On February 18, 2025, National Labor Relations Board Acting General Counsel William Cowen rescinded a September 2021 memorandum in which former Board General Counsel Jennifer Abruzzo declared college athletes should be considered employees under the National Labor Relations Act. This was one of many memoranda he rescinded that had been issued by his Biden-administration predecessor.

Acting General Counsel Cowen’s withdrawal of the memorandum is the latest in a series of defeats for pro-employee advocates who had hoped to designate collegiate student-athletes as “employees” under the Act.

The first was the December 2024 withdrawal of an unfair labor practice charge filed by the National College Players Association (NCPA) against the NCAA, the Pac-12 Conference, and a private university in the Los Angeles area. The NCPA’s executive director stated the charge had been withdrawn considering the rise of “name, image, and likeness” (NIL) payments to players, as well as the shift in attitude on the subject under the new Trump Administration.

The second blow to proponents of the concept that student-athletes be deemed “employees” was the January 2025 decision by Service Employees International Union (SEIU), Local 560 to withdraw its petition to represent an Ivy League university’s men’s basketball players. In February 2024, a Regional Director for the Board took the historic step of determining that the university’s men’s basketball players should be considered employees under the Act. The case was filed in September 2023 after all 15 members of the men’s basketball team signed a petition to join Local 560 of the SEIU. At the time, the Regional Director determined the university’s level of control over the players was sufficient to qualify the players as employees under Section 2(3) of the Act. The Board found that traditional “team” activities, including the university’s ability to control the players’ academic schedules and the team’s regimented schedules for home and away games, weighed heavily in favor of an employment relationship. With the petition withdrawn for now, the university’s basketball players will remain non-unionized.

Given these developments, the window for student-athletes being deemed employees under the Act appears to be closed for the time being. With the uncertainty surrounding NIL and other issues around collegiate athletics, this area of law will need to be monitored for additional developments. In the interim, private collegiate institutions should be aware that they may face charges or petitions filed with the Board. Such filings must be treated seriously in light of the Regional Director decision discussed above.

Jackson Lewis’ Education and Collegiate Sports Group is available to assist universities, conferences, and other stakeholders in dealing with matters before the Board or otherwise involving the appropriate classification of student-athletes.

Takeaways

  • President Trump signed executive order “Keeping Men out of Women’s Sports,” barring transgender women from competing in women’s sports and citing fairness, safety, and privacy concerns. Schools that do not comply with the new federal policy risk losing federal funding under Title IX enforcement.
  • In response, the NCAA immediately revised its transgender participation policy, restricting competition in women’s sports to athletes assigned female at birth.
  • Legal challenges are expected, as some states and advocacy groups argue the policy is discriminatory and violates previous Title IX interpretations.

Background

On Feb. 5, 2025, President Donald Trump signed executive order “Keeping Men Out of Women’s Sports,” which prohibits transgender women from participating in female athletic categories at federally funded educational institutions. The order also directed the State Department to demand changes within the International Olympic Committee. The Committee has left eligibility rules up to the global federations that govern different sports.

The Trump Administration has made a push to redefine sex-based legal protections under Title IX of the Education Amendments of 1972, emphasizing biological sex as the deciding factor for athletic eligibility. Previously, on Jan. 20, 2025, the Administration issued an executive order declaring the federal government would recognize only two sexes, male and female, for all legal and regulatory purposes.

The NCAA has over 530,000 student-athletes, fewer than 10 of whom are transgender, according to a statement the NCAA’s president, Charlie Baker had provided to a Senate panel in December. In January, Baker called for greater legal clarity on the issue from regulators.

Finding that clarity in the form of the new executive order, in response, the NCAA Board of Governors voted to amend its transgender participation policy the day after Trump’s executive order was issued.

The new policy states that eligibility for NCAA women’s sports is now strictly limited to athletes assigned female at birth. Transgender men (those assigned female at birth but who have begun a medical transition) may still participate in men’s sports without restriction. However, an athlete taking testosterone for gender transition may only practice with a women’s team and is prohibited from competing in official NCAA-sanctioned events. If a team allows an ineligible athlete to compete, the entire team will be disqualified from NCAA championships.

