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Much has been made of the rule changes in college athletics, with the NCAA allowing college athletes to profit off of their name, image, and likeness since July 1st, 2021. The NIL market—already a billion-dollar industry—is only set to grow, as more businesses will seek to capitalize on the opportunities provided through athlete sponsorship. The “NIL era” has been tremendously beneficial for college athletes, but is also a game changer for small businesses and national corporations that seek to operate in the high-ROI athlete and influencer marketing space.

Since July 1st, 2021 dozens of service providers have entered the NIL market. Many companies now provide college athletes and universities with NIL-related education and services. However, with so much educational material and services tailored towards college athletes, there has been little educational information developed for the sponsors seeking to partner with college athletes.

While the emphasis for college athletes has been on compliance with NCAA rules, state laws, and internal university policies for the purpose of ensuring their continued athletic eligibility, businesses seeking to work with college athletes should also be concerned with the legal implications of NIL deals. Of course, companies should seek to have well-drafted contracts in all aspects of their business dealings. However, in entering into NIL contracts with college athletes, businesses should take particular care to adhere to all relevant rules and laws. The downside of glossing over those rules and laws can extend far beyond the PR disaster of having a situation where a college athlete or university is in trouble with the NCAA. 

The benefit of partnering with a college athlete to promote a product or business is immense. College athletes often have huge platforms and many fans. With tremendous social media followings and loyal supporters, these athletes have excellent voices to help target audiences engage with your business. Consider the following steps to engage with college athletes and effectively use their NIL to grow your brand: 

Connect with College Athletes on Social Media or Through Marketplace Platforms

The easiest way to connect with college athletes is through their social media accounts. It is also an easy way to see their following and engagement on other posts. A simple “DM” can be a great start to a partnership. Many college athletes are also listed on influencer marketing transaction platforms, such as Opendorse or MarketPryce. You can sign up for a business account and see athletes that are listed on the exchanges. These platforms do typically charge a transaction fee (sometimes as high as 30% of the deal), either to you or to the athlete you are connecting with. Additionally, some college athletes have hired marketing agents to put together NIL deals for them. Be prepared to negotiate terms with a college athlete’s representative. However you connect with athletes, offering them a deal is the place to start. 

Ensure the Deal is in Compliance With all Relevant Rules, Laws, and Policies

The regulatory landscape surrounding NIL can be complex; you must adhere to NCAA rules, state laws, and institutional policies. The NCAA’s interim NIL policy directs college athletes to follow their state NIL laws, and in states where there is no NIL law, to follow their institutional or conference NIL policy. The NCAA’s NIL rules also allow college athletes to retain professional service providers to represent them. You may find yourself negotiating an NIL deal with an attorney or agent. Finally, the NCAA does still prohibit deals that constitute “pay-for-play” or serve as recruiting inducements. It is important to draft contract language that could not be construed as either. 

Although many states have similar laws regulating college athlete NIL, it is important to consider the nuanced differences between them. Typically, you should consider the restrictions of the NIL law in the state where the college athlete plays. That law will be critical—regardless of where your business is located or incorporated. Be sure that no portion of the contract you offer to a college athlete is in violation of their state’s NIL law. 

Finally, consider the NIL policy of the institution that the college athlete attends. These can differ quite substantially. Certain schools allow the athletic department to facilitate deals for their players. Other schools prohibit institutional involvement completely. The athletic department’s website is the first place to check for any restrictions that the college athlete may have in finalizing the deal. You should also check for any reporting requirements the institution may have. 

Check the Intellectual Property Provisions in Your Contract

At its core, an NIL deal is a limited grant of intellectual property rights. While a college athlete has the authority to grant you the right to use their name, image, and likeness, they do not typically have the ability to use their university’s intellectual property. There are alternative avenues to securing such a license. Additionally, some universities permit their players to engage in NIL activity in team-issued apparel, but others do not. It is important to draft appropriate contract language, that correctly reflects the intellectual property provisions of the deal. 

