Federal Judge Approves $2.78 Billion Settlement That Could Revolutionize College Sports

In a groundbreaking turn of events for college athletics, a federal judge in Berkeley has given preliminary approval to a hefty $2.78 billion legal settlement that may change the landscape of college sports forever. The deal would allow colleges to pay athletes, a significant shift considering that many have only received scholarships and minimal expenses for decades.

U.S. District Judge Claudia Wilken announced a timeline for the settlement Monday, enabling college athletes to start applying for their share of the payout on October 18. A final hearing is scheduled for April 7, 2025, coinciding with the conclusion of college basketball’s March Madness.

If approved, this settlement will pave the way for major schools to set aside around $21.5 million in the first year to distribute to athletes through a revenue-sharing system. Notably, these athletes will still have the opportunity to pursue income from name, image, and likeness (NIL) deals.

The settlement also addresses former college athletes, allowing those who participated back to 2016 to apply for a portion of $2.576 billion earmarked for them. This fund aims to compensate these ex-athletes for the income they could have generated from NIL endorsements before they became permissible in 2021.

Lawyers involved in the case expect the new payments and benefits for college athletes could surpass $20 billion over the next decade. The sum of $21.5 million represents less than 10% of an average NFL salary cap, showcasing the significant but comparatively modest step forward for college athletics.

Critics of the settlement express concerns about adhering to Title IX, highlighting that around 90% of the distribution is projected to go to football and men’s basketball players. Despite these worries, NCAA officials view the approval as a major win, emphasizing the revised regulations will help college athletics thrive in a modern age.

The settlement also introduces new rules for NIL oversight and modifies existing scholarship limits into roster limits, aiming for stability in an evolving environment where college sports have grown in financial prominence.

This monumental legal decision responds to three major lawsuits against the NCAA, aimed at reforming an old system that many argued was unjust and limiting for athletes. With the landscape of college sports transforming, remains to be seen how each program will adjust to these financial changes and what this could mean for the future of college athletics.