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- House attorneys slam NCAA and power conferences over denied NIL deals, issue legal warning about settlement</p>
<p>Ross DellengerJuly 11, 2025 at 4:56 PM</p>
<p>In another twist in college athletics' new revenue-share era, attorneys for the plaintiffs in the House settlement believe the NCAA and power conferences are violating terms of the legal agreement and are threatening to report the wrongdoing to the court.</p>
<p>In a terse, two-page letter sent to NCAA and power conference officials Friday, Jeffrey Kessler, a co-lead House plaintiff attorney along with Steve Berman, requested that the NCAA and conferences "retract" a statement of guidance released Thursday from the College Sports Commission and, presumably, reinstate name, image and likeness deals that the CSC has denied — many of them from booster-backed NIL collectives.</p>
<p>In his letter, Kessler describes the guidance as "not consistent" and "undermining" settlement terms, according to a copy of the document Yahoo Sports obtained. The CSC, the new revenue-share enforcement arm policing NIL deals, notified schools Thursday that it was denying dozens of NIL deals for not meeting what it terms a "valid business purpose." The guidance specifically targeted collectives, entities that for years now have paid millions to athletes through booster donations.</p>
<p>In the letter, attorneys write that collectives should not be treated differently as other businesses.</p>
<p>"There is nothing in the Settlement Agreement to permit (NCAA and conference) or the CSC, acting on their behalf, to decide that it would not be a valid business purpose for a school's collective to engage in for-profit promotions of goods or services using paid-for student-athlete NIL," the letter reads. "To the extent the NIL payment is for the promotion of a valid business purpose, it is irrelevant whether that payment comes from a NIL collective or any other third party."</p>
<p>Attorneys are planning to bring the issue before Judge Nathanael Cousins, the appointed magistrate in the settlement who has been appointed to resolve such disputes.</p>
<p>"We urge the CSC to retract the July CSC Memorandum and clarify that the valid business purpose requirement applies to NIL collectives in the same manner as any other entity," the letter reads.</p>
<p>The letter was addressed specifically to the NCAA's outside counsel, Rakesh Kilaru, the organization's lead attorney and one of the key designers of the settlement. on the letter were the general counsels of the Big Ten, Big 12, SEC, ACC and Pac-12 — all named defendants in the case.</p>
<p>In a statement to Yahoo Sports, an NCAA spokesperson said the association has "no role in these decisions" and to seek comment from the CSC.</p>
<p>A CSC spokesperson provided this statement to Yahoo Sports: "The guidance issued by the College Sports Commission yesterday is entirely consistent with the House settlement and the rules that have been agreed upon with class counsel. The defendants have been in close coordination with class counsel on the key provisions in the memo and will continue to work with them to resolve any concerns they may have."</p>
<p>In the letter, Kessler notes that the "valid business purpose" rule in the settlement "was meant to prohibit NIL collectives from simply receiving donations and paying athletes for play," it reads. "It does not, however, prohibit a NIL collective from paying athletes itself — not as a marketing agent for others — if the payment is 'for a valid business purpose' related to the promotion or endorsement of goods or services provided to the general public for profit."</p>
<p>Some of the collective deals paid athletes to attend autograph signings or make event appearances for payment — all of which should be deemed legal, according to the letter.</p>
<p>This issue is not insignificant. In fact, prohibiting collective pay is at the center of the House settlement, a multi-billion dollar agreement the NCAA and power leagues struck to settle three antitrust cases.</p>
<p>The goal of the agreement, in part, is to shift athlete pay from booster-run collectives to schools that are now permitted to directly share revenue with athletes under a capped system that began July 1. However, many schools are still operating their collectives as a way to provide third-party compensation to athletes that does not count against a program's cap — a way to, perhaps, legally circumvent the system.</p>
<p>The College Sports Commission, an entity created and currently administered by the power conferences, is charged with enforcing prohibitions around collective pay. Athletes must submit any third-party deal of $600 or more to an NIL clearinghouse, NIL Go, that uses a Deloitte-created algorithm to determine if the deal meets certain standards, including a "compensation range" and a "valid business purpose" definition.</p>
<p>Those deals flagged by NIL Go are sent to the CSC and its new leader, Bryan Seeley, to determine an enforcement decision. As of Thursday, about 80 of more than 2,000 submitted deals have not been cleared, with several more denials expected this week based on the commission's latest guidance. More than 1,500 deals have been approved.</p>
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