Consider Other Relevant Laws

In addition to NIL-specific state laws, there may be other laws that play a factor in your NIL deals with college athletes. They might include state right-of-publicity statutes or common laws, tax laws, employment laws, and even immigration laws for international student-athletes. The variety of laws that play a factor can impact much more than a college athlete’s eligibility. They can directly impact your business as well. 

Send the College Athlete a 1099 and Other Relevant Tax Documents

After you have provided compensation to the college athlete and the athlete has provided the required deliverables, you must provide tax documentation for the deal. You must provide an IRS Form 1099 to any athlete who you have paid over $600. 

While there are many benefits to partnering with college athletes as a business—including the opportunity to help increase sales and develop brand affinity—there are also risks. It is important to be strategic and provide college athletes with NIL contracts that are compliant with all relevant rules and laws. Consider hiring an attorney with broad experience drafting NIL contracts to help meet your legal needs.

As the second school year of the NIL era is about to begin, many collegiate student-athletes have taken advantage of the opportunities that have come with the ability to market their name, image, and likeness. In year two, college athletes should consider taking the next steps to advance their NIL activity. Here are four things to help take your NIL to the next level this year: 

Enhance your Personal Branding by Creating a Logo

Creating a personal logo can help improve your brand recognition and marketability. Companies looking to sign college athletes to NIL deals always like to see that you are proactive in establishing your brand. A graphic designer can help you create a simple (but recognizable) logo that contains your name or initials and your number. After creating a logo, you can register a trademark with the U.S. Patent and Trademark Office to ensure that you have maximum legal protection. Having a registered trademark is also helpful for licensing purposes when you are signing NIL deals. 

Work with a Marketing Agency 

Hiring a marketing agency to secure NIL deals can help college athletes earn greater compensation and access a more diverse set of companies to work with. However, working with an agency can have long-term implications for athletes, their income, and their intellectual property. It is important to have a lawyer review any contracts that you sign with an agency, to ensure that you are getting a fair deal. 

Host Camps and Provide Lessons 

An effective way for student-athletes to capitalize on their NIL is by hosting camps and giving lessons. Although it requires more effort than a social media post, camps and lessons can create substantial income. Hosting a camp or giving private lessons may sound straightforward, but it will require some legal planning. Student-athletes may need to sign contracts with facilities, equipment providers, and event sponsors. Additionally, liability planning can include establishing a limited liability entity and creating a liability waiver for participants to sign.

Create an LLC 

A smart way to protect yourself and your personal assets is through establishing an LLC or another type of legal entity with limited liability. Establishing a business entity can provide tax benefits as well as legal protection for your personal assets. As your NIL activity becomes more complex, an LLC becomes more beneficial. 

It is more important than ever for college athletes to think long-term and big picture with NIL. Make sure to protect yourself, protect your brand, and protect your assets. Effective legal counsel can help ensure that you are signing quality contracts, guarding your intellectual property, and minimizing legal risk.

By Joshua Frieser

Joshua M. Frieser, Esq. is a sports lawyer and Principal Attorney at Frieser Legal. His practice is focused on the representation of college athletes and working to solve their unique legal needs. Josh represents college athletes in formal NCAA regulatory proceedings and NIL licensing agreements, as well as in related intellectual property and business planning matters.

Beginning on July 1, 2021, the NCAA amended its bylaws to allow student-athletes to receive compensation in exchange for their Name, Image and Likeness (NIL) for the first time. College athletes across the country have since signed thousands of endorsement deals worth millions of dollars. One projection expects the college athletics NIL market to grow to $1 billion in the next five years. Notably absent from NIL activities have been the majority of the NCAA’s approximately 20,000 international student-athletes. Recently, a campaign was launched to help international student-athletes gain the ability to market their NIL, but Congress will ultimately have to legislate on the issue. The NCAA and the states that have passed (and amended or repealed) NIL laws cannot give international student-athletes the right to earn NIL compensation.