Legal and Institutional Challenges

The executive order immediately ignited controversy as several states and legal groups vowed to challenge the order.

Pushback is expected, particularly in states like California, Connecticut, Massachusetts, and New York, where laws expressly protect transgender rights. Schools in these states now face a dilemma: Whether to comply with federal regulations or uphold state laws that recognize gender identity protections for student-athletes. Schools in these states may risk severe financial consequences if they refuse to comply with the new federal mandate, potentially losing millions in federal education funding.

More than two dozen states already bar transgender athletes from participating in school sports, whether in K-12 schools or at the collegiate level. In January, the House passed a bill barring transgender women and girls from sports programs for female students nationwide (the bill is not likely to pass in the Senate).

What Comes Next?

Some key questions remain:

  • Will federal courts uphold or strike down the new Title IX interpretation?
  • How will schools in certain states navigate the conflict between the executive order and new NCAA policy and state laws?

If an institution or athletic conference requires guidance or assistance in dealing with these evolving and sensitive issues, they should contact the Higher Education & Collegiate Sports practice group at Jackson Lewis.

In a landmark decision, the U.S. Court of Appeals for the Third Circuit rejected the NCAA’s argument that, because student-athletes voluntarily participate in college athletics, they cannot simultaneously be students and employees under the Fair Labor Standards Act (FLSA).

In Johnson v. NCAA, the three-judge panel stymied the NCAA’s effort to reverse the denial of its motion to dismiss, (1) ruling that college athlete’s “amateur status” did not preclude them from bringing an FLSA claim and (2) setting out a new economics-based test for lower courts to apply when determining if college athletes are employees under the FLSA.

This decision creates a circuit split between the Third, Seventh, and Ninth Circuits, foreshadowing potential U.S. Supreme Court involvement.

History Leading Up to Johnson v. NCAA

The NCAA created the term “student-athlete,” to emphasize student-athlete’s status as “amateurs,” differentiating them from both professional athletes and traditional student workers. This argument was supported by the Supreme Court’s decision in NCAA v. Board of Regents of the University of Oklahoma, which upheld the tradition of amateurism in college sports. However, the Supreme Court recently clarified in NCAA v. Alstonthat this statement did not create a binding precedent endorsing the NCAA’s compensation rules.

Other circuits have also examined the economic realities of student-athletes’ relationships with their schools. In Berger v. NCAA, the Seventh Circuit relied on the “revered tradition of amateurism” to conclude that the FLSA did not apply to student-athletes, as their activities were “extracurricular’ and “interscholastic” in nature. Similarly, in Dawson v. NCAA, the Ninth Circuit held that student-athletes were not employees of the NCAA nor the PAC-12 Conference because the NCAA and PAC-12 were more akin to regulatory bodies, not employers.

Third Circuit Decision

Johnson v. NCAA began in 2019 at the U.S. District Court for the Eastern District of Pennsylvania, with current and former athletes from various Division I schools filing a lawsuit for back pay and damages for unjust enrichment due to their rendering of athletic services to their schools at games and practice.

After the NCAA appealed the denial of their motion to dismiss, the Third Circuit was asked to determine the critical question — whether NCAA athletes can be “employees of the colleges and universities they attend for purposes of the Fair Labor Standards Act solely by virtue of their participation in interscholastic athletics.” The NCAA argued that the “revered tradition of amateurism” should shield them from FLSA claims and noted that existing Department of Labor guidelines prohibit student-athletes from being able to be considered employees. Further, the NCAA argued that the “activity of college students participating in interscholastic athletics primarily for their own benefit as part of the educational opportunities provided to the students by the school is not ‘work.’” U.S. Department of Labor Field Operations Handbook § 10b03(e) (2016).  The plaintiffs countered that they are employees of their schools because they satisfy the FLSA’s relevant test for employee status, as their performance in athletic activities indeed constituted “work.” This is largely due to the control that each school has over its athletes’ time and labor, and the separation and distinction between athletes’ athletic participation and their academic work.

