NCAA Settles with Power Five Conferences, Allowing Direct Payments to Athletes

In a groundbreaking move, the NCAA has settled with the Power Five conferences, paving the way for college athletes to receive direct compensation for their contributions. The settlement marks a significant shift in the landscape of college sports.

The NCAA has reached a groundbreaking settlement with the Power Five conferences – the Big Ten, SEC, Pac-12, Big 12, and ACC – that will allow student-athletes to receive direct payments for the first time in history. The settlement was announced by law firms Hagens Berman and Winston & Strawn LLP, which acted on behalf of the plaintiffs in a class-action antitrust lawsuit against the NCAA.

According to the settlement, each school within the Power Five conferences can distribute up to approximately $20 million per year to athletes in addition to the scholarships, third-party NIL earnings, healthcare, and other benefits they already receive. As college revenues escalate, the benefits and payments to athletes will also increase over the 10-year settlement period.

Steve Berman, managing partner and co-founder of Hagens Berman, praised the settlement as a monumental step forward for college sports. "This landmark settlement will bring college sports into the 21st century," Berman said. "College athletes can finally receive a fair share of the billions of dollars of revenue that they generate for their schools."

Jeffrey Kessler, co-executive Chairman of Winston & Strawn, played a key role in negotiating the settlement. The NCAA has often faced criticism for its restrictions on athlete compensation, which have been seen as unfair and exploitative. This settlement addresses those concerns by providing legal protections for athletes who wish to receive a share of the settlement funds.

However, the settlement also includes provisions that bar athletes from pursuing further antitrust lawsuits against the NCAA. This condition has raised concerns among some critics who believe it could limit athletes' ability to advocate for their rights in the future.

The settlement comes amidst a rapidly evolving landscape for college sports, with the rise of NIL deals and the transfer portal. Athletic directors expressed hope that the settlement will pave the way for a more equitable system where success on the field is not solely dependent on financial resources.

"I think we have a chance right now to really reshape the model in the most meaningful way of any of our lifetimes," said Josh Whitman, Illinois athletic director and chair of the NCAA's Division I Council.

The settlement must still be approved by Judge Claudia Wilken, who is presiding over the antitrust lawsuits against the NCAA. If approved, the settlement will have a profound impact on the future of college sports, potentially transforming the way athletes are compensated and protected.

As the NCAA continues to navigate the complexities of athlete compensation and player rights, it remains to be seen how this settlement will shape the landscape of college sports in the years to come.