Most international students attend colleges and universities in the United States after obtaining an F-1 or J-1 student visa. These “non-immigrant” class visas permit international students to travel to the United States and study at Student and Exchange Visitor Program (SEVP)-certified universities or colleges. The SEVP is a Department of Homeland Security program which records essential information about international students. The program also provides approval and oversight to certified institutions along with advice to both institutions and students about visa status as an international student and how to maintain eligibility. These student-visa categories have very specific requirements and limitations, and this is especially true with respect to employment and compensation.   

Students who entered with F-1 visas are allowed to do some work ‘on campus’ but need a work permit in order to obtain an ‘off campus’ job or internship (which is generally not permitted during the first academic year). After graduation these students are eligible to apply for Optional Practical Training (OPT) or Curriculum Practical Training (CPT) to work or train in the United States for up to 12 months after graduation (or an additional two years for graduates with STEM-related degrees). Students who entered with J-1 visas are permitted to engage in work and study related exchange programs at US colleges and universities but are required to obtain a work permit (for ‘on campus’ and ‘off campus’ work). 

The consequences of violating the terms of these student visas are severe and can result in the termination of the visa, removal of the student from the United States and could prevent them from entering the United States in the future. 

With the recent Supreme Court ruling in Alston and the NCAA’s legislative changes permitting student athletes to sign Name, Image and Likeness (NIL) endorsement deals with various companies, a question is often raised—are athletes in the United States on student visas able to sign similar endorsement deals? Put another way—would signing an NIL deal constitute impermissible employment that would violate the terms of their student visa? Unfortunately, there is no ‘one size fits all’ answer because of the various ways endorsement deals can be structured (and the country in which the deal was entered and the compensation paid). For example, Kentucky guard Shaedon Sharpe signed a high-profile NIL deal with SoleSavy, a Vancouver-based sneaker company. Importantly, Sharpe is a Canadian citizen and his NIL contract with SoleSavy is presumptively governed by the laws of Canada. Sharpe’s teammate at Kentucky and National Player of the Year Oscar Tshiebwe has also been able to monetize his NIL as an international student-athlete, although the details of how he has been able to do so are less apparent.

Generally speaking, however, most international student-athletes are advised not to accept any NIL deals because of the possibility that it can be interpreted as unauthorized employment—which would make the school to legally obligated to terminate the visa. The definition of “employment” in this context is very vague, and many schools will advise their international students to avoid all NIL opportunities to prevent a possible violation—as the interpretation of this term is ultimately up to the federal government if there is a violation. 

This issue has not gone unnoticed by other student-athletes, the NCAA and members of the U.S. Congress. UConn women’s basketball star Paige Bueckers, who has signed lucrative endorsement deals with Gatorade and clothing marketplace StockX, was quoted as saying that she is well aware that she is being given opportunities that are not available to her international teammates. Some members of the U.S. Congress have called for a federal law that would allow all college athletes (including those on student visas) to benefit and be compensated for the use of their name, image or likeness.  Until that happens however, international student-athletes will likely continue to avoid NIL endorsement deals. 

For those international student-athletes who do want to enter into an endorsement deal, it is highly recommended that both the student-athlete and the company seeking to endorse them consult with attorneys familiar with sports law, business law and immigration law to avoid possible severe penalties in the future.

By Joshua Frieser and Alex Troyb

Joshua M. Frieser, Esq. is a college sports lawyer and Principal Attorney at Frieser Legal. His practice is focused on the representation of college athletes and working to solve their unique legal needs. Josh represents college athletes in formal NCAA regulatory proceedings and NIL licensing agreements, as well as in related intellectual property and business planning matters.

Aleksandr Y. Troyb, Esq. is a business and immigration lawyer and Partner at Benjamin, Gold & Troyb, P.C. Alex relies on his diverse background to advise clients on various aspects of immigration, residential and commercial real estate as well as residential and commercial financing.  In addition, Alex assists clients with civil litigation, business entity formation, construction and development law, estate planning and probate administration.

