NIL Court Cases: The Future of Student-Athletes

An important change is coming to NCAA athletics next year. A settlement, coming from three class-action lawsuits (House v. NCAA, Carter v. NCAA, and Hubbard v. NCAA), will establish a revenue-sharing model in universities and colleges around the United States. Beyond name, image, and likeness (NIL) deals, changes to athletic scholarships and roster sizes play massive roles in this settlement. I’d like to dive into the relevant information, the changes you can expect to see, and the future of student-athletes.

All three lawsuits address student-athletes’ inability to receive payment for their athletic performances, both past and present. A settlement agreement between the parties states that the NCAA and all Division I schools will collectively pay $2.8 billion to former Division I athletes over the next 10 years. Only athletes from 2016 to the current day are eligible for this compensation (known as backpay), which tries to address the student-athletes’ missed revenue from NIL. Besides former athletes, current and future student-athletes will work with a new ten-year revenue-sharing system. Schools can share up to 22% of an average power conference school’s revenue with its student-athletes. The base number itself is roughly $22 million and will increase throughout the next 10 years.

The revenue-sharing model, however, is not required at all. Each institution has the discretion to allocate payments from the revenue to whomever they’d like. Schools may favor the teams that generate the most revenue and begin having problems funding the lower-revenue sports. It is also important to note that all athletic scholarships are considered in this 22% figure, and these scholarships have undergone a significant change through this settlement.

Division I universities will be allowed, not required, to offer scholarships to all rostered players under the new roster limitations. These rules come with benefits and drawbacks. Roughly 800 more scholarship spots will be available through the new system. Some teams now have increased roster sizes as a whole. However, there is no guarantee that all rostered players will be given scholarships. These limitations also significantly affect some teams, especially football. While scholarships have gone up, the overall roster has decreased. The University of Nebraska, for example, has a roughly 150-player roster and now only 105 roster spots, meaning that this team will have to cut many players. This pattern will likely continue in sports like cross country and volleyball, which tend to have large rosters that will be nearly chopped in half by the new limitations.

Current scholarship athletes are protected from these cuts, which means the majority of student-athletes removed from their teams will be walk-ons. The walk-on athlete, a staple in college sports, receives many benefits from being on their respective team. Medical care, travel costs, meals, and stipends all go into these student-athletes. Not only are these teams hindered by losing players, but these students now face significantly harder financial situations. Beyond the walk-ons, some incoming student-athletes are receiving messages from schools that tell them their roster spots were eliminated, and their athletic scholarships are taken away as a result. These roster limitations will continue to affect student-athletes for years to come. This year alone, around 3,000 roster positions will be eliminated across 68 conference schools.

The situation surrounding NIL, revenue-sharing, and scholarship increases (with possible roster decreases) is very complex and difficult to follow by itself. These universities and colleges also need to consider Title IX law and how that plays into the opportunities they present each sport. It may become a tricky slope to navigate when deciding which men’s and women’s teams to allocate revenue payments and opportunities for scholarships.

There’s also the possibility that these revenue-sharing models and NIL deals lead to a more professional-style relationship between student-athletes and universities. Student-athletes could be recognized as official employees by the institutions, giving athletes a new avenue in payment options through minimum wage and overtime pay. While this may seem unlikely now, it certainly could come in the near future with a different lawsuit. An attempt like Dartmouth College’s basketball union could be quite possible at other colleges nationwide.

While this settlement concerned Division I schools, the trickle-down effect is imminent for other institutions participating in Division II and III athletics. The backpay that the NCAA must give to former student-athletes will require major budget-watching from the association. The NCAA’s financial distribution will most likely take a hit, requiring Division II and Division III institutions to pay more for their post-season championships. Amherst College and its fellow NESCAC members should closely monitor that last detail since these extra costs could mean cuts in other areas.

The student-athlete status quo is altering quickly. Amherst College does not have to worry about backpay for athletes, but it will certainly deal with the NCAA’s consequences from this action. The revenue-sharing model will set the stage for Division II and Division III student-athletes to test how to receive payment for their athletic performance. Don’t be surprised if these institutions one day adopt the methods and behaviors that the Division I institutions will exhibit in the 2025-2026 school year. However, this is still speculation since the settlement is not officially approved. On April 7, 2025, the court will have the final approval hearing for this lawsuit and likely confirm the settlement’s terms. Until then, the fate of many student-athletes remains uncertain.