A federal judge shook up the NCAA’s rules regarding NIL compensation in recruiting by granting a temporary injunction on Friday. This decision came as part of a lawsuit linked to NCAA violations at the University of Tennessee, temporarily halting the NCAA from enforcing any rules related to third-party negotiations on NIL compensation until the case is resolved.
The lawsuit, filed by the attorneys general of Tennessee and Virginia at the end of January, raised antitrust concerns. It coincides with investigations into alleged Level I infractions at the University of Tennessee, particularly focusing on an NIL deal involving quarterback Nico Iamaleava, reportedly valued at around $8 million.
Tennessee Attorney General Jonathan Skrmetti emphasized the importance of safeguarding the rights of student-athletes, stating their commitment to challenging the NCAA’s actions. The lawsuit argues that the NCAA’s restrictions violated antitrust laws by limiting athletes’ ability to earn full compensation for their name, image, and likeness.
U.S. District Judge Clifton Corker echoed this sentiment in his decision, suggesting that the NCAA’s prohibition likely violates federal antitrust law and negatively impacts student-athletes.
While NCAA athletes gained the ability to earn NIL compensation in July 2021, certain restrictions remained in place, including limitations on using NIL opportunities for direct recruiting.
This ruling represents another legal setback for the NCAA, following a previous ruling against transfer restrictions in December. NCAA President Charlie Baker expressed concerns about the potential disruption to rules endorsed by member schools, emphasizing the importance of stability in collegiate athletics. Nevertheless, the NCAA remains committed to supporting student-athletes in monetizing their name, image, and likeness, despite ongoing legal challenges.