With the spring semester nearing its conclusion, spring football is underway, and the NCAA men’s and women’s basketball tournaments have wrapped up. A common occurrence at this point in the semester is student-athletes entering the transfer portal. In the wake of changes in both NCAA and conference legislation requiring transferring student-athletes in some sports to spend a year in residence prior to returning to competition, the transfer portal has never been more popular, powerful, or impactful on intercollegiate athletics. The NCAA has recently released research and statistics on the transfer portal and its impacts.

When a student-athlete enters their name into the portal and is deciding which school should be their next home, there are many factors that influence their decision. Many of these factors are well known, from the facilities schools have, increased playing time, and an improved possibility of making it to the professional level. However, in the wake of the Supreme Court’s decision in the Alston case, and the NCAA’s easing of NIL restrictions, there are many legal factors that student-athletes should now consider when entering the transfer portal.

In the post-Alston era, the NCAA is no longer able to cap education-related benefits that schools can offer to student-athletes. While it is still unclear what exact benefits each school will offer their athletes, some universities have started to offer a stipend for achieving certain academic marks, such as achieving a particular grade point average or simply by maintaining academic eligibility to compete. At least 22 Division I, FBS-level universities plan to offer such a stipend. In addition to a cash stipend, many have speculated that universities will offer student-athletes the opportunity to obtain prestigious internships or attend a graduate school cost-free. Student-athletes should be aware of this broad change and realize this is another area where schools will try to differentiate themselves in recruiting. While many student-athletes will not play professionally, education-related benefits have substantial short-term and long-term benefits that many student-athletes should be aware of and consider when both choosing a school to attend.

Some potential Alston benefits that student-athletes could receive are computers or other technology needed to complete academic studies, musical instruments, post-graduate scholarships, and graduate program acceptance. The list of education-related benefits will only continue to expand in the years to come. Since many college student-athletes do not receive full cost-of-attendance athletic scholarships, these education-related benefits can greatly make up the difference some student athletes have to pay out of pocket to continue their academic studies. Student-athletes should be aware of these new benefits and consider what education-related benefits schools are offering when making the decision to transfer.

With the NCAA easing restrictions on student-athletes’ ability to earn compensation from their name, image, and likeness (NIL), states and individual schools have enacted laws and policies that lay out different guidelines. These policies can also have a significant impact on the decision of a student-athlete to transfer. Certain states and schools will have more restrictive policies, while others will be more lenient. Student-athletes looking to monetize off their NIL rights need to consider the differences in state laws and school NIL policies when deciding which school to attend.

An example of a restrictive provision that student-athletes should be aware of is the ability to sell school-assigned apparel on a third-party website. In the wake of the NCAA men’s and women’s basketball tournaments, basketball student-athletes have a lot of March Madness apparel and merchandise they could potentially sell. Depending on their school policy they may or may not be allowed to. Another provision student-athletes should be aware of is the ability to wear in-game apparel, like sneakers, that may be from another brand as an existing school sponsor. Many schools will prohibit this, but some have stated in their policies that their athletes would be allowed to do so. Finally, student-athletes should note the differences in schools’ policies on the use of the school’s intellectual property rights in student-athletes NIL promotions. Certain states and schools are restrictive and prohibit student-athletes from using the school’s intellectual property for NIL purposes, while other schools are allowing student-athletes to enter into group licensing deals while using the school’s trademarks.

It is important for student-athletes to read through and analyze the NIL policy for the schools they are considering transferring to in order to determine which school has a policy that fits their desired NIL needs. While many schools have slightly different NIL policies, the differences can have substantial implications for incoming and transferring student athletes. With an understanding of the legal factors to consider when deciding on what school to transfer to, student-athletes will be more educated on which school fits their desired needs the best. Of course, some will largely only consider the “on-field” factors, but for many student-athletes the legal factors can have as big of an impact on deciding where their future home will be. These changes are novel and the effects of them are still developing, but current student-athletes should educate themselves on the legal issues affecting them in the transfer portal.

By Paul Kekich

Paul Kekich is a Sports Law Intern at Frieser Legal and a second-year law student at Marquette University law school where he is pursuing his J.D. with a focus on sports law and intellectual property law. Paul’s studies are focused on a potential future of working in collegiate sports, as well as identifying new and emerging issues that affect college athletes.

