Wilken addressed these concerns while approving the overall framework:
- Athletic Program Reductions: The court acknowledged concerns about athletes potentially losing roster spots due to new compensation structures. The final agreement includes protections for current athletes and recent recruits, ensuring they won’t be displaced by immediate implementation of roster limits.
- Title IX Compliance: Some objectors argued the settlement favored male athletes in damage distributions and failed to require Title IX compliance for future payments. The court ruled that Title IX does not apply to damage distributions from the settlement fund, though schools remain obligated to comply with Title IX in their direct payments to athletes.
- Employment Status: The settlement explicitly preserves the possibility of future litigation over whether athletes should be considered employees, keeping the door open for collective bargaining and labor law claims.
Practical Implications
The House settlement creates both opportunities and challenges for all stakeholders in college athletics:
Student-Athletes
The new framework provides unprecedented financial opportunities. Athletes can now benefit from multiple revenue streams:
- Direct payments from their institutions based on revenue sharing formulas
- Traditional NIL deals with third-party sponsors and businesses
- Retroactive compensation for past restrictions for eligible athletes
- Expanded scholarship opportunities
However, this new landscape also requires greater financial literacy and professional guidance. Athletes must navigate complex tax implications, understand contractual obligations, and manage their personal brands more strategically than ever before.
Universities
Institutions face significant operational changes as they implement revenue-sharing programs. Athletic departments must develop new budgeting models, compliance systems, and administrative structures to manage direct athlete payments while maintaining Title IX compliance and competitive balance.
The elimination of scholarship caps also requires strategic planning around roster management, facility capacity, and coaching resources. Some sports may see dramatic increases in participation opportunities, while others may face practical constraints on expansion.
Third-Party Partners
The settlement’s NIL provisions create a more regulated environment for booster involvement. While athletes retain broad rights to enter NIL agreements, payments from “associated entities or individuals” face greater scrutiny and potential restrictions. This change requires boosters to structure their support more carefully and may push some activities toward more transparent, arms-length transactions.
Best Practices
As this new era begins, several best practices emerge for different stakeholders:
Athletes
- Seek professional representation for significant NIL deals and revenue-sharing negotiations
- Understand tax implications of all forms of compensation
- Maintain academic eligibility and compliance with remaining NCAA rules
- Develop long-term financial planning strategies
- Build authentic personal brands that extend beyond athletic performance
Universities
- Implement robust compliance programs that address both traditional NCAA rules and new revenue-sharing requirements
- Develop transparent, equitable systems for distributing shared revenue
- Invest in educational resources to help athletes understand their new rights and responsibilities
- Maintain Title IX compliance across all compensation programs
- Prepare for potential future changes in employment law
Conclusion
The House v. NCAA settlement marks the end of the NCAA’s amateurism model as it has been known for over a century. By recognizing the legitimate economic interests of student-athletes in their name, image, and likeness rights, the settlement aligns college sports with fundamental principles of American intellectual property law.
The implementation of this new framework will undoubtedly face challenges and require continued refinement. Questions about competitive balance, educational mission, and long-term sustainability remain unresolved. However, the fundamental shift toward recognizing student-athletes as partners rather than mere amateurs represents a historic step toward fairness and equity in college sports.
While era of the amateur college athlete is ending, the new age of the professional collegiate athlete has just begun – including the legal issues and liabilities that it may incur.
For more information, please contact Yonaxis I.P. Law Group.