Texas passes NIL law: "aimed directly at bypassing NCAA oversight"

Submitted by Ezekiels Creatures on June 10th, 2023 at 11:55 PM

 

https://twitter.com/On3NIL/status/1667686444285014017

 

 

--Texas, Texas A&M, and other state school officials played a major role in shaping the legislation

--Lawmakers in Arkansas, Colorado, Missouri, Montana, New York and Oklahoma have sponsored or passed bills in recent weeks to prevent the NCAA from launching investigations into NIL activities.

--NCAA President Charlie Baker very unhappy:  “They say screw the NCAA,” Baker said. “Screw the conference. Screw their rules.”

--this opens the door for unlimited money: "this is Texas – where everything is bigger, including the drive to see the Aggies and Longhorns succeed at the highest levels of college football."

--the most notable change appears to provide cover for state schools from being punished by the NCAA for any NIL-related violations, including any committed by collectives that have been set up to support student-athletes through deal facilitation.

--NCAA President Charlie Baker calling out the previous NCAA regime for putting him in this position: "...questions how you create a competitively-level playing field... I think it was a big mistake for the NCAA not to do a framework around NIL when they had the opportunity."

 

It also does this: "can now give donors points for NIL donations." Does anyone know how this affects those donors? What does this do for them?

https://twitter.com/WinterSportsLaw/status/1667713170578845696

 

 

This is happening when an "NIL Parity Cap" was gaining real momentum. But this pushes NIL even further into the the wild west. Will U of M have enough NIL money to keep up?

 

 

mooseman

June 11th, 2023 at 1:59 AM ^

Thanks, Matlock. Texas, Arkansas, Oklahoma, etc are free to make any state laws they want. Hell, their schools are free to withdraw from the NCAA. All this means is that, short of federal NIL legislation, there will be more litigation. These states are banking that the same favorable rulings--that athletes deserve compensation--will translate into no allowance for oversight whatsoever.

It just hastens federal legislation so maybe it's not a bad thing.

Don

June 11th, 2023 at 2:17 AM ^

“It prohibits the NCAA from penalizing Texas schools if they participate in activities allowed under the law.”

What legal statute permits the state of Texas to control what the NCAA does or doesn’t do? The NCAA is a national organization that exists independently of the state of Texas. If the NCAA wants to levy sanctions against a member school it has the right to do so under its bylaws. Texas has no more legal power to control what the NCAA does than it does to control the National Association of Manufacturers or the American Medical Association. If Texas wants to ignore the AMA’s guidelines for medical licensure it can choose to do so, but it can’t legally prevent the AMA from making its own decisions in response.

The problem for the NCAA is that membership is voluntary and its power resided only in the assent of its member institutions that gave it the power to police them. Once that voluntary assent is withdrawn, the whole edifice collapse and the NCAA has no enforcement power. So while an individual state can’t unilaterally control the NCAA’s internal decision-making, neither can the NCAA enforce any punishment if member institutions tell it to go fuck itself, which is what’s happening. They’re basically seceding from the NCAA, and the NCAA has only itself—and the unbelievably corrupt and incompetent tenure of Mark Emmert—to blame. 

 

 

 

Leaders And Best

June 11th, 2023 at 6:17 AM ^

That's the part I don't understand. You can't have it both ways. If you don't want to follow NCAA rules then leave the organization. I also don't see why the NCAA doesn't start playing hardball with these states. I can see how it would be a problem for football as the CFP is independent of the NCAA. But the NCAA should not allow these schools to participate in their championships if they are not willing to follow the same rules. And the NCAA should pull championships from these states. There are two Final Fours scheduled to take place in Texas in the future as Texas is one the biggest beneficiaries for hosting NCAA Final Fours. Take them away and any other championships from being played in their states.

dragonchild

June 11th, 2023 at 11:44 AM ^

When in the last twenty years has the NCAA ever played hardball with anyone -- except, you know, maybe cracking down on football camps for middle schoolers because the SEC whined about it?

This is the most redundant legislation ever.  There's no point in prohibiting the NCAA from doing anything when all along they have absolutely no intention of doing anything in the first place.

 

Jack Be Nimble

June 11th, 2023 at 12:06 PM ^

This entire reply shows a fundamental misunderstanding of the entire American legal order.

What legal statute permits the state of Texas to control what the NCAA does or doesn’t do?

This question is just incredibly confused. Texas, like any other state, is a sovereign entity under the American constitution with its own legislative powers. Texas does not need an external body to implement a "statute" to permit it to do anything. Texas's own statute passed by the Texas legislature is sufficient.

My guess is you mean that the federal government would need to pass a statute to permit Texas to regulate the NCAA, but that is contrary to American law. State's powers to make their own laws do not flow from the federal government. Rather, such powers are entirely independent of the federal government.

Now, I do think that you raise an important point about extraterritorial application of state law (that is, application of Texas law beyond the state of Texas), and that is actually a complex issue that has only gotten more complex with a recent Supreme Court decision. But limits on extraterritorial application of state laws are actually pretty weak, and they certainly do not prevent a state from regulating the way a multi-state or even multi-national organization operates in relation to schools within its own borders.

