House settlement nears final approval: Takeaways from latest hearing

Despite withholding her approval, Wilken indicated that she'd approve the multi-billion dollar settlement if changes were made regarding roster limitations and the inclusion of future athletes in the class. Here are the key takeaways from Monday's hearing.

Inclusion of future athletes is judge's foremost issue

One of the major components of the House settlement is the $2.77 billion damage pay that will be distributed over the next decade to student-athletes who played from 2016-2024. Another major piece is the revenue sharing concept that would permit schools to spend $20.5 million per year on their student-athletes in a cap system that would escalate over time.

Wilken's biggest issue with the settlement was more related to the second component; specifically, the fact that the settlement incorporates future student-athletes who are not currently in college. She mentioned a “10-year-old playing kickball” as an example of someone who will be impacted by the settlement, but currently has no say in the matter.

NCAA attorney Rakesh Kilaru argued that the 10-year arrangement was essentially for "stability" and that there wouldn't be a deal without it. Wilken suggested cleaning up some language surrounding future athletes and their association with the settlement.

Roster limitations phase-in

As part of the settlement, the NCAA and its power conferences agreed to expand scholarship limits while making it so that schools are permitted — not required — to scholarship every player on a roster. At the same time, they imposed roster limits on some sports that previously didn't have any. As a result, thousands of student-athletes at the Division-I level are projected to get cut — and in some cases, some schools have already begun the process.

Wilken suggested the idea of phasing in roster limitations to alleviate some of the stress student-athletes face heading into the 2025-26 athletic season. She thought roster limitations could lead to an antitrust violation as it relates to current student-athletes, as opposed to future student-athletes who would know the rules.

Collective bargaining 'may be a good idea'

There's no mention of a collective bargaining agreement anywhere in the settlement, as Wilken pointed out early on in the hearing — while at the same time suggesting that "it may be a good idea."

As Wilken made clear during her "10-year-old playing kickball" analogy, the settlement is striving to place a financial cap on people who don't even have a say in the final agreement. If approved, any player could file another antitrust lawsuit since their compensation wasn't collectively bargained for. A collective bargaining agreement would shield the NCAA from further litigation because, in that case, the parties would have agreed on working conditions, health and welfare, salary, etc.

Recent legal efforts to unionize student-athletes fell flat in January, when a players' advocacy group that filed charges against the NCAA, Pac-12 and USC that would have potentially opened the door for college players to form a union decided to withdraw its complaint. Around the same time, an administrative law judge closed a similar case that was filed by men's basketball players at Dartmouth.

Steven Molo of MoloLamkin LLP, the law firm that helped student-athletes file their objections, brought up during the hearing that revenue sharing had not been collectively bargained. Wilken responded that while it may be a better idea, it wasn't part of the suit.

Hold your objections

There were 14 objectors who spoke during the hearing, though Wilken wasn't really interested in anything that didn't have to do with roster limitations, third-party NIL regulations or future athletes involved in the settlement.

Molo argued that roster limits in a free market aren't fair and that schools should be allowed to have as many players on a team as they want. After Molo said he doesn't want roster or scholarship limits, Wilken went into her idea of "grandfathering" roster limitations.

Heading into the hearing, Wilken didn't acknowledge that the settlement was a Title IX issue, and as such, she didn't listen to many objections regarding the matter. That includes the remarks from Dunne, who claimed her back-pay projection was much lower than her actual NIL earnings and objected to the back-pay distribution methods that she said were calculated using "old logic."

According to the formula used to distribute backpay — determined by an athlete’s media value, school and conference — as much as 85% will be distributed to football and men’s basketball players.

Multiple objectors brought up a draft of a bill by Sen. Ted Cruz, R-Texas, that aims to help the NCAA regulate the NIL market for college athletes without running into more antitrust restrictions. Plaintiff counsel Steve Berman said he believes the NCAA will go to Congress to ask for immunity from antitrust litigation if the settlement isn't approved.

What’s next?

Attorneys have one week to respond to some of the recommendations Wilken made regarding future athletes being bound to the settlement and phasing-in roster limitations. According to Ross Dellenger, Berman hopes that the settlement is approved within three weeks after the changes are made.

If approved, the foundation of the amateurism model in college sports will be uprooted, as schools share revenue with student-athletes while taking away opportunities from student-athletes in non-revenue-generating sports. Whether or not it sparks more antitrust lawsuits from student athletes remains to be seen.

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