On February 23, U.S. District Judge Clifton L. Corker of the Eastern District of Tennessee granted a preliminary injunction requested by the Tennessee and Virginia attorneys generals (AG) against the NCAA’s “NIL-recruiting ban.” This ban prohibits boosters and collectives from discussing name, image, and likeness (NIL) opportunities with student-athletes before they commit to a school. The court found that the AGs had established both a likelihood of success on the merits and irreparable harm that would occur without the injunction. This decision could have significant implications for the landscape of college sports.
The lawsuit, filed by Tennessee AG Jonathan Skrmetti and Virginia AG Jason Miyares, argued that the NIL recruiting ban constitutes an illegal agreement to restrain and suppress competition within the relevant labor market, in violation of Section 1 of the Sherman Antitrust Act. The court agreed with the plaintiffs, stating that the NCAA’s market power over Division I athletics is “undeniable” and that the challenged rules would “likely harm competition” because they “suppress price competition by limiting negotiating leverage, and, as a result, knowledge of value.”
The court also concluded that student-athletes faced irreparable harm from the continued enforcement of the NIL-recruiting ban. The suppression of the student-athletes’ negotiating leverage and lack of knowledge as to their own value represented an irreparable and nonmonetary harm to student-athletes. The court noted that the window of opportunity is small for recruitments, commitments, and transfers; moreover, these are the periods in which the student-athletes have the highest negotiating leverage with NIL collectives and can realize the most value.
The court’s decision effectively means that, from the date of the opinion, the NCAA may not enforce the policies related to its NIL-recruiting ban on Division I member institutions. However, the court did not hold that the NCAA may not otherwise regulate student-athlete NIL activity, and neither the opinion nor the order reach the other various components of the NCAA’s interim policy or its subsequent supplemental guidance. The future of student-athletes’ ability to generate revenue from their NIL and utilize their market value in negotiations with schools and collectives, and their decisions regarding which schools to attend, remains in flux.