With college athletes able to profit off their name, image, and likeness (NIL), many have turned to creating and building their own brands. Building a brand can come with the use of a trade name and a personalized logo, specific to the student-athlete. Utilizing a brand name and logo can potentially expose a student-athlete to legal liability. Student-athletes should work to ensure that their NIL activities do not infringe on any others’ intellectual property rights, including the intellectual property rights of their university.

There are countless registered and unregistered trademarks that a student-athlete could potentially infringe upon. It is important for student-athletes and their representatives to be proactive in order to protect against trademark infringement liability. Understanding that specific names and logo designs may need to be altered to avoid liability is important. There are multiple steps student-athletes and their attorneys can take in order to avoid infringing on the intellectual property of others.

Trademark rights and protection are codified under the Lanham Act. A person or business can be found liable for trademark infringement under the Act if: (1) they use any reproduction, counterfeit, copy, or imitation of a mark; (2) without the registrant’s consent; (3) in commerce; (4) in the connection with a sale, offering for sale, or advertising of any goods; (5) where such use is likely to cause confusion, or to cause mistake or to deceive. Essentially, student-athletes and their representatives need to make sure that their trade name or logo is not substantially similar to another trademark that it will cause a likelihood of confusion to consumers. Courts will look to see if the potentially infringing mark has the effect of appearing as if the registered mark owner approved or licensed the new mark to use its design.

In a trademark infringement case, courts will use specific factors to determine where a claimed infringing mark would likely confuse consumers with an already registered mark. Student-athletes can be mindful that each federal circuit court has its own set of factors, even though many overlap. Depending on the location of the alleged infringement, different factors may apply. A few common factors courts will use are: (1) the strength of the plaintiff’s mark; (2) similarity of design between the marks; (3) similarity of the products; (4) identity of retail outlets and purchasers; (5) similarity of advertising media used; (6) the defendant’s intent; (7) actual confusion; and (8) degree of care exercised by potential purchasers. Courts will weigh each factor in favor of one party or the other. While no one factor can prove infringement, a majority is not needed to show infringement as well. Courts will decide on a case-by-case basis, under the case’s specific facts, to determine if a claimed infringing mark would likely cause confusion.

There are multiple steps student-athletes can take to ensure their new trade names and logos are not infringing upon a registered mark. First, student-athletes need to make sure their new brand name and logo are unique and distinct from existing names or logos. In addition to conducting some trademark research and due diligence, student-athletes should ensure they are not copying or imitating any design elements of well-known brands.

Second, student-athletes and their representatives need to be aware of the potential products they may be using their brand name and logo on when designing them. Student-athletes should research what other logos and trademarks are commonly used on the same products that the student-athlete wishes to sell. They should also be aware of where these products will actually be sold. If they appear in stores where other similar marks are sold, infringement is more likely. If student-athletes are able to ensure their products are sold online or through personalized streams of commerce, there will be less likelihood that consumers would get their products confused with others.

Third, student-athletes and their representatives should research the likelihood that their new design could be confusing with an already existing design. This could be done by using surveys to ask potential customers if they find any confusion between the student-athletes mark and the already registered mark. Student-athletes and their representation should also research their potential markets, both in a geographical sense and a product category sense, of any existing registered marks that appear similar to the design of the student-athletes’ new mark.

Overall, there are multiple steps student-athletes and their agents or attorneys can take in order to ensure they are not liable for trademark infringement. With the NIL market continuing to grow, more student-athletes will be entering the NIL space and creating businesses, trade names and logos. If a student-athlete is working to build their brand, they should strongly consider how intellectual property may affect their NIL activities.

By Paul Kekich

Paul Kekich is a Sports Law Intern at Frieser Legal and a second-year law student at Marquette University law school where he is pursuing his J.D. with a focus on sports law and intellectual property law. Paul’s studies are focused on a potential future of working in collegiate sports, as well as identifying new and emerging issues that affect college athletes.