Georgetown Law
Technology Review

In recent months, the National Collegiate Athletics Association (“NCAA”) has taken steps to regulate the disclosure and transparency of data related to “name, image, and likeness” (“NIL”) deals. NIL transparency promises to equip student-athletes with the information they need to optimize their NIL earnings and get fair deals. However, it can also raise privacy concerns related to the public disclosure of sensitive student-athlete information.

In January 2024, the NCAA adopted a new NIL rule related to disclosure and transparency of information related to NIL deals. The rule is slated to take effect in August 2024. According to the NCAA, the new rule is intended to “protect student-athletes by promoting the sharing and centralization of information related to NIL deals such as contract terms and trustworthy service providers.”

The rule requires student-athletes to disclose data to their schools “related to [an] NIL agreement exceeding $600 in value, no later than 30 days after entering or signing the NIL agreement.” Data consisting of contact information, relevant deal terms, and applicable compensation will be “deidentified and provided to the NCAA … at least twice per year.” The NCAA will integrate the data into an aggregated database to enable student-athletes to gain an understanding of the NIL agreement landscape so they can make better-informed decisions.

The NCAA’s new January rule represents a positive step toward greater disclosure and transparency in NIL-related data. However, it remains to be seen whether the rule is adequately enforced or even maintained. The rule would force colleges and third parties to develop comprehensive disclosure protocols and is likely to face legal challenges.

If the rule is invalidated or incapable of being enforced, what would remain is a patchwork of inconsistent NIL-related state laws and court cases that confuse student-athletes and inhibit them from making data-driven NIL decisions. A federal NIL disclosure and transparency law is necessary to empower student-athletes to take advantage of the NIL landscape while protecting their privacy. 

The Origin of NIL Laws

In June 2021, the Supreme Court held in Alston v. NCAA that the NCAA’s compensation rules violated the Sherman Act by restricting education-related benefits for student-athletes. Following this landmark decision for the world of college sports, the NCAA modified its policies to permit student-athletes to be compensated for the value of their NIL. In July 2021, the NCAA released an interim NIL policy that allowed student-athletes to receive NIL-related compensation from third parties for the first time. In October 2022, the NCAA provided additional guidance clarifying approved NIL practices.

The Supreme Court’s Alston decision and subsequent NCAA policy paved the way for boosters and collectives to negotiate NIL deals with student-athletes. A booster, defined by the NCAA as a “[representative] of the institution’s athletic interests,” is anyone who provides money, time, or other benefits to a college’s athletic department or athletes. A collective is a group of boosters that facilitates NIL deals.

Benefits and Concerns of NIL-Related Transparency and Disclosure

A lack of transparency surrounding the existing marketplace for NIL deals can prevent student-athletes from determining their financial value in the NIL market and choosing the deals that are in their best long-term interests. Without access to aggregated NIL market data, it is hard for student-athletes to make sure they are getting a fair deal and not being taken advantage of. Transparency can also protect student-athletes from conflicts of interest that occur when a college has a competing interest with a donor or business.

Insufficient transparency can also enable and widen gender inequalities related to NIL earnings, creating Title IX issues. Colleges need robust disclosure protocols in place to monitor and address inequalities in NIL compensation between male and female student-athletes. Although Title IX likely does not cover NIL because colleges are not parties in NIL deals, U.S. Department of Education (ED) Secretary Miguel Cardona has raised the possibility of adding NIL deals to the information colleges have to disclose to the federal government under Title IX. However, no such rule has been issued by the ED yet.

However, greater NIL transparency can raise privacy concerns related to student-athletes. Disclosure requirements can hinder student-athletes from entering into contracts with entities that include confidentiality provisions. Many colleges are averse to disclosure, pointing to the Family Educational Rights and Privacy Act (“FERPA”), “a federal law that exempts a student’s education record from disclosure to a third party.” State Freedom of Information Act (“FOIA”) laws have also been invoked against public disclosure of NIL deals.

These privacy risks can be mitigated by de-identifying data. Federal student privacy laws like FERPA permit colleges to disclose students’ records if their identifying information is removed or redacted.

What NIL-Specific Laws Are in Place Regulating Disclosure and Transparency?

At least twenty states compel student-athletes to disclose information related to NIL agreements. However, at least six states counsel against disclosure and transparency. Louisiana, for example, has enacted a law rendering NIL contract information “confidential and not subject to inspection, examination, copying or reproduction pursuant to the Public Records Law.” Kentucky passed a law exempting NIL deals from the Kentucky Open Records Act and barring their public disclosure.