In a departure from the district court’s reasoning, the Third Circuit unequivocally rejected the NCAA’s argument that the “frayed tradition” of amateurism shielded them from FLSA claims and determined that student-athletes can be employees under the FLSA. The Third Circuit focused on the economic relationship between the NCAA and student-athletes to determine that they could be employees under the FLSA. The Eastern District Court of Pennsylvania had relied on a test set out by the Second Circuit in Glatt v. Fox Searchlight Pictures, in which the Second Circuit applied a multifactor test to determine whether unpaid interns were employees under the FLSA. However, the Third Circuit held that while unpaid interns and student-athletes share similar considerations, unpaid interns are fundamentally different from college athletes due to their work type. Therefore, Glatt was not the proper test to determine whether college athletes qualify as employees under the FLSA.

The Third Circuit set a new test to determine college athletes’ status under the FLSA. College athletes may be employees under the FLSA if sufficient evidence establishes that the student-athletes:

  1. Perform services for another party;
  2. Necessarily and primarily for the other party’s benefit;
  3. Under their universities control or right of control; and
  4. In return for “express” or “implied” compensation or “in-kind benefits.”

An athlete that fits these criteria “may plainly fall within the meaning of ‘employee’ as defined in [the FLSA].” The Third Circuit directed the lower courts to focus on the cumulative circumstances of the relationship between the athlete and the college or NCAA and whether this relationship “reveal[s] an economic reality that is that of an employee-employer.”

Critically, the Third Circuit held that college athletes cannot be barred as a matter of law from asserting FLSA claims simply by the “revered tradition of amateurism” in college athletics. The Third Circuit criticized the NCAA’s argument as circular, citing Supreme Court Justice Brett Kavanaugh’s concurrence in Alston. “[T]he argument ‘that colleges may decline to pay student athletes because the defining feature of college sports . . . is that the student athletes are not paid,’ is circular, unpersuasive, and increasingly untrue.”

Thus, Johnson returns to Judge John Padova of the Eastern District Court of Pennsylvania to apply the new economic realities test.

Implications for Colleges and Universities

Johnson represents a growing change in the judicial understanding of student-athletes’ relationships with their institutions. Courts are increasingly focusing on the economic relationship between institutions and their students. Johnson will undoubtedly lead to college athletes in popular sports such as football and basketball attaining FLSA employee status.

Further, Johnson creates a circuit split between the Third Circuit and the Ninth and Seventh Circuits, which have already held that student-athletes are not employees under the FLSA.

(Jackson Lewis Summer Associate Luis Moreno contributed to this article.)

The NCAA Board of Governors has voted to approve the terms of a settlement that would resolve several antitrust lawsuits against the NCAA and would require the organization to pay nearly $2.8 billion over a 10-year period to former Division I athletes and institute a revenue-sharing model between certain schools and athletes.  The details of the settlement are still being negotiated.  Once finalized, the agreement must be submitted for court approval.

One of the lawsuits, House v. NCAA, alleges the NCAA and its “Power 5” athletic conferences violated antitrust laws by barring athletes from receiving name, image, and likeness (NIL) compensation prior to 2021 and by prohibiting revenue-sharing from television broadcasting agreements and similar contracts with athletes.

The NCAA faces substantial risks if the House lawsuit proceeds to trial.  U.S. District Court Judge Claudia Wilken, who is presiding over the lawsuit, had ruled against the NCAA in two major NIL-related cases.  Federal antitrust law grants successful plaintiffs treble damages.  The NCAA could be liable for as much as $20 billion in damages (which some say could force the organization into bankruptcy).  A loss at trial could also result the removal of all existing constraints on NIL and revenue sharing in college athletics.  The settlement would permit the NCAA to pay a lesser amount in damages while retaining more ability to regulate athlete compensation.

