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• US$2.8bn settlement resolves three antitrust cases against governing college sports body
• Division I athletes from 2016 onwards to be financially compensated by NCAA and power conferences
• Power conferences form regulatory body to oversee payments

The National Collegiate Athletic Association’s (NCAA) US$2.8 billion settlement for three antitrust lawsuits has received final approval from a federal judge, paving the way for member schools to directly pay student athletes.

First announced last year, the settlement resolves three cases that claimed the governing college sports body illegally restricted college athletes from earning money through name, image and likeness (NIL) endorsements.

The settlement will also establish a new revenue-sharing model in college sports, with schools able to pay their athletes roughly US$20.5 million in NIL revenue over the 2025/26 campaign. The annual cap is expected to rise annually over ten years and will take effect beginning on 1st July.

The NCAA, alongside its five power conferences, will also pay nearly US$2.8 billion in damages to Division I athletes who competed in college from 2016 onwards. The payments will be made over ten years.

Final approval was granted by Judge Claudia Wilken after changes were made with regards to roster limits, satisfying objections made to the settlement.

“This result is a fantastic win for hundreds of thousands of college athletes,” said Steve Berman, one of the lead attorneys for the plaintiffs. “We look forward to overseeing this process and watching the revenue-sharing benefits unfold for college athletes over the next 10 years.”

“Approving the agreement reached by the NCAA, the defendant conferences and student-athletes in the settlement opens a pathway to begin stabilising college sports,” wrote Charlie Baker, NCAA president, in a public letter. “This new framework that enables schools to provide direct financial benefits to student-athletes and establishes clear and specific rules to regulate third-party NIL agreements marks a huge step forward for college sports.“

The settlement is the culmination of a multi-year process. 

In June 2021, the US Supreme Court unanimously ruled against the NCAA in a case, stipulating that the governing college sports body could not stop schools from paying athletes in education-related benefits. The comprehensive defeat left the organisation vulnerable to fresh legal challenges to its rules limiting compensation.

Since then, student-athletes have been able to earn money from third parties and companies through NIL deals. There has also been an increase in the involvement of boosters, which are payments made by collectives using NIL deals to recruit athletes to their favoured school.

Now, schools will be responsible for NIL spending. Last year, a federal judge issued an injunction preventing the NCAA from enforcing rules to stop schools from making NIL payments when recruiting athletes.

To regulate payments from schools and boosters, the power conferences have launched a new regulatory body called the College Sports Commission. It has hired Bryan Seeley, the executive vice president of legal and operations at Major League Baseball (MLB), as its chief executive.

In a statement, the commission said Seeley and his team would ‘build out the organisation’s investigative and enforcement teams and oversee all of its ongoing operations and stakeholder relationships’.

‘Seeley and his team will also be responsible for enforcement of the new rules around revenue sharing, student-athlete third-party name image and likeness (NIL) deals, and roster limits,’ the commission said.

‘The commission will investigate potential rules violations, make factual determinations, issue penalties where appropriate, and participate in the neutral arbitration process set forth in the settlement as necessary.’

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In a groundbreaking shift for college athletics, schools will soon be allowed to pay athletes directly, following a federal judge’s approval of a multibillion-dollar settlement that reshapes the structure of amateur sports. The decision finalizes an agreement between the NCAA, major athletic conferences, and Division I athletes, bringing an end to years of legal battles over compensation.

The approved settlement resolves three antitrust lawsuits that challenged the NCAA’s long-standing restrictions on athlete pay. Under the terms, the NCAA will pay nearly $2.8 billion in back damages over the next decade to athletes who competed from 2016 to the present. Beginning July 1, schools may begin issuing payments to current athletes, with an annual cap starting around $20.5 million per school.

This change builds on the momentum from 2021, when athletes were first permitted to earn money from name, image, and likeness (NIL) deals. Unlike NIL compensation, which came from third parties, the new system enables schools to directly pay athletes, marking a significant departure from amateurism standards.

The NCAA and conferences must now rapidly implement the infrastructure for this new model. A new organization—the College Sports Commission—will oversee enforcement, assuming roles previously held by the NCAA’s central office. The commission recently appointed MLB executive Bryan Seeley as its chief executive officer.

Key rules are also being introduced to curb abuses of booster influence. Deals between boosters and athletes will now require a legitimate business justification. Additionally, schools must navigate new roster size regulations, although protections have been added to ensure athletes aren’t removed solely due to the new limits.

While this settlement resolves major disputes, legal uncertainty remains. Questions about whether college athletes should be considered employees are still unsettled, and leaders continue to press Congress for legislative intervention to stabilize the evolving system.

The first institutional payments are set to begin just weeks from now, marking a historic transformation in how college sports are operated.

Source: ESPN