$2.8 B Settlement Lets NCAA Schools Pay Athletes Up to $20.5 Million Annually

A federal court in California has concluded an important chapter in college sports history, granting final approval to the $2.8 billion House v. NCAA antitrust settlement.

This landmark decision concludes five years of litigation and also effectively removes the final barriers to compensating collegiate athletes for the use of their names, images, and likenesses.

U.S. District Judge Claudia Wilken issued the ruling late Friday, addressing claims against the NCAA and its five major conferences while allocating approximately $2.7 billion to rectify past restrictions imposed on former athletes.

Effective from 1 July, every Division I institution will be allowed to distribute up to $20.5 million annually in broadcast and sponsorship revenues to current student-athletes, in addition to enabling individual name-image-likeness (NIL) deal opportunities.

This settlement also earmarks a minimum of $475 million for the plaintiffs’ attorneys, a figure that may escalate to $725 million.

Moreover, it introduces a soft salary-cap structure, which has raised concerns among critics regarding potential future litigation related to Title IX compliance and the limits on athlete compensation.

To ensure adherence to this new compensation model, the settlement establishes the College Sports Commission and an NIL clearinghouse, both headed by former Major League Baseball executive Bryan Seeley.

Leaders from the SEC, ACC, Big Ten, Big 12, and Pac-12 expressed that the newly defined framework offers “transparent, enforceable rules.”

SEC Commissioner Greg Sankey described the decision as presenting an “opportunity for stability and fairness,” while Big 12 Commissioner Brett Yormark highlighted that violations would incur “punitive” repercussions. Additionally, the group called upon Congress to establish uniform national standards across the board.

Athletic departments nationwide are now faced with the challenge of funding these forthcoming payments.

Industry legal experts anticipate ongoing challenges pertaining to the settlement’s NIL oversight provisions and how universities will equitably distribute revenue between men’s and women’s programs.

The implications of this upheaval extend well beyond campus walls, as coaching associations are urging lawmakers to protect non-revenue sports.

Notably, President Donald Trump raised the topic during a recent golf outing with SEC Commissioner Sankey and Notre Dame athletic director Pete Bevacqua.

While leaders from power conferences are optimistic that this new system will ultimately restore order to an increasingly chaotic marketplace, they acknowledge that the implementation of such a significant change—marking the most substantial alteration in the NCAA’s 118-year history will likely entail considerable “growing pains.”

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