The nearly $2.8 billion would be in back-pay damages to former athletes who were unable to receive NIL compensation prior to the NCAA’s decision to lift the prohibition in 2021.  Further, the settlement would create an optional revenue-sharing model through which power conference schools may distribute as much as $20 million a year to their student-athletes.

The settlement approved by the NCAA calls for payments to be financed primarily by reductions in annual revenue distributions to the NCAA’s members and from the NCAA’s reserve funds.  The settlement is also expected to involve a reaffirmation of existing NCAA rules regulating student-athlete compensation and the creation of an enforcement infrastructure for those rules. The House settlement would be a groundbreaking moment in college athletics, whose landscape has experienced significant uncertainty surrounding the transition from athletic amateurism into something resembling a professional sports model.  While the NCAA’s $2.8 billion payment has been the focus of many headlines, the House settlement’s most consequential feature may be its revenue-sharing agreement, which would be the first instance of direct profit-sharing between universities and athletes.

The arrival of name, image, and likeness (NIL) agreements has transformed college athletics, offering student-athletes unprecedented opportunities to profit from their personal brands.  Yet, the case of Jaden Rashada, a promising quarterback, is a cautionary tale.

When Rashada entered the 2023 college recruitment season, the NCAA had recently adopted rules allowing compensation to student-athletes for using their NIL.  The NIL era opened the door to forming “collectives” — groups of donors who agreed to fund NIL contracts with athletes in exchange for the athletes’ de facto commitment to a particular university.  The collectives play a huge role in recruitment and facilitating the NIL deals.  NIL hinges on the relationship between a university’s sports program and its alumni, boosters, and these collectives.

 Rashada initially committed to the University of Miami, backed by a substantial $9.5 million NIL deal.  He later changed his commitment to the University of Florida (UF), lured by an even more lucrative promise of $13.85 million.  According to a lawsuit filed by Rashada in the U.S. District Court for the Northern District of Florida, this offer was part of a fraudulent scheme orchestrated by UF head coach Billy Napier, former director of player engagement Marcus Castro-Walker, and booster Hugh Hathcock to induce him to give up his Miami deal.

 According to the complaint, Hathcock offered to pay Rashada $5.35 million, including a $500,000 signing bonus, through Hathcock’s company Velocity Automotive.  The remainder of the $13.85 million would be paid through Hathcock’s NIL collective, Gator Guard.  Rashada alleges in his Complaint that these promises were deceitful and intended to persuade him to abandon Miami and sign a$13.85 million NIL deal with the Gator Collective.  Once he committed to UF, rather than make Rashada rich as promised, the defendants allegedly changed their tune. The amount of UF-affiliated NIL money available decreased significantly when Hathcock decided to sell his business.  Thus, Rashada alleges that the defendants continued to manipulate him until he signed a letter of intent with UF that further deprived him of any other possible NIL opportunities.  Rashada contends that the defendants attempted to strong-arm him into a NIL contract worth a fraction of what they promised after inducing Rashada through false promises to forgo NIL deals from other programs — specifically, the $9.5 million from Miami.

As the complaint notes, “[U]nethical and illegal tactics like this are more and more commonplace in the Wild West that is today’s college football landscape.  As the first scholar-athlete to take a stand against such egregious behavior by adults who should know better, Jaden seeks to hold Defendants accountable for their actions and to expose the unchecked abuse of power that they shamelessly wielded.”

            Rashada’s lawsuit includes serious allegations:

  1. Fraudulent Misrepresentation and Inducement/Aiding and Abetting Fraud: Rashada claims that the defendants knowingly made false promises to lure him to UF. The key elements of this claim involve proving the defendants intentionally deceived Rashada and he relied on these misrepresentations to his detriment.
  • Civil Conspiracy to Commit Fraud: These claims assert the defendants worked together to defraud Rashada. To succeed, Rashada must demonstrate there was a coordinated effort to deceive him and the defendants had a mutual understanding to commit the fraudulent acts.
  • Negligent Misrepresentation: This claim involves the assertion that the defendants made false statements without due care for their truthfulness, leading Rashada to make decisions based on inaccurate information.
  • Tortious Interference/Aiding and Abetting Tortious Interference: Rashada contends that the defendants intentionally interfered with his contractual relationship with Miami, causing him financial harm.

