Law Uncategorized

College athletes paid $40 million in historic settlement, more may be on horizon

This week, the $40 million settlement between Electronic Arts and collegiate athletes was completed. Does a bigger payout await?

Photo Credit: EA Sports
Photo Credit: EA Sports

The $40 million settlement between college football/basketball players and videogame maker Electronic Arts (EA) has been completed this week, marking the first time collegiate athletes will be paid for the commercial use of their images.

Pieces of the $40 million settlement could go to more than 100,000 athletes, with each athlete getting anywhere from $48 to $951 dependent upon how many athletes file claims.

Players aren’t the only ones getting paid: attorneys fees represent 33 percent of the settlement — or $13.2 million — as well as $1.2 million reimbursement in legal expenses.

END OF EA COLLEGE FOOTBALL

EA announced last September that it would shutter the NCAA Football video game franchise, ending its 20-year run when the videogame maker first released Bill Walsh College Football in 1993.

The antitrust case accused EA of colluding with the Collegiate Licensing Company to fix the amount paid to college athletes for their publicity rights at zero.

According to the suit, the alleged participants were the NCAA and its member schools who had purportedly agreed not to compete with one another for student-athletes when it came to licensing revenues.

(AP Photo/Isaac Brekken)
(AP Photo/Isaac Brekken)

BIGGER CASE AROUND THE CORNER

If the EA Sports settlement was an appetizer, the O’Bannon vs. NCAA suit is unquestionably the main course in this ongoing saga.

On Monday, June 9th, the O’Bannon vs NCAA trial will begin trial in the larger, watershed case for collegiate athletics that challenges the NCAA for a piece of an even greater pie: television revenues.

Unlike EA, the NCAA has vowed to fight endlessly and take the O’Bannon case “all the way to the Supreme Court.”

When the sparks fly in the courthouse next week, the NCAA will likely point out that EA’s settlement is a non-admission of guilt whereas athletes will herald it as the first move towards paying collegiate athletes for their images and likenesses.

Either way, the table is set for a monumental showdown that could undeniably change how the business of college sports operates. Rather than take the field, EA chose to watch this one from sidelines and avoid dragging themselves through the legal mud that inevitably awaits.

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