What Does The House Settlement Mean For Ohio State?

A 75-year-old judge from California has changed Ohio State athletics forever.

Judge Claudia Wilken finally approved what has become known as “The House Settlement” on Friday night. The decision roughly means that NCAA schools can now directly pay student-athletes through revenue sharing. The ruling will also see back-pay for student-athletes from 2016-2024.

The effective date of the settlement is July 1, 2025. That is the day when the money is expected to start rolling. The revenue-sharing cap for schools will be put at around $20.5 million for the first year. It is based on a revenue-sharing formula which only a handful of schools will be able to meet.

There are still plenty of questions that come with this ruling. The legality of capping the revenue sharing and limiting what players can earn is atop the list.

But this is the first step towards the next step.

Things are moving forward, but that doesn’t mean it won’t get bumpy along the way.

So how does this ruling impact Ohio State and schools like OSU?

Let’s try to answer some of these questions. (Note: I am not a lawyer and some of these questions may be better answered by somebody with a broader legal background than my own.)

Who will be determining the legitimacy of NIL deals?

Deciding the name, image, and likeness limitations will be a clearinghouse known as “NIL Go.” NIL Go will evaluate all NIL deals above $600 and determine if they are legitimate based on the new guidelines being put into place. NIL Go will be run by Deloitte, which reportedly ran some audits on past NIL deals and found that 90% of deals signed with local companies would have been approved under their guidelines, while 70% of deals with school collectives would have been declined. The idea of a clearinghouse having the power to decline NIL deals already has lawyers sharpening their teeth. And there are still questions about the ability to punish players for breaking compensation rules.

Who enforces the new system of things?

The enforcement arm of this whole deal — known as the College Sports Commission — is already up and running. The CSC also announced Bryan Seeley as its initial Chief Executive Officer on Friday. Seeley came from Major League Baseball, where he “served as Executive Vice President, Legal & Operations at Major League Baseball (MLB) where he served on MLB Commissioner Rob Manfred’s executive leadership team, oversaw investigations into a wide range of issues including circumvention of international compensation caps, and developed and enforced rules in evolving policy areas such as legalized sports betting.” Seeley was an Assistant US Attorney in Washington, DC prior to joining the MLB. Call him “Thor” because he will be the man with the hammer.

Are collectives going away?

No. Collectives will still be around. They will, however, receive more scrutiny than ever before. College football coaches like Ohio State’s Ryan Day have called for legitimate and actual guidelines for NIL. There must be rules and an entity with the power to punish before the discipline can begin. This is the first step towards having a punitive arm that is feared enough to actually work. There will still be legal challenges at some point for denying an NIL deal or trying to punish an athlete for making money.

What does the NIL Go clearinghouse determine?

Whatever you do, don’t say that NIL Go determines the market rate and holds the players to that. That description probably won’t stand up in court. So what NIL Go does instead is establishes a “range of compensation” that “determines whether the subject deal submitted by the student-athlete does not exceed a reasonable range of compensation based on multiple factors, including but not limited to, the deal’s performance obligations, the student-athlete’s athletic performance and social media reach, the local market and the market reach of his or her institution and program.”

What happens if an Ohio State player has an NIL deal rejected by NIL Go?

Let’s say a Columbus vacuum repair shop offers a $700,000 deal to a player. The shop owner is asking for that player to appear for 30 minutes at his shop/porch. The player turns that deal into the clearinghouse and it gets rejected because the number is much too large for the ask. The three options are to 1) go back to the vacuum repairman and get a rate that is more in line with the area and the player’s social media pull; 2) cancel the deal altogether; 3) go to independent arbitration whose ruling will be final.

What happens if a player goes through with a rejected deal?

That’s a pretty good question. The CSC has been given the ability to hand out discipline. Signing a rejected deal could put a player’s eligibility at risk, and could also put the program in danger of playing an ineligible player. There are states with new laws barring the NCAA from punishing players for taking any kind of NIL compensation. The schools in those states, however, have generally agreed to abide by the CSC’s rule.

Are student-athletes going to be employees?

Not if the schools and athletes can help it. Athletes did not want to be employees when polled in the past. The schools don’t want that either. If this is not an employee-employer relationship, however, there are questions of how wages can be controlled in a legal manner. Texas Senator Ted Cruz has said in the past that Congress isn’t going to save the NCAA, but they will help them along the way after the NCAA has attempted to save itself. The House settlement is about as close as the NCAA has gotten to saving itself. It may be enough to get Congress to help out and find a way for compensation to be limited. Or at least legitimized.

How much of the $20.5 million will football get?

Most of it, but not all of it. The expectation is that a program like OSU’s would put about $13-16 million towards football, $2-4 million for men’s basketball, and the rest would be split among the other sports should they warrant compensation.

What does this mean for Title IX?

That is still to be determined by whichever lawyer wants to slowly find out.

Does this mean more scholarships for football?

The roster limit is gradually shrinking from essentially unlimited down to 105 players. This process will take a couple of years. All of those players can now be on scholarship, but they don’t have to be. Some schools have come out and said they will put all of their football players on scholarship. Ohio State’s plan this spring was to go to 90 scholarships. Those numbers are malleable, of course. They’re not going to NOT sign a recruit they want if they’re already at 90 scholarships, for instance. The Buckeyes are expected to have a roster of around 120 players this season. Roughly thirty of those players will still be walk-ons.

Does this mean more scholarships for basketball?

The roster limit for basketball is 15. There is no reason to go to 15 scholarships given that players are free to transfer if they’re not happy with their playing time. It is impossible to keep that many players happy with their playing time. The previous scholarship limit was 13 and we all saw how effective that was at keeping players around.

What does this mean for unlimited transfers?

Nothing. Changing that rule will require collective bargaining, which will likely require Congress to get involved since nobody wants employment status here.

What does this mean for Olympic sports?

Well, every dollar that Ohio State can get for South Stands suites in Ohio Stadium is money they don’t have to take from the Olympic sports. These are going to be volatile times as universities like Ohio State accept the new reality that there is finally a limit to what the athletic department can handle.

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