On Monday, U.S. District Judge Claudia Wilken will hold a hearing to determine if she should grant final approval to the settlement between the NCAA and current and former D-I athletes represented by the House, Carter and Hubbard antitrust litigations. Sportico’s Michael McCann, who is also an attorney and law professor, answers 20 key questions.
1) When does the hearing start and what is at stake?
The hearing is scheduled to start at 10 a.m. Pacific time in Oakland’s federal courthouse and will last the day. The primary purpose is for Wilken to determine if the proposed settlement is fair, reasonable and adequate to the settlement classes and that it sufficiently addresses the antitrust issues raised in the three cases.
If Wilken determines the settlement meets that test, she will grant final approval and set a schedule for when and how the settlement is implemented. Wilken will also address fees and expenses that should be awarded for the plaintiffs’ attorneys; they seek nearly $500 million.
2) Who will speak during the hearing?
The primary speakers will be Wilken and the lead attorneys—Jeffrey Kessler, Steve Berman and Rakesh Kilaru. LSU gymnast Livvy Dunne and 13 other athlete objectors or their attorneys are expected to appear in person or by Zoom and will be able to state their grievances.
3) How much control will Wilken have over the hearing?
She will have total control and can interject at any time. Everyone will follow Wilken’s lead.
Having been in Wilken’s courtroom, I can share that she can ask very difficult questions that fluster attorneys. She has been the presiding judge in the major antitrust cases against the NCAA over athlete compensation, including those brought by Ed O’Bannon and Shawne Alston. Wilken is as knowledgeable about the relevant legal issues as any judge in America.
4) What is the best argument in favor of approval?
The settlement represents a massive and historic infusion of money and economic opportunities for college athletes that, for the upper echelon of Division I, ends the longstanding and long-criticized system of amateurism.
The settlement would pay, over a 10-year period, damages of about $2.8 billion to D-I athletes dating back about eight years. The damages would reflect lost NIL, video game and broadcasting opportunities on account of eligibility rules.
The settlement also creates a new structure where colleges that opt in can share up to 22% of the average power conference athletic media, ticket and sponsorship revenue with their athletes, with $20.5 million expected to be the initial annual cap. Keep in mind those direct payments are in addition to both athletic scholarships, which cover tuition, housing, health resources and other benefits, and NIL deals athletes sign with third parties. The settlement also ends scholarship limits, meaning colleges can offer a greater number of full (or partial) scholarships to their athletes.
All told, it’s expected that colleges will split about 50% of athletic revenue with athletes. That type of share is one that pro leagues and their respective players’ association tend to use in determining players’ share of revenue.
5) What happens if Wilken rejects the settlement?
The cases would return to the docket. They could face many years of litigation during which athletes are not paid and current rules likely remain in place.
6) Wouldn’t the players be favored to win the cases if they return to the docket?
Don’t be sure. Wilken has made it clear she is sympathetic to the players’ arguments, and she sided with O’Bannon and Alston in their cases. But Wilken’s not the final word.
For one, a jury could side with the NCAA. The U.S. Court of Appeals for the Ninth Circuit, which has emphasized that college payments to college athletes should be tethered to education (and not to playing sports), could also side with the NCAA.
Then there’s the U.S. Supreme Court. Although the NCAA lost NCAA v. Alston 9-0 at the U.S. Supreme Court, that case had nothing to do with NIL or paying college athletes to play sports. The ruling in Alston does not indicate how the Supreme Court would address cases about NCAA rules related to compensation for athletes for their NIL and playing sports.
7) There have been many objections, so isn’t Wilken unlikely to grant approval?
That question is off base in a couple of ways.
First, there haven’t been many objections or opt-outs. Out of nearly 390,000 class members, only 343 (about 0.088%) opted out and only 73 (about 0.019%) filed objections. Those are tiny percentages and, if anything, represent a reason for Wilken to approve the settlement.
Second, while the standard of review for final approval is not a rubber stamp, it is also not the hardest to meet. Judges in applying the “fair, reasonable and adequate” standard have stressed it does not require perfection, does not require class members to receive equal compensation and does not invite judges to meddle with an agreement the parties have negotiated. Odds are Wilken will grant final approval.