In contrast, although Congress has not passed a federal law related to NIL, there are seven pending legislative proposals related to NIL. Of the seven proposals, five of them include transparency provisions that require student-athletes, universities, or third parties to disclose NIL deal data: The Protecting Athletes, Schools, and Sports Act (PASS Act), a bill introduced by Senators Joe Manchin (D-WV) and Tommy Tuberville (R-AL); The Student Athlete Level Playing Field Act (Level Playing Field Act), a bill introduced by U.S. Representatives Mike Carey (R-OH) and Greg Landsman (D-OH); The College Athletes Protection and Compensation Act, a discussion draft released by Senators Richard Blumenthal (D-CT), Jerry Moran (R-KS), and Cory Booker (D-NJ); The Fairness, Accountability, and Integrity in Representation of College Sports Act (FAIR College Sports Act), a discussion draft released by U.S. Representative Gus Bilirakis (R-FL); and a discussion draft released by Senator Ted Cruz (R-TX).

Of these five proposals, three of them—the College Athletes Protection and Compensation Act, the PASS Act, and Sen. Cruz’s draft bill—require a two-step disclosure of data transfer first to the school, and then to an oversight entity. Meanwhile, two of them—the FAIR College Sports Act and the Level Playing Field Act—would require direct disclosure of NIL data to an oversight entity. Three of the proposals—the College Athletes Protection and Compensation Act, the FAIR College Sports Act, Sen. Cruz’s draft bill—would develop publicly accessible databases containing data related to NIL deals. Finally, two of the proposals—College Athletes Protection and Compensation Act, Sen. Cruz’s draft bill—include privacy safeguards accompanying the disclosure and transparency provisions.

Table 1: Federal Proposals to Regulate NIL Data Transparency

Legal Challenges to Transparency Rules and Laws

In February 2024, U.S. District Judge Clifton Corker of the Eastern District of Tennessee blocked the NCAA from enforcing a January 2024 proposed rule that would “prohibit contact between NIL entities and prospects until the prospect signs a letter of intent, participates in summer activities or practices with the team, or enrolls at the school and attends classes.” The preliminary injunction barring enforcement of the rule on antitrust grounds enjoined the NCAA from enforcing any restrictions on NIL compensation until the court arrives at a final decision. Following the Tennessee ruling, the NCAA paused investigations regarding collectives or other third parties entering into NIL deals with student-athletes.

Recommendations

NIL data transparency is necessary to help student-athletes make informed NIL decisions. At the same time, protecting the personally identifiable information (“PII”) of student-athletes is critical. A uniform, federal NIL standard can balance these interests and empower student-athletes to maximize their NIL prospects.

A potential framework for a federal law would require student-athletes, agents, boosters, and collectives to report NIL deal data to colleges. The colleges would deidentify the data using best practice standards and provide it to the NCAA or other independent body, which would aggregate the data into a publicly accessible and searchable database. This framework would better equip student-athletes to enter into fair deals. De-identification would mitigate privacy risks and enable colleges to release NIL information without running afoul of FERPA and other student privacy laws.

To be sure, the NCAA’s January 2024 disclosure and transparency rule is a step in the right direction. If the rule takes effect in August 2024 and is adequately enforced, then the NCAA and policymakers should pay extra attention to implementation of the rule’s de-identification provisions to ensure that best practices are used to safeguard PII of student-athletes.

However, the NCAA has faced several obstacles in court lately, and there is no guarantee that the rule will be enforced, or even maintained. If the rule does not pass muster, the only disclosure and transparency guidelines in place would be the inconsistent patchwork of state laws confusing student-athletes trying to navigate potential deals. The only sustainable solution is for Congress to pass a uniform, federal NIL standard that provides data transparency while protecting student-athlete privacy.

If Congress does not act, another proposed solution is for colleges to oversee NIL transparency. Colleges and their athletic programs could engage directly with agents and boosters to arrange NIL deals, deidentify NIL contract information, and make NIL data publicly accessible. Absent a federal mandate, however, colleges would likely resist transparency, citing FERPA and state laws that prohibit the disclosure of student records. When ESPN requested a sample of 23 colleges to disclose NIL information, and informed schools that federal student privacy laws do not bar the disclosure of de-identified student information, colleges still released “few to no records.” Colleges may reason that disclosing NIL information puts them at a competitive disadvantage relative to their peers, such as with recruiting.

Outside of government and academic institutions, private technology platforms could provide transparency and help student-athletes make data-driven NIL decisions. Digital platforms like Opendorse and INFLCR, which enable student-athletes to map out NIL deals and optimize their earnings, generate aggregate data figures without disclosing personal information. According to ESPN, however, this data is “not independently verified and provides an incomplete picture of the marketplace.”

Conclusion

As the NIL landscape takes shape, student-athletes should be equipped to make data-driven NIL decisions and get fair deals. At the same time, their privacy should be protected. Although the NCAA’s January 2024 disclosure and transparency rule represents a positive step toward greater NIL transparency, there is no guarantee that it will withstand the legal challenges it is likely to face. If the rule is not enforced, then the remaining patchwork of inconsistent NIL state laws and court cases will confuse student-athletes and hinder them from optimizing their NIL earnings. Therefore, a federal NIL disclosure and transparency law, equipped with strong de-identification provisions, is necessary to empower student-athletes to take maximal advantage of the NIL landscape.