Last week on July 1, 2021, a seismic shake occurred in the college sports world. At midnight, Miami Hurricanes quarterback D’Eriq King signed the first student-athlete endorsement deal with College Hunks Hauling Junk and Moving, a franchise company that has been featured on SharkTank. King reportedly will receive $20,000 in compensation for the deal. Hurricanes’ safety Bubba Bolden reportedly received the same deal. Prior to July 1, and for the entire existence of collegiate amateur sports, college athletes have not had the opportunity to benefit off their name, image, and likeness (NIL).

As recently as 2017, the NCAA ruled University of Central Florida kicker, Donald De La Haye, ineligible to participate on the football team, cutting his football career short because he was monetizing his own YouTube videos.

Over the past several years, many States introduced and signed bills into law that afforded student-athletes the same rights as any other college student on campus: the right to benefit off one’s own name, image, and likeness.

California introduced the Fair Pay to Play Act, which was signed into law in September 2019 but would not take effect until January 1, 2023. Other States followed suit, including Florida, which introduced Senate Bill 646: Intercollegiate Athlete Compensation and Rights. SB 646 was signed into law in June 2020 and had an effective date of July 1, 2021, the earliest any NIL law would take effect. This ambitious deadline spurred other states to implement their own NIL laws and include the same July 1, 2021 effective date. Florida, Alabama, Georgia, Mississippi, New Mexico, Texas, Illinois, Oregon, Colorado (moved up from 1/1/2023), Kentucky (by executive order), and Ohio (by executive order) were the 11 states with effective July 1, 2021 dates.

The Supreme Court’s decision in the NCAA v. Alston essentially reshaped the relationship between universities and the athletes who play college sports. In an opinion by Justice Gorsuch, the Supreme Court justices ruled 9-0 that the NCAA cannot prohibit its member schools from providing athletes with certain forms of education-related benefits, such as paid post-graduate internships, scholarships for graduate school, or free laptops or musical instruments.  Justice Brett Kavanaugh wrote that the NCAA’s policies banning compensation through endorsements “raise serious questions under the antitrust laws.” The decision paved the way for college athletes to be able to earn money for endorsements using their name, image and likeness.

The NCAA waited until the midnight hour on June 30 to release its interim NIL policy concerning over 500,000 student-athletes across the nation. In essence, the NCAA has stated that if you are a college athlete in a state with an effective NIL law, follow that law; and for college athletes in states that do not have a law, those college athletes may still participate and engage in NIL activities, with the NCAA giving little to no guidance or any restrictions and deferring to the school’s athletic departments.

Until a federal law is passed and goes into effect, college athletes in the State of Florida must adhere to SB 646’s guidelines. Some of the main takeaways from Florida’s NIL law that Florida college athletes should be aware of are as follows:

• An athlete agent representing an intercollegiate athlete for purposes of securing compensation for the use of her or his name, image, or likeness must be licensed under part IX of chapter 468 in the State of Florida.
• An attorney representing an intercollegiate athlete for purposes of securing compensation for the use of her or his name, image, or likeness must be a member in good standing of The Florida Bar.
• The duration of a contract for representation [ex. a marketing representation agreement] of an intercollegiate athlete may not extend beyond her or his participation in an athletic program at a postsecondary educational institution.
• The duration of a contract for compensation for the use of an intercollegiate athlete’s name, image, or likeness may not extend beyond her or his participation in an athletic program at a postsecondary education institution.
• An intercollegiate athlete may not enter into a contract for compensation for the use of her or his name, image, or likeness if a term of the contract conflicts with a term of the intercollegiate athlete’s team contract.
• An intercollegiate athlete who enters into a contract for compensation for the use of her or his name, image, or likeness shall disclose the contract to the postsecondary educational institution at which she or he is enrolled, in a manner designated by the institution.

In addition, college athletic departments may restrict and implement their own policies such as banning endorsements with certain types of companies such as gambling, alcohol, and tobacco.

Furthermore, college athletes should be aware of the universities’ policies regarding the universities’ trademarks and logos. In addition, college athletes cannot use content created by the school’s creative departments and the creative departments cannot assist the college athletes with the facilitation and creation of endorsement materials as it is a conflict of interest.

Therefore, college athletes must hire outside content creators and freelancers and potentially license any content from the University or appropriate media company or network if the college athlete wants to use content with university marks and logos that is going to be repurposed for commercial purposes.

Franchise companies are eager to take advantage of this opportunity to market their brand through college athletes. The opportunity to market through college athletes could be budget friendly and reach an entirely new market of young people. For example, Spencer Rattler, quarterback for the University of Oklahoma and Netflix QB1 star, signed a deal to represent Raising Canes on an NIL deal.

Our attorneys have advised franchise companies on how to approach NIL deals and appropriately paper them up. It is no surprise that the first ever NIL deal was a franchise deal as athletes have been investing in franchising for decades with a recent increase in major deals involving high-profile athletes.

Whether you are a college athlete looking for representation before you sign an NIL deal or a company looking to partner with college athletes, we are here to help you navigate and comply with all NIL laws. If you have any questions on NIL, please contact us at (561) 693-3234 or email awasch@waschraines.com and one of our attorneys will be available to speak with you and guide you through the process.

About Wasch Raines LLP

Wasch Raines LLP is a franchise and business law firm providing a comprehensive range of services to emerging and established businesses and franchise companies in a variety of industries. Through its unique business model, the firm offers its clients the benefits of having a cost-efficient in-house general counsel and a full service litigation team.

 This blog post has been authored by Wasch Raines LLP law clerk Joshua Goldberg (FIU Law ’22). Josh is working with the firm’s attorneys in our franchise, sports law/NIL, corporate and trademark practice groups.

Wasch Raines LLP has has provided this article for general informational purposes only. It is not intended as professional counsel and should not be used as such. You should contact your attorney to obtain advice with respect to any particular issue or problem.