The defendants will likely assert numerous defenses, primarily that there was no enforceable contract, as NIL agreements often lack formal documentation and unambiguous terms. This potential defense hinges on the nuances of contract law, particularly the requirement for mutual assent and consideration.  However, in the state of Florida, oral contracts are enforceable.

The involvement of Rashada’s agents in the negotiations could also be used to argue that Rashada was adequately represented and not misled or exploited.  The complaint portrays Rashada as an individual taken advantage of by a head coach and a collective.  However, there is an argument that sophisticated agents and attorneys represented and adequately advised him before he chose UF.

Rashada’s lawsuit highlights the broader legal and regulatory challenges in the NIL landscape.  A lack of uniform regulations and enforcement mechanisms hinders the current environment.  There is a legitimate need for more precise guidelines for NIL agreements to protect student-athletes.  As this case progresses, it has the potential to set essential precedents and potentially drive legislative and regulatory changes to ensure the integrity of NIL practices.

Please contact a Jackson Lewis attorney with any questions.

As restrictions lessen on collegiate athletes’ ability to be compensated for their name, image, and likeness (NIL), international student-athletes in F-1 status continue to be at risk if they pursue these economic opportunities. On April 29, 2024, a bipartisan group of U.S. senators penned a letter to Department of Homeland Security (DHS) Secretary Alejandro Mayorkas to push the agency to bring international athletes into the fold.

According to Senators Richard Blumenthal (D-Conn.), Christopher Murphy (D-Conn.), Pete Ricketts (R-Neb.), and Shelley Moore Capito (R-W. Va.), DHS can provide a simple solution:

While many students have rightfully benefitted from these new [NIL] opportunities, international college athletes and college athletic programs face a credible risk that even the most basic NIL deal could violate the work restrictions of the F-1 visa. DHS could clarify that the F-1 visa program does not prevent a student from engaging in NIL related activities ….

As Jackson Lewis’ Immigration Practice Group previously discussed, NIL deals likely do not qualify as on-campus employment authorized for most foreign students in F-1 visa status. Alternatives to F-1 visas for international student-athletes are difficult to obtain. As a result, while their American teammates cash in, international student-athletes cannot market themselves without risking being removed from competition and the country.

According to the senators, Secretary Mayorkas promised swift action to provide clarity to tens of thousands of international student-athletes during Senate oversight hearings over a year ago; but DHS has failed to deliver. With another academic year coming to a close, the senators seek to spur DHS to act as promised. Should DHS update its regulations, international student-athletes may be able to economically “benefit from the blood, sweat, and tears they put into their sport” come the fall. Jackson Lewis’ Sports Industry Group and Immigration Practice Group will continue to monitor NIL developments and the potential impact on college sports and international student-athletes. Please reach out to members of either Group with questions.

Tennessee Senator Marsha Blackburn (R) and New Jersey Senator Cory Booker (D) have reintroduced the “NCAA Accountability Act.”  This follows multiple hearings held over the past few years on NCAA operations, including how the NCAA handles investigations and enforcement of its bylaws.

The bipartisan bill seeks to enhance due process protections for intercollegiate athletic programs under investigation for potential rule violations by the NCAA. Under the proposed legislation, investigations by the NCAA Enforcement staff would involve greater transparency, expediency, and consistency. Because of the increase of name, image, and likeness (NIL) arrangements and their use as a recruiting tool, combined with several states passing their own NIL-related legislation, there are many questions and concerns about the NCAA’s parameters and protocols for conducting investigations and how penalties are imposed by the NCAA Infractions Committee, especially in the context of NIL-related recruiting violations.