The NCAA could try to get out of Texas regulation by leaving the state of Texas entirely, but I'm not sure even that would work. If people in Texas were still watching NCAA games and the NCAA was still benefiting from those eyeballs, that could itself establish Texas's jurisdiction over the NCAA. Again though, jurisdiction in American law is complicated so that would probably take a long time and a lot of legal fees to work out.

Gulogulo37

June 11th, 2023 at 12:42 PM ^

Thank you. I was really confused by a couple comments above, as if somehow the NCAA being a national organization means Texas can't pass laws it's bound by. Really bizarre. The AMA comment is a good example. No, Texas can't disband the AMA, but they can pass abortion laws or a million other things that control what doctors can and can't do in Texas.

mooseman

June 11th, 2023 at 1:44 PM ^

I don't think the AMA example is what you want to use here since they are not a licensing body nor do they offer any certification.

Let's use another example. A state could pass a regressive law, let's say one that says I'm not required to provide emergency care for women or someone who is gay. That state's licensing board will not take away my license for denying care because I am compliant with state law and their legislative body runs the state board.

Certainly the American Academy of Orthopedic Surgeons can still censure me though and The American Board of Orthopedic Surgery may revoke my specialty board certification. The state, however, can still decide I am permitted to perform orthopedic surgery in that state without specialty board certification.

Gulogulo37

June 11th, 2023 at 2:28 PM ^

I wasn't talking about licensure or certification and that's not what the NCAA does, so I don't see the relevance. The point is it's the state that has the power, not the NCAA, which your example further illustrates. Even within the NCAA's purview, it has little actual power. The power is in the hands of the schools. The NCAA has no legal investigative power. They used to be able to sanction schools because the schools complied. Then schools started just telling the NCAA to kick rocks, like Harbaugh's recent run-in, and the NCAA can't do anything. Not being in compliance with state law is obviously more problematic.

Did everyone forget the NIL floodgates opened because the states passed laws and the NCAA was powerless to stop them?

mooseman

June 11th, 2023 at 4:58 PM ^

The NCAA wasn't powerless, per se. They took them to court and the Supreme Court ruled (rightly, IMO) that the NCAA couldn't restrict compensation to athletes. Kavanaugh particularly left the door open to challenge the NCAA's ability to further regulate compensation. This may or not be successful. As I said above, it just opens the way for more litigation barring some federal legislation.

The NCAA is its member institutions. They have a shared interest. A pet peeve of mine is when schools talk about how ridiculous the NCAA is. You are the damn NCAA. States and schools can do what they did after Alston and just say "ok, we'll all do what Texas is doing" or can decide that this is not the arena in which they want to compete and go their separate ways or they can lobby for overriding federal legislation.

the Glove

June 11th, 2023 at 12:06 AM ^

What stops the NCAA from saying that's cool now if you don't follow our rules you can't participate in postseason play for your other sports. Their arm is behind their back because they can't really do anything for postseason with football, but that doesn't stop them from being complete dicks in all the other sports. Even though football has the greatest effect from NIL it's not the only sport that benefits from it. The NCAA did something similar to this when not allowing offensive Native American mascots and logos.

Jack Be Nimble

June 11th, 2023 at 12:10 PM ^

What stops the NCAA from saying that's cool now if you don't follow our rules you can't participate in postseason play for your other sports.

I think the Texas law itself does. Refusal to allow participation could be considered a "penalty" and the Texas law expressly prohibits the NCAA from penalizing schools for certain actions. If the NCAA refused to allow participation by the Texas schools for actions that are expressly permitted under the law, they would be in violation of Texas law and Texas could use its sovereign power to levy fines or even more severe punishments on the organization (I don't know what the law specifies as far as penalties for noncompliance).

DennisFranklinDaMan

June 11th, 2023 at 1:17 AM ^

I mean, the other member schools in the NCAA could always agree to exclude Texas schools from their schedules, refuse to play them in bowl games, etc. They won't, obviously, but ... they could. 

I actually wonder where this is going to go. Texas is throwing down the gauntlet for pay-to-play, which opens up a Pandora's Box that's going to do terrible things to school athletic departments — at the very least a nuclear arms race will see schools forced to take money from other programs to pay players, inevitably leading some to shut some of those other sports down entirely, or start/join other leagues (a modern version of Division II) that somehow agree not to do pay-per-play, and ... how do you enforce that?

Damn, I hate NIL. Yes yes, we all agree that players should have the right to benefit from their name, image, and likeness, like every other college student. But this has morphed immediately into pure pay-per-play, and that's going to fuck up something that has brought a lot of pleasure to a lot of people for well over a century — and potentially take some other college sports down with it.

Fuck you, Texas. Talk about Tragedy of the Commons.