8) What exactly are Wilken’s options?
There are effectively three choices for Wilken.
First, she could grant final approval, which is the most likely outcome. She would then set a schedule for its implementation.
Second, she could tell the attorneys she is inclined to grant final approval only if certain changes are made. That would effectively delay the timeline, but give the attorneys a chance to remedy terms Wilken disputes. Whether the two sides can come to an agreement is another matter; the settlement reflects concessions by both sides and distributing that balance would make one side feel it’s better to resume litigation than accept unfavorable terms.
Third, and least likely, she could deny final approval. As noted earlier, the cases would return to the docket and could remain in court for many years absent another settlement.
9) If the settlement violates Title IX, how could Wilken approve it?
It’s unclear if the settlement violates Title IX, and that issue won’t be resolved in the settlement approval phase.
There are logical, though debatable, arguments that the settlement paying male athletes more in damages and permitting colleges to pay male athletes more going forward is problematic under Title IX. The U.S. Department of Education in the administration of President Joe Biden argued that point.
But Wilken has stressed that the litigation before her raises antitrust claims—not claims under Title IX, employment law and other areas of law that might provide for future claims.
Antitrust claims concern agreements by NCAA member schools and conferences to restrain how each individually competes for, and compensates, athletes. Antitrust law centers on market and economic impacts.
To that point, it’s notable that despite Wilken being presented with a thorough and multifaceted set of objections (including those based on Title IX) prior to the preliminary approval hearing, her areas of concern during that hearing focused on whether the settlement might deprive athletes of monetary opportunities to license their NIL.
Expect to see Title IX lawsuits should Wilken approve the settlement, but those would be different cases.
10) Will Wilken announce her decision during the hearing?
That’s up to her, but the typical approach would be for Wilken to conclude the hearing by stating she’ll take the arguments under advisement and will issue a written order in due course. The written order would likely be issued within a month, though the timing is entirely up to Wilken as the presiding judge. In other words, there’s a good chance the hearing ends without Wilken granting or denying final approval.
That said, Wilken will likely signal which way she is leaning. During the hearing for preliminary approval last fall, Wilken strongly indicated she would not grant preliminary approval unless the parties reworked language concerning NIL and addressed several other points. That led the parties to restructure the settlement to specifically address Wilken’s concerns. She then granted preliminary approval.
11) But doesn’t Wilken know that colleges expect the settlement to go into effect soon?
To put it bluntly, that’s not Wilken’s problem.
She is no doubt aware that many colleges, conferences and college sports businesses are acting as if her granting final approval is a done deal. That’s a risk they are taking. Wilken won’t rush her decision on a settlement that would impact hundreds of thousands of college athletes—if not millions of college athletes given that it is a 10-year agreement—merely because the businesses of college sports want her to meet their deadlines.
12) If Wilken grants approval, when would the settlement go into effect?
The settlement would likely go into effect at the start of the 2025-26 academic year, which at many schools will begin on July 1. The new academic year brings new enrollment and a new academic year budget, so it’s a sensible time to start a new system.
Wilken also knows that colleges have been aware of the settlement’s terms since last summer—it’s not as if colleges haven’t been on notice for a while and haven’t had the chance to prepare.
13) These are difficult times for colleges. Is that a reason to delay the settlement?
The short answer is no.
The longer answer is that Wilken is no doubt aware that, as widely reported, many colleges are facing severe, even existential, financial problems. The federal government is slashing government funding for university research. The enrollment cliff, where there is a long-anticipated drop in the population of U.S. adults who are of college age due to declining birth rates, hits this year, meaning colleges will compete for fewer students and their tuition dollars. Colleges are also worried about the impact of immigration policies under President Donald Trump on the recruitment of international students. Fears of a recession, more acute given new tariffs and the abrupt drop in the stock market last week, also present sizable worries.
While Wilken may be sympathetic to colleges’ financial situation, that’s not a legal reason to delay when the settlement starts. These colleges, through their membership in the NCAA and, for some, also membership in power conferences, have negotiated a settlement to resolve their litigation. It’s a choice they will need to live with.
14) Won’t the settlement conflict with state laws?
Probably, but that likely won’t dissuade Wilken from approving the settlement.