NCAA Accountability Act: Key Proposals

The bill calls for the NCAA to expedite investigations in a consistent manner:

  • Under the bill, the NCAA must complete the investigation within a one-year period after providing notice to the institution of an alleged infraction.
  • The bill imposes a limitation period, barring the NCAA from investigating alleged violations that may have occurred beyond two years from the date notice was sent to the school.

Arbitration as a potential remedy for dispute resolution:

  • If there is a dispute over the NCAA’s recommendation for punishment, the member universities may compel arbitration.
  • Arbitration must be conducted by a three-person panel. The arbitrators will provide an independent review and binding decision.

The Attorney General can ask NCAA for reports about investigations:

  • The Attorney General can direct the NCAA to submit an annual report to the Department of Justice summarizing its enforcement proceedings.  The NCAA must also submit separate reports to each state’s attorney general summarizing its interactions with member universities headquartered in their respective states.
  • The bill provides the Department of Justice reasonable access to examine evidence of any person or covered athletic association being investigated.

While it is unlikely to pass in an election year, ultimately, the bill seeks to generate increased fairness, uniformity, and transparency in the NCAA’s process for investigating and litigating potential rule violations.

Jackson Lewis’ Collegiate Sports Industry Group is available to assist universities, conferences, or other stakeholders in dealing with infractions investigations, hearings, appeals, and other matters involving alleged violations of NCAA bylaws.

The U.S. Department of Justice, alongside the District of Columbia and states of Mississippi, Virginia, Minnesota, joined seven other states in their antitrust challenge against the NCAA’s transfer eligibility rule.

The rule blocks some student-athletes from immediately competing after transferring between colleges and has been a recent source of contention in the world of college athletics.

In December, a federal district court held the rule likely violated the Sherman Antitrust Act and temporarily suspended its enforcement for 14 days.  Soon after, the NCAA agreed to suspend enforcement of the rule through the end of the 2023-24 season, ensuring that all winter and spring transfer athletes are eligible to complete while the suit is pending.

The NCAA argues that the ending the rule would upend the amateur nature of college athletics, replacing it with “a system of perpetual and unchecked free agency.”  The plaintiff states argue the rule illegally restrains college athletes’ ability to engage in the labor market, monetize their image and likeness, and control their education.

The lawsuit is now backed by the federal government, the nation’s capital, and the attorneys general of 10 individual states.  This diverse coalition, representing a variety of geographical regions and political leanings, appears to signal a formidable alignment against the NCAA’s transfer eligibility rule.

Please contact the attorneys in the Jackson Lewis Sports industry group with any questions.

NCAA President Charlie Baker penned a letter to student-athletes, asking for feedback on his proposal to allow Division I (D-I) schools to pay student-athletes directly.

In the December 19 letter, Baker emphasized that schools and student-athletes need to partner with Congress in seeking a federal law with an antitrust exemption preventing college athletes from being considered employees of the schools they attend.  He encouraged student-athletes to join the conversation, stressing the importance of their voices in shaping the future of college sports.

Earlier this month, Baker proposed a new system, a significant departure from the current NCAA structure.  The novel proposal centered around allowing D-I schools to directly compensate athletes through an enhanced educational trust fund and creating a new D-I football subdivision for schools that choose to participate.  The proposed educational trust fund would pay at least $30,000 annually to half of the institution’s eligible student-athletes.  The proposal intends to enable D-I schools to provide financial support directly to athletes, addressing concerns related to name, image, and likeness (NIL) opportunities and NIL collectives.  Under the plan, Baker envisions an in-house revenue-sharing mechanism to handle NIL, reducing the role of third-party collectives. 

With the NCAA facing potentially existential threats from ongoing litigation, Baker’s proposal aims to balance liberating major conference programs with avoiding a complete breakaway from the existing NCAA structure.  In the letter, Baker notes that the proposed changes will enhance opportunities for all D-I student-athletes and promote gender equity, as schools must adhere to existing regulations in their athletic program investments.  He emphasized the importance of flexibility for colleges and universities and for the NCAA to adapt to the evolving landscape of college sports. 

