Allegheny County Bar Association

I. University of Pittsburgh’s Handing of NIL Change

The University of Pittsburgh (Pitt) has taken a progressive stance on its Name, Image, and Likeness (NIL) policy; choosing to assist its student-athletes rather than hinder them in pursuit of these newfound opportunities. The recent change in the NCAA’s stance on student-athlete compensation has given the players the opportunity for personal financial gain and the ability to partner with charities.

“As it relates to providing our student-athletes with the most extraordinary experience at Pitt, our goal is to be progressive, innovative and helpful in every aspect of their student-athlete experience and the world of name, image and likeness is no different…We look forward to helping our student-athletes learn more about this topic and build a transparent relationship with them and their families so we can assist in their efforts or aspirations to maximize compensation and opportunities involving their name, image and likeness,1” said Heather Lyke, Pitt’s Athletic Director.

One of Pitt boosters’ first major foray into NIL came in the form of a traditional NIL collective, Alliance 412. Per NCAA guidance, Alliance 412 seeks to support all Pitt athletics without a formal relationship with the University itself. Instead, the collective hopes to connect Pitt student-athletes with businesses and strategic partners while maintaining transparency and compliance.2

On Aug. 10, 2021, the Steel City NIL Club began operation through a partnership with YOKE. This organization offers a unique approach for members of Pitt’s football team to engage in a variety of NIL opportunities. In contrast to Alliance 412, which engages in more traditional NIL deals, the Steel City NIL Club is a more direct revenue stream for the players. The YOKE platform creates a paywalled community granting paying members special access to the participating players in the form of Q and A’s, and exclusive player created content.3 The profits from these memberships are then split evenly among the participating players. This newer NIL vehicle created by YOKE has been adopted by players on over 20 college football teams including LSU, Tennessee, Ole Miss, and UNC.

The loosening of NIL restrictions has more benefits than just getting individual student-athletes paid. Prior to the Backyard Brawl, the Country Roads Trust which is West Virginia University’s NIL collective, and Alliance 412 partnered with the Ronald McDonald House charity in both Pittsburgh and Morgantown. Athletes from both teams served lunch at the facilities which help house patients and their families who have travelled for medical treatment. The players entered into a lighthearted competition to see which program could raise the most money for the charity prior to the much-anticipated rivalry game.

II. Background and Uncertainty with NCAA NIL Guidance

Following the NCAA’s June 2021 adoption of its interim NIL Policy, college student-athletes are now permitted by the collegiate athletics’ governing body to engage in commercial and promotional activity using their own name and image for profit. This meteoric shift in college athletics, which coincided with the Supreme Court’s decision in NCAA v. Alston4, has resulted in one of the most chaotic and uncertain years in collegiate sports. The Alston decision, which held the NCAA’s policy on educational compensation for student-athletes was a violation of anti-trust law under the Sherman Act, coupled with California’s Fair Pay to Play Act of 2019 spurred the NCAA into action. In Justice Kavanaugh’s concurrence he explained,

“Traditions alone cannot justify the NCAA’s decision to build a massive money-raising enterprise on the backs of student athletes who are not fairly compensated. Nowhere else in America can businesses get away with agreeing not to pay their workers a fair market rate on the theory that their product is defined by not paying their workers a fair market rate. And under ordinary principles of antitrust law, it is not evident why college sports should be any different. The NCAA is not above the law.”

This opinion, bolstered by California’s Fair Pay to Play Act, enacted in 2019 and originally set to go into effect in 2023, which made it illegal for the state’s public institutions to limit a student-athlete’s ability to profit from their own image forced the NCAA’s hand in ending its stance on amateurism.

A mixed bag of state laws and the lack of true enforcement of the new guidance has left the NIL landscape on uncertain ground with certain boosters testing the limits of how and what for a student-athlete may be compensated. However, the NCAA’s messaging on a few restricted areas is fairly clear: no recruiting inducement, no pay-for-play, no payment by the institutions themselves, and no payment for specific athletic achievements.5

On June 25, 2021, Pennsylvania enacted its own NIL law permitting student-athletes to be compensated for their image. This law allows a college student-athlete to earn compensation for their name, image or likeness that is “commensurate with the market value” of the student-athlete’s name, image or likeness. In addition to forbidding compensation for attending, participating, or performing at a particular institution of higher learning, the law also prohibits affiliation with adult entertainment products, alcohol products, gambling, tobacco and electronic smoking products, prescription pharmaceuticals, and controlled dangerous substances.6

One of the primary concerns voiced by detractors of NIL opportunities for student-athletes is the difficulty in overseeing and regulating booster-backed collectives that could potentially be utilized to conduct unsanctioned pay-for-play or inducement. With the lack of any real oversight or enforcement at the moment, this structure is ripe for abuse. This spurred further NCAA guidance re-emphasizing that boosters and booster lead collectives are not permitted to participate in the student-athlete recruiting process.

One early target of the NCAA appeared to be Miami University booster John Ruiz. In June 2022, Mr. Ruiz was asked by Miami’s compliance department to meet with officials from the NCAA. An experienced litigator himself, Mr. Ruiz gained some notoriety for his NIL deals with upwards of 100 student-athletes at Miami, including a two-year deal for Kansas State basketball transfer Nijel Pack totaling $800,000.7 No adverse action has been taken against Mr. Ruiz or Miami following the meeting with the NCAA.

The NIL policy is still in its infancy and the NCAA has yet to fully launch into its enforcement efforts. Public pressure is mounting to maintain fairness and prevent under the table dealing which had plagued NCAA programs prior to the interim NIL guidelines being established. As the law develops nationally and locally, we will provide additional updates.

1 https://pittsburghpanthers.com/news/2021/ 6/30/general-pitt-athletics-introduces-forged-here-a-comprehensive-collaboration-to-enhance-nil- opportunities.aspx
2 https://pittsburghsportsnow.com/2022/04/ 12/alliance-412s-goal-to-provide-pitt-student- athletes-nil-opportunities/
3 https://pittsburgh.rivals.com/news/pitt-players- find-unique-opportunity-in-new-nil-club
4 NCAA v. Alston, 141 S. Ct. 2141 (2021). https://www.supremecourt.gov/opinions/20pdf/ 20-512_gfbh.pdf
5 https://ncaaorg.s3.amazonaws.com/ncaa/NIL/ NIL_QandA.pdf
6 https://www.legis.state.pa.us/CFDOCS/Legis/ PN/Public/btCheck.cfm?txtType=PDF&sessYr=2021&sessInd=0&billBody=S&billTyp=B&billNbr=0381&pn=0972
7 https://www.cbssports.com/college-football/ news/ncaa-meets-with-miami-booster-john-ruiz-as-it-begins-combing-through-nil-landscape-in-college-sports/

“Reprinted with permission from the Allegheny County Bar Association”