Last year Wilken was warned by objectors that the settlement’s terms appear to conflict with several states’ laws. She still granted preliminary approval.
A handful of states have used law-making and executive orders to block the NCAA from enforcing rules related to NIL and compensating athletes. That’s a problem with the settlement since college athletes’ NIL deals with third parties that exceed $600 can face independent review to ensure those deals aren’t pay-for-play arrangements cloaked as NIL deals.
This conflict is likely to trigger litigation in those states when an NIL deal is blocked on account of being deemed pay-for-play. The athlete who is denied the deal could seek an injunction in court arguing that the NCAA is in violation of state law. As explained by Sportico, that would lead the NCAA to argue the state law violates the U.S. Constitution, specifically the Commerce Clause, which forbids states from adopting laws that unduly interfere with other states’ economies, and the Contract Clause, which bars states from impairing contracts (including membership agreements like those between the NCAA and member schools).
That’s a legal fight for another day and, like Title IX issues, is not before Wilken in this case.
15) Aren’t roster limits a major problem with the settlement?
The elimination of athletic scholarship caps comes with the imposition of roster limits that will lead to some athletes, particularly walk-ons, losing spots. FBS football rosters will be capped at 105, which at many schools is about 15 spots fewer than typically used. Objectors have logically argued these roster caps are detrimental to roster-spot losing class members since their chance to play a sport at a college will be lost.
Wilken will likely address this topic in the hearing. Expect counterarguments to include that some of the roster limits are set higher than roster sizes normally used and that the net benefit to class members is a positive since the dropping of athletic scholarships will mean much more money going to athletes.
16) Wouldn’t the settlement function as a labor agreement except without labor?
That has been a critique of the settlement—that the settlement, especially with a de facto salary cap, resembles a collective bargaining agreement that a pro league would sign with a players’ association. Except here there is no players’ association. Such an association might negotiate a higher percentage of the revenue share than 22% or other benefits for college athletes.
The counterargument is that the system doesn’t allow for a CBA. As of now, college athletes aren’t recognized as employees. They therefore can’t unionize, which requires, among other things, employment recognition. Without a union, there can be no CBA under labor law.
So while the settlement does resemble a CBA without union involvement, one could argue that’s the best college athletes can do at this time when an actual CBA is not possible.
Also, keep in mind a settlement takes two to tango. It requires the NCAA to say yes, too. The NCAA would not agree to a settlement that lacks cost controls. The notion that a union could negotiate more is arguably a red herring, since there is no union, and a class action settlement negotiation is not a CBA negotiation.
17) Doesn’t the settlement make the players employees?
No. Whether a player is an employee is a separate legal question, involving other areas of law not addressed by the settlement. The settlement only addresses the specific areas of antitrust law raised in those cases.
That said, expect attorneys for athletes who argue they are employees to highlight that colleges directly paying athletes sure looks a lot like employment.
18) Are future college athletes bound by the settlement?
Only if they agree to be bound. The NCAA and attorneys for the players are banking on the belief that college athletes will accept this system, which reflects a massive improvement in terms of compensation. But future college athletes can bring their own antitrust case if they want to challenge this system, though that means they don’t get paid via the settlement.
19) So, the settlement doesn’t provide certainty?
No class action settlement provides absolute certainty.
For one, class members of the class can opt out and sue, and that has already happened with this settlement: In January, former Mississippi State running back Kylin Hill led a group of fellow former D-I college football and basketball players who opted out to sue the NCAA in a Mississippi federal district court. Their case raises the same legal arguments in the House, Carter and Hubbard litigations and could remain on the docket for many years.
Also, future athletes must agree to be bound by the deal. It stands to reason some won’t. There are also Title IX, state NIL law and employment lawsuits that will be brought. The damages portion of the settlement could also face an appeal to the U.S. Court of Appeals for the Ninth Circuit.
Yet the settlement is still a major step forward in resolving NCAA legal crises. It’s not a panacea, but it’s a big step.
20) Who will oversee the settlement?
That is up to Wilken. She will likely play a role, and she might delegate some authority to a federal magistrate judge. The settlement also envisions non-judicial systems for oversight, including independent review of NIL deals.
