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The CSC said in a statement that the arbitrator upheld the commission’s decision to reject third-party NIL agreements between Nebraska’s multimedia rights partner (MMR), Playfly, and the players.
At issue was whether Nebraska’s MMR partner would be considered an “associated entity” – whose transactions are subject to SCC scrutiny.
That being decided, the SCC said the arbitrator rejected the agreements for the following reasons:
— They lacked what the SCC calls a “good business purpose” because they did not include goods or services offered to the general public for profit.
— Playfly violated a rule prohibiting “banking” of NIL rights – that is, paying for the rights to use them for later purposes 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 view the agreement as a precedent.
“Even though it’s not a precedent, the fact is that it has influence, and it influences the way people think about law 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 against the Utah Utes. (Photo by Steve Nuremberg/Icon Sportswire via Getty Images)
The SCC said it would issue the arbitrator’s full decision at a later date.
Some observers are curious to see whether the university or state will take legal action over the decision, something the CSC hoped to avoid by sending a “participation agreement” for schools to sign, barring them from suing the commission.
Many schools have been reluctant to sign the agreement, arguing that they are not allowed under their state laws to give up their ability to sue.
“It’s a question of whether the state attorney general challenges it in court and what the outcome will be. I think that’s the real test of whether this (CSC) is a legitimate governing body,” sports attorney Paia LaPalombara told The Associated Press in an interview last week about 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 thinks there are ways for Nebraska players to get paid according to the rules.
“I don’t believe litigation is necessary for these student-athletes to get money for their NIL,” he said. “But I can’t control what happens outside of what we do.”
In another pending Federal Court case that approved NIL payments through the House Regulations, lawyers argue that MMR partners should not be considered “associated entities.” A hearing in the case is scheduled for May 27.
Associated Press reporting.
