The Wild West of name, image, and likeness: Department of Education says athletic departments may be planning to violate Title IX

Part 6 in the series “The Wild West of name, image, and likeness.”

The NCAA and its power conferences recently agreed in principle to allow each school to share up to $20.5 million in direct payments to its athletes via name, image and likeness deals as one of the terms of a pending antitrust settlement.

Many schools from those power conferences have developed comprehensive plans to distribute the majority of that money to athletes in sports that generate the most revenue: namely, men’s football and men’s basketball.  In certain cases, school athletic directors have publicly stated intentions to provide upwards of 75% of the money to men’s football players.

However, last week, the U.S. Department of Education, Office for Civil Rights (the Department) published a “fact-sheet” memorandum which throws a wrench into those plans. 

The Department’s memo, titled “Ensuring Equal Opportunity Based on Sex in School Athletic Programs in the Context of Name, Image, and Likeness (NIL) Activities,” ultimately concludes that the plans of many major college athletic departments for how they will distribute new direct payments to their athletes would violate Title IX law. Passed in 1972, Title IX is a federal law that prohibits sex-based discrimination in education programs. The law requires that schools pay out financial assistance in proportion to the number of students of each gender who play sports on campus. It also calls for schools to provide opportunities to play varsity sports in proportion to the gender distribution on campus. If 50% of a school's athletes are women, then 50% of the school's financial aid for athletes must be allotted to women.

According to the Department’s memo, "[w]hen a school provides athletic financial assistance in forms other than scholarships or grants, including compensation for the use of a student-athlete's NIL, such assistance also must be made proportionately available to male and female athletes." The memo further states that male and female athletes also deserve equivalent publicity, including in sports information personnel, the amount and quality of promotion, and even in social media postings.  According to the Department, if a school fails to provide equitable publicity, those students risk losing out on NIL opportunities. 

Notably, the memo fails to provide clarity as to how payments from third party collectives are impacted by Title IX law.  While the memo states that the Department does not consider money provided by a third party in an NIL deal as athletic financial assistance – like the future revenue sharing payments or scholarship dollars, it also states that if money from private sources ends up creating a disparity in an athletic program, it is possible that NIL agreements could "trigger a school's Title IX obligations." There are currently multiple pending Title IX lawsuits related to NIL compensation from third parties, which will have a significant impact on the legal landscape moving forward.  

Interestingly, the Department’s memo was published during the final days of the current administration's time in power and may provide fodder for both current and future lawsuits.  It remains to be seen if the Department will interpret Title IX law the same way when President Trump's administration installs new officials.

McDonald Hopkins will continue to provide updates on this topic as it unfolds.