However, while Baker argues that this plan enhances financial opportunities for all D-I student-athletes, critics raise questions about the impact on Title IX compliance, the potential reduction of Olympic sports, the widening gap between major conferences and others, and the potential consequences for student-athletes in non-revenue sports.  Baker acknowledges that the proposed model challenges traditional notions of amateurism, aiming to offer student-athletes a fair share of the financial benefits associated with their skills and institutional value.  He encourages a shift toward more flexible rules and frameworks across the NCAA that prioritize student-athletes’ well-being.

The letter also discusses the NCAA’s ongoing “endless legal challenges,” acknowledging lawsuits like Johnson v. NCAA and In Re College Athlete NIL Litigation, which collectively demand significant compensation for college athletes.  Undoubtedly, Baker recognizes the significance of litigation over athlete compensation.

Baker’s letter serves as a call to action, urging student-athletes to engage in the conversation and partner with the NCAA in directing the future of college sports.  It signals a significant shift in the NCAA’s approach to compensation and regulation, aiming to find a middle ground between the interests of major conferences and the overall stability D-I sports.  The future of college athletics hangs in the balance, with potential consequences for student-athletes, universities, and the structure of the NCAA itself.

The Jackson Lewis Sports Industry group represents colleges and universities involved in NCAA infractions investigations, waiver requests, NIL issues, and other matters.

A federal court ruling has forced the NCAA to suspend its transfer eligibility rule, bringing temporary relief to college athletes seeking to transfer schools without sitting out a year of competition.

The rule, which requires certain Division I athletes who transfer schools to defer a year of competitive eligibility, was challenged in a federal lawsuit filed by several U.S. states. The states allege the rule violates Section 1 of the Sherman Antitrust Act and harms student-athletes in the market for their athletic services.

On Dec. 13, 2023, U.S. District Judge John Preston Bailey issued a temporary restraining order (TRO), preventing the NCAA from enforcing the transfer eligibility rule until a hearing scheduled for Dec. 27. The hearing will determine whether Judge Bailey issues a preliminary injunction, which could suspend enforcement of the rule until the lawsuit is resolved.

The Ruling Explained

In granting the TRO, Judge Bailey found the seven states were likely to prove that the transfer eligibility rule violates the Sherman Act.

Judge Bailey wrote that the rule brings three primary harms to college athletes. First, the rule imposes a one-year ineligibility penalty that may discourage student-athletes from transferring even when another school better suits their academic, mental, or economic well-being.

Second, transferring student-athletes face a competitive disadvantage because many schools may hesitate to offer scholarships to athletes who will not be eligible immediately.

Third, the rule hinders student-athletes’ economic opportunities by limiting their ability to secure name, image, and likeness (NIL) endorsement deals and restricting their exposure to professional sports leagues.

Judge Bailey also noted that the inability to play their respective sports negatively affects athletes’ mental health.

Judge Bailey cited the examples of Southern Illinois University football transfer Noah Fenske and West Virginia University basketball transfer RaeQuan Battle, both of whom missed all or portions of their respective seasons. He wrote that the rule impeded Fenske’s and Battle’s ability to pursue NIL money, harmed their professional prospects, and may have detrimentally affected their mental health.

Impact of the Ruling

Following the ruling, the NCAA announced it would comply with the court’s decision by suspending enforcement of the transfer eligibility rule. Consequently, athletes previously affected by the rule are immediately eligible to return to competition, at least until the Dec. 27 hearing.

This decision is a significant, yet controversial, development in the world of collegiate athletics. While some feel that permanent elimination of the transfer eligibility rule would be progress for the rights and opportunities of college athletes, others fear its demise will lead to unrestricted free agency and signal the end of amateurism in college sports.

Please contact the Jackson Lewis Collegiate & Professional Sports industry group with any questions.