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CSC said in a statement that the arbitrator upheld the commission’s decision to reject third-party NIL agreements between Nebraska’s multimedia rights (MMR) partner, Playfly, and the players.
At issue was whether Nebraska’s MMR partner would be considered an “associated entity” — deals that are subject to CSC scrutiny.
With that settled, the CSC said the arbitrator rejected the agreements because:
— They lacked what the CSC calls a “valid business purpose” because they did not include goods or services offered to the public for profit.
— Playfly violated a rule against “keeping” NIL rights — ie. to pay for the rights to use for some purpose later instead of using them immediately.
Speaking to the media at the Atlantic Coast Conference meetings in Florida, CSC CEO Bryan Seeley said he did not consider the agreement a precedent.
“Even though it’s not precedential, it’s a fact that it’s influential and it’s influential in people’s minds about how they think about enforcement,” he said. “So for me it was a good day.”
Nebraska Cornhuskers wide receiver Jacory Barney Jr (2) and tight end Luke Lindenmeyer (44) celebrate a touchdown during the SRS Distribution Las Vegas Bowl featuring the Nebraska Cornhuskers vs. Utah Utes. (Photo by Steve Nurenberg/Icon Sportswire via Getty Images)
CSC said it would release the arbitrator’s full decision later.
Some observers are curious to see if the university or the state will sue the decision, something CSC hoped to avoid when it issued a “participation agreement” for schools to sign that prohibits them from suing the commission.
Many schools have been reluctant to sign the agreement, arguing that under their state laws they are not allowed to sign away their ability to take legal action.
“It’s whether their attorney general challenges it in court and what the outcome of that is, I think that’s the true test of whether this (CSC) is a legitimate governing body,” sports attorney Paia LaPalombara told The Associated Press in an interview last week, discussing the Nebraska case.
In acknowledging the decision, Nebraska AD Troy Dannen said the school would continue to operate under the CSC process “while monitoring changes in the collegiate landscape.”
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“We fully support all of our student-athletes in maximizing the value of their name, image and likeness during their time at the University of Nebraska,” he said.
Officials with the Nebraska attorney general’s office did not immediately respond to emails from the AP.
Seeley still believes there are ways for the Nebraska players to be paid within the rules.
“I don’t think lawsuits are necessary for these student-athletes to get money for their NIL,” he said. “However, I cannot control what happens outside of what we do.”
In a separate case pending in federal court that approved NIL payments via the House settlement, attorneys argue that MMR partners should not be considered “associated entities.” A hearing in the case is scheduled for May 27.
Report from the Associated Press.