 

rice4114

June 11th, 2023 at 1:41 PM ^

It was always pay to play/pay to stay. The schools never paid the kids for their NIL in the stadium or on tv. Boosters and fans are paying kids to play for their schools. NIL is a myth with very few exceptions.

The NCAA does appreciate us carrying their water for them and continuing to call this farce NIL.

Im not sure Ive seen so many agree to such a huge lie. Pay the kids rewards from your TV and ticket revenue and tell the NCAA to try to stop us. Go ahead tell a court you are going to block rewards at the athletic seasons end. No employee status just rewards for their participaion in UM athletics aka NIL.

Grampy

June 11th, 2023 at 6:21 AM ^

I like how the new President of the NCAA is wringing his hands and bemoaning his fate.  He knew what he was getting into when he took the job.  What state legislature in football-crazed states isn't going to side with their local schools.  What I don't want to hear is coaches like Jimbo or Sarkisian whining about how paying players has ruined football, a'la Saban.  Hook 'em Horns, indeed!

dragonchild

June 11th, 2023 at 11:40 AM ^

I doubt he's wringing his hands; he's just saying things.  He ain't gonna do shit.

Charlie Baker is the Warde Manuel of state Governors.  He basically built up his reputation as a "moderate" by sitting on any issue that required initiative or principle.  I mean, there's a reason the NCAA hired this guy, and it wasn't to clean house.

Catchafire

June 11th, 2023 at 7:16 AM ^

UM has nil money but paying kids absurd amounts of money doesn't lead to winning, look at tamu.  But, then again, look at Bama, Georgia, and OSU.

This sport is getting more and more horrid.

blueheron

June 11th, 2023 at 7:32 AM ^

Here's my current simple-minded view of all this: If Texas winds up outspending Alabama, Georgia, Clemson, and Ohio State, at least we'll have some variety at the top.

Amazinblu

June 11th, 2023 at 7:49 AM ^

Is the Texas bill going to include guidelines and minimums to spend on activities.  For example -the legislature recommends a school spend at least $250K on a QB prospect’s official visit?

Red is Blue

June 11th, 2023 at 8:22 AM ^

Thought the list of states also doing this was interesting.  Why would Montana expend effort on preventing NCAA NIL investigations?  What programs are the trying to protect?  Perhaps it is simply a "Don't tread on me" type of political stance.

1VaBlue1

June 11th, 2023 at 10:02 AM ^

“It prohibits the NCAA from penalizing Texas schools if they participate in activities allowed under the law.”

So the enforcement mechanism allows any citizen of Texas to sue the NCAA for aiding or abetting NIL based rulings?

Ezekiels Creatures

June 11th, 2023 at 11:47 AM ^

One thing I'm wondering is, can NIL collectives, NIL boosters, etc, contact great players at other colleges offering huge NIL $ to get them to transfer to a Texas school? Maybe that kind of tampering will now be protected in Texas? It's been the wild west in college football since NIL was introduced. This law codifies that wild west. I don't think it's beyond the scope of possibility for that kind of tampering to happen. Of course, it wouldn't be called tampering now.

1VaBlue1

June 11th, 2023 at 11:34 AM ^

Let me get this right...  So Texas schools (UT, TA&M, Baylor, etc) join a national association so they can play sports against other schools from different states under the same set of rules and prizes (NCAA tourneys).  This association makes some rules that every member school accepts (ie: no professional players, athletes must be students, etc) - and these Texas schools also agree to them - so everyone plays under the same rules.

And then Texas decides that its schools' athletes don't have to play under those rules, because they're in Texas.  So the national association - and every other school in it across all the states - is supposed to just accept that.  So now Texas gets to use professional players and non-students against the other member programs non-professionals students.

And you think this is fair?

Ezekiels Creatures

June 11th, 2023 at 12:05 PM ^

detroit_fan,

I'm for States rights, and the Federal government being barred from forcing States to do this or that. But I don't know if this is covered under States rights, because it gives the Texas NIL's a carte blanche of activity in other States, not just in Texas. It is one State being able to do something in every State. I think for that reason the Federal government may have sovereignty in it.

And because NIL affects all of America, these new NIL laws may end up in the Supreme Court. If that does happen, I don't think the Supreme Court can side with the States. I don't like it that the Federal government can reach into State laws. But I don't know if in this case it can be done any other way.

This time it may be good though. Because I personally think NIL has very quickly gotten obscenely out of hand. And States want to make it even more obscene. NIL is still in its infancy. There needs to be an even playing field created. The "NIL Parity Cap" may be the final outcome of this whole process.

rice4114

June 11th, 2023 at 1:30 PM ^

Leave it to government to hard pass on important issues but streamline and approve this shit. Thank god superior coaching is the ultimate trump card. As long as we are getting top 10 classes we will be fine. 

Qmatic

June 11th, 2023 at 1:35 PM ^

Just waiting for this law to be ruled in violation of the broadest most overused statue in American Jurisprudence: The Sherman Antitrust Act.

They will somehow find a way to tie this into interstate commerce