Intellectual Property, Sports

Student Athletes 1, NCAA Nil

If they haven’t yet, student-athletes will quickly need to get up to speed on IP issues.

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(Photo by Streeter Lecka/Getty Images)

The gold rush has begun. In the short period since the Supreme Court’s unanimous affirmance in NCAA v. Alston that existing restrictions on providing education-related benefits to student-athletes at NCAA schools were improper, a quick-fire series of developments has unfolded. On Wednesday, the NCAA issued a “uniform interim policy suspending NCAA name, image and likeness rules for all incoming and current student-athletes in all sports,” with near-immediate effect. And within minutes of the policy going into place after midnight last Thursday, the first sponsorship deals with NCAA student-athletes were struck. At a minimum, that flurry of deal announcements is evidence of the pent-up commercial demand for student-athlete endorsements, fueled both by the tremendous interest in college athletics by the general public, as well as the savvy use of social media by student-athletes themselves.

Unsurprisingly, much of the early endorsement activity involved student-athletes with established social media presences. In perhaps the highest-profile deal, Fresno State basketball stars and twin sisters Haley and Hanna Cavender signed with Boost Mobile, ostensibly on the strength of their millions of social media followers. But they were not the only ones to announce immediate deals. From the hundreds of current athletes who signed up with video-game matchmaker Yoke, to Auburn quarterback Bo Nix’s (nearly 100,000 Instagram followers) endorsement deal with a sweet tea company, to the list of athletes who announced the launch of their apparel lines, the floodgates are definitely open.

But with opportunity comes responsibility — and in my view the primary responsibility for ensuring that student-athletes don’t get exploited by more savvy commercial counterparties lies with the athletic departments at the NCAA schools. They are the ones who benefit most directly from the athletic prowess of the students, while also being entrusted by parents with the care of their children. At a minimum, athletic departments must make sure that student-athletes are fully informed about the different policies they need to comply with in terms of exploiting their names, images, and likenesses (NILs). Whether it is the NCAA’s interim policy, or school or athletic conference policies, or even with respect to the anticipated federal legislation coming down the pike, there is no excuse for athletic departments leaving their athletes to fend for themselves in this area. Just as they make sure that athletes get the best coaching in their sports, so should they ensure that student-athletes get access to guidance around their newfound freedoms.

For all the excitement, caution is also warranted with respect to commercializing NILs. Established brands will be wary of doing endorsement deals with sometimes-immature athletes operating in a college environment fraught with risks from a negative headline perspective. And athletes should resist the temptation to associate themselves with the first businesses showing interest, because no young person wants to become tainted because of an affiliation with an unsavory entity. Moreover, because of the regulatory uncertainty in this fast-developing area, resisting the temptation to jump into deals might be advisable — especially for athletes of some renown, whether because they are, for example, in prestige sports at big schools or Olympic hopefuls. In short, the more promising the prospects, the more a professional approach to deal-making is warranted. On the legal side of things, I would also hope that lawyer-alumni would be willing to donate some time to helping students at their alma mater avoid trouble in these uncharted waters as well.

While I tend to agree that for the vast majority of student-athletes the freedom to exploit their NILs commercially will be of limited financial value, there should also be no doubt that for many college students, even modest sums can have a disproportionate impact on their quality of life for the better. At the same time, we don’t want students to prejudice their educational prospects by focusing too much on NIL marketing efforts, especially since athletic pursuits are so demanding of their time in the first place. While college staff and families will surely help provide guidance to students, it also helps that so many of our youth are intimately familiar with social media and understand the value of being influencers when hawking products and services. For the new scheme to work, we must hope that bad actors looking to exploit students are kept out, that students learn to strike a balance between commercial activity and their educational/athletic obligations, and that those in a position to help students step forward.

Since I have long touted the value of educating youth in IP awareness, I must say that I am enthused at the prospects of these new developments with respect to college athletes helping to advance that cause. If they haven’t yet, student-athletes will quickly need to get up to speed on IP issues, from understanding copyright issues related to use of their likenesses, to trademark issues with respect to their personal brands — and much more. And as the market for amateur athlete endorsements matures, the need to educate student-athletes on IP awareness will arise even earlier in their careers, perhaps even at the middle school, if not the high school level for sure.

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Ultimately, it is nice to hear that what many have long considered an exploited group will now be getting an opportunity for remuneration in some capacity. There is no doubt, however, that a lot of the NIL value ascribed to student-athletes arises by virtue of their association with well-known commercial brands (i.e., their schools). To what extent schools decide to regulate the activity of students with respect to NILs remains an open question. But we have already seen enough action to know that a run of deals in the best tradition of a gold rush is already underway, uncertainty be damned. And that for what seems like the first time in a long time, the NCAA has been shut out of its longstanding attempts to restrict student-athletes from making some side money. Let’s hope everyone puts the interests of the student-athletes first as we move ahead in this new environment.

Please feel free to send comments or questions to me at gkroub@kskiplaw.com or via Twitter: @gkroub. Any topic suggestions or thoughts are most welcome.

Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique, and Markman Advisors LLC, a leading consultancy on patent issues for the investment community. Gaston’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at gkroub@kskiplaw.com or follow him on Twitter: @gkroub.

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