The New NIL Deals in College Sports

By Anna Mestel

The world of college sports is undergoing a major transformation with the introduction of new rules governing Name, Image, and Likeness (“NIL”) deals. NIL refers to a college athlete’s right to profit from the commercial use of their name, image, and likeness as part of their personal brand.[1] Prior to 2021, student-athletes were prohibited from entering into agreements that allowed them to profit from their fame.[2] That changed in 2021, when athletes were granted NIL rights and permitted to monetize their athletic ability.[3] Today, athletes sign major contracts not only with traditional sports brands such as Nike and Adidas, but also with non-athletic companies, including fast-food chains like Popeyes.[4] For example, former Colorado quarterback Shedeur Sanders reportedly held a $4.7 million NIL valuation before entering the NFL.[5] Similarly, Texas quarterback Arch Manning reportedly secured deals with Uber, Vuori, and Red Bull, with his NIL valuation measured at $3.8 million in 2023.[6]

In June 2025, the landmark House v. NCAA antitrust class action settled allegations that the NCAA had unlawfully restricted the earning power of college athletes.[7] As a result of this settlement, universities will now be permitted to compensate their athletes directly, subject to an annual cap of approximately $20.5 million per school for the 2025–26 academic year.[8] The settlement preserves the ability of student-athletes to continue entering into NIL deals with third parties. However, these agreements must serve a valid business purpose and reflect fair market value,[9] which seeks to identify “[w]hether the payor is seeking the use of the student-athlete's NIL for a valid business purpose, meaning to sell a good or service to the public for profit."[10] Since the new model, the College Sports Commission (“CSC”) has cleared roughly $80 million of NIL deals.[11]

The role of arbitration in the administration of NIL agreements will be a critical component of the new regulatory framework. Under the House v. NCAA settlement, any third-party NIL deal valued above $600 must be submitted to the CSC, which functions as a clearinghouse to evaluate whether agreements serve a valid business purpose and reflect fair market value.[12] To facilitate this process, the CSC, in partnership with Deloitte, launched NIL Go.[13] NIL Go functions as a portal through which athletes must report their NIL contracts for review.[14] Submitted deals are assessed based on factors such as payor association, valid business purpose, and range of compensation.[15] Only after clearance through NIL Go may the athlete proceed with the deal.[16] If the portal denies clearance, the CSC initiates an investigation to further analyze the information provided.[17] In such cases, athletes may choose to revise their agreements to address deficiencies or appeal the denial to a neutral arbitrator.[18] If athletes wish to appeal the decision, they have 14 days to initiate the arbitration process.[19] Otherwise, the denial is binding.[20] This arbitration mechanism is intended to minimize traditional litigation by providing a streamlined, specialized process for resolving disputes arising from NIL rights of athletes.[21] Given the high stakes of endorsement opportunities, the arbitration review process will play a central role in balancing regulatory oversight with the athletes’ rights.

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[1] Daniel Mader, How Does NIL Money Work in College Football? Explaining The Meaning, Rules and Who Pays the Athletes, Sporting News (Sept. 19, 2025), https://www.sportingnews.com/us/ncaa-football/news/how-does-nil-money-work-college-football-rules-athletes/ed5085f9f5c6fcf01db52586 [https://perma.cc/BW55-TYRP].

[2] See Sara Coello, What Is NIL In College Sports? How Do Athlete Deals Work?, ESPN (Mar. 24, 2025, at 17:28 ET), https://www.espn.com/college-sports/story/_/id/41040485/what-nil-college-sports-how-do-athlete-deals-work [https://perma.cc/Z4CN-D76J].

[3] Id.

[4] Id.

[5] Id.

[6] Top 25 College Athletes with Highest NIL Valuations, Fox Sports (Jun. 7, 2025, at 13:41 ET), https://www.foxsports.com/stories/college-football/top-25-college-athletes-highest-nil-valuations [https://perma.cc/8KBD-2L5Z].

[7] Dan Murphy, Judge OK's $2.8B Settlement, Paving Way for Colleges to Pay Athletes, ESPN (Jun. 6, 2025, at 21:28 ET), https://www.espn.com/college-sports/story/_/id/45467505/judge-grants-final-approval-house-v-ncaa-settlement [https://perma.cc/NKR2-SUZ8].

[8] See Brandon Marcello, House v. NCAA Settlement Approved: Landmark Decision Opens Door for Revenue Sharing in College Athletics, CBS (Jun. 6, 2025, at 22:51 ET), https://www.cbssports.com/college-football/news/house-v-ncaa-settlement-approved-landmark-decision-opens-door-for-revenue-sharing-in-college-athletics/ [https://perma.cc/D9VX-4HQ7].

[9] Mader, supra note 1.

[10] Will Backus, What Is NIL Go? Explaining The College Sports Commission's Initiative to Monitor Name, Image and Likeness, CBS (Jul. 10, 2025, at 12:45 ET), https://www.cbssports.com/college-football/news/what-is-nil-go-explaining-the-college-sports-commissions-initiative-to-monitor-name-image-and-likeness/ [https://perma.cc/LHR9-5FJP].

[11] More Than 8,300 NIL Deals Worth $80M Approved by New Commission, ESPN (Sep. 4, 2025, at 09:37 ET), https://www.espn.com/college-sports/story/_/id/46154733/more-8300-nil-deals-worth-80m-approved-new-commission [https://perma.cc/WN43-WQWV].

[12] See Stewart Mandel, New NIL Enforcement Targets Collectives, Deals Must Serve ‘Valid Business Purpose’, N.Y. Times (Jul. 10, 2025), https://www.nytimes.com/athletic/6486575/2025/07/10/name-image-likeness-collective-deals/ [https://perma.cc/NXA4-MFXB].

[13] Backus, supra note 10.

[14] Id.

[15] Id.

[16] Id.

[17] Id.

[18] See Michael McCann, Clearinghouse Denial of NIL Deals to Be Limited by Arbitration, Sportico (Jun. 8, 2025, at 16:51 ET), https://www.sportico.com/law/analysis/2025/arbitration-nil-clearinghouse-lawsuits-1234855588/ [https://perma.cc/4MJP-BGXX].

[19] Enforcement, Coll. Sports Comm’n, https://www.collegesportscommission.org/enforcement/ [https://perma.cc/ASX5-H77U] (last visited Sep. 19, 2025).

[20] Id.

[21] See Karen Weaver, NIL Contracts and Disputes: Will They Shape the Future Of College Athletics?, Forbes (Mar. 3, 2025, at 09:25 ET), https://www.forbes.com/sites/karenweaver/2025/03/03/nil-contracts-and-disputes-will-they-shape-the-future-of-college-athletics/ [https://perma.cc/282C-K454].