The Drake Group Releases Congressional Briefing Paper and Calls for the Establishment of a Presidential Commission to Examine the Conduct of College Athletics

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The Drake Group Releases Congressional Briefing Paper and Calls for the Establishment of a Presidential Commission to Examine the Conduct of College Athletics

On July 11, 2024, David C. Hughes, Ph.D., President of The Drake Group, announced the release of the organization’s preliminary assessment of the proposed settlement of three major antitrust lawsuits against the NCAA and its five most powerful Division I conferences (Power Five conferences). Under the framework and details that have been announced by the NCAA and plaintiffs’ attorneys to date (there has been no release of the actual terms), the NCAA and all Division I conferences will be responsible for paying $2.8 billion in past damages and at least the Power Five conferences will be effectively on the hook for paying up to $10-15 billion in injunctive relief over the next ten years.
 

Hughes stated, “The settlement, without consultation with non-Power Five Division I conferences or Divisions II and III of the NCAA membership would eliminate effectively the current NCAA constitutional prohibition on college athlete ‘pay-for-play.’ The practical effect of the proposed settlement would have 501(c)(3) tax exempt educational institutions operating a Power Five professional sports league while enjoying the tax advantages or their mother ships without their educational obligations — no small step for higher education.” Hughes continued, “We believe the NCAA has not performed its due diligence obligations and ignored proper organizational processes in entering into the announced agreement on the settlement framework. Further, the NCAA and the Power Five conference defendants are bullying non-Power Five conferences to pay almost $1 billion in past damages. Simultaneously, the NCAA is pressuring Congress to provide statutory blessing of the settlement, an antitrust exemption to protect the NCAA and its member institutions from future athlete legal actions, and/or a prohibition of college athletes as employees. College athletes deserve better. It’s time for a Presidential Commission to examine the conduct of college athletics in much the same way as a Presidential Commission reformed our U.S. Olympic sports structure in 1978. The NCAA cannot be trusted with this responsibility.”

Background: On May 23, 2024, the NCAA and the highest-powered athletic conferences —  the Big Ten, SEC, Pac-12, Big 12, and ACC (often referenced as the NCAA Division I Power Five conferences) — jointly announced a proposed settlement to resolve three pending federal antitrust lawsuits: House v. NCAAHubbard v. NCAA, and Carter v. NCAA. Each of these cases, all pending in the Northern District of California, includes both the NCAA and the Power Five conferences as defendants. This Congressional Briefing Paper examines the proposed settlement and implications for college athletics including the application of Title IX to revenue-sharing and NIL payments and employment not tied to educational expenses. Contents include:

  • overview of the settlement framework of the three antitrust cases;
  • impact of the proposed settlement on the NCAA, its competitive divisions, and college athletes, including cost estimates to the Division I conferences, institutions and overall;
  • possible barriers to court approval of the proposed settlement;
  • Title IX implications of the proposed settlement; and
  • issues that should be considered by Congress to protect the education, health, and well-being of college athletes and the educational interests of institutions of higher education.

See Executive Summary