©2020. Published in Landslide, Vol. 13, No. 2, November/December 2020, by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association or the copyright holder.
In California on or around January 1, 2023, student-athletes (or college athletes) will begin selling their name, image, and likeness (NIL) for profit.1 In Florida and Colorado, this will occur two years earlier around the summer of 2021.2 The prospect of student-athletes being able to profit from their NIL is a terrific opportunity that allows for capitalism and amateurism to live side by side.
Professional athletes and celebrities in entertainment have consistently lent their voice, appearance, and talents to brands via commercials, voice-overs, and products for pay. Now student-athletes will have their turn, albeit a short run, considering college generally lasts between nine months and five years, with the highly recruited athletes generally leaving college for the pro ranks earlier. Nonetheless, it will be a legal opportunity to make a profit while enrolled as a student before earning a salary as a professional athlete or, better yet, money to save for future needs if an academic or sports scholarship pays for most of the tuition and expenses.
There are five things that will be fascinating to watch as student-athletes seek trademark protection in the age of name, image, and likeness.
The Value of Social Media
Social media is a very powerful tool.3 Instagram influencers are paid for sharing information based on their number of followers, and many student-athletes have thousands, if not millions, of followers. The sharing of information is generally an advertisement for a brand or product (e.g., a brand partnership in industry talk). The difference in potential value of college athlete brand partnerships on social media is exponential. This is because sports are played on a daily, or at least weekly, basis, whereas in entertainment, a film or television series with one specific actor occurs one to 12 times per year depending on the content. In other words, the student-athlete is appearing on television at least every week during the college sports season, which adds to their popularity on their social media platforms. Where popularity grows (e.g., more followers, likes, comments, shares, and views), the price of utilizing a social media platform to share a brand partnership goes up.
Social media will become a further representation of the personal broadcast system for college athletes, meaning those with a lot of followers and high engagement will receive offers to enter into brand partnerships and get paid to post and/or possibly take ownership stakes in companies, while potentially receiving products as well. Social media is indeed a referee that moves the sticks of monetization.
The Great Brands
Michael Jordan’s “Jordan” brand is iconic. The Jumpman is known worldwide alongside Coca-Cola and Gatorade and is associated with many current and former professional athletes. Jordan was popular in college and, as a freshman, hit the jump shot that clinched the 1982 NCAA National Championship for the North Carolina Tar Heels over fellow freshman Patrick Ewing’s Georgetown Hoyas. What if Jordan could have benefited from NIL during his freshman season or beyond before he was drafted by the Chicago Bulls in 1984?
A good question, but consider the following. Social media did not exist. Broadcast television rights were not nearly as expensive to purchase or viewed by as many fans as today. Streaming and mobile phones were not available with the technology used by consumers today. Lastly, the NCAA along with the NBA and NFL have become more popular since 1982, not less.
On the other hand, Baker Mayfield, Cam Newton, Zion Williamson, and other college athletes represent some of the most popular athletes in the last decade. If asking whether they could have benefited from NIL during their college careers, the answer has to be a resounding yes. This is especially true when considering the present day where social media is king and engagement is queen (and she wears the pants, thank you, Jonathan Perelman). The great brands of athletes begin their rise in college, and if talent takes them there, into the professional ranks. At the very least, trademark protection should be highly sought after and obtained, possibly even when the student enrolls in school. In some sense, the time clock of NIL profiting is just being moved back in time to benefit earlier. Students would be wise to protect their brand with a trademark so as to be able to license it more cleanly and clearly.
Branding through Trademarks
Speaking of trademarks, the most popular brands we have come to know, like Chevrolet, Ford, and Cheerios, would require and would respect an athlete who seeks and obtains trademark protection through the United States Patent and Trademark Office (USPTO) for their brand. It shows hindsight and foresight into branding and thinking about NIL as utilizing the brand to monetize and to speak on topics and areas of like concern. In a way, it shows corporate responsibility, which will only make the athlete more valuable as a brand partner. It may also increase engagement on the athlete’s platform, which as a byproduct increases monetization opportunities.
Athletes should also consider international trademark protection with the ever-expanding international sports footprint. At the end of the day, the brand matters, and it should be protected. Without protection, it becomes harder to license the mark or protect it during disputes with company brands. In the United States, federal trademark registrations obtained through the USPTO will give the athlete the presumption of a valid and enforceable trademark after five years of use and registration and the ability to add an ® after the mark versus the common-law ™ symbol—both powerful tools when protecting and licensing athletes’ NIL and intellectual property.4
Agents and Attorneys
Attorneys may end up playing a significant role in the trademark application process for athletes to help protect athlete client NIL and intellectual property. Under California’s Fair Pay to Play Act, the law does exactly that by specifically allowing attorneys and agents to advise student-athletes and sign with them to help negotiate and secure NIL deals.5 Agents, on the other hand, can be of great service to secure deals for clients with brands and businesses as brokers, as they might land a deal for an actor or professional athlete.
The consulting and recruiting process will be interesting for the legal and marketing aspects. Attorneys could position themselves as the college athlete representatives for trademark law, contracts, and dealmaking, while agents would fulfill similar roles. However, it will be an interesting space to traverse, considering the NCAA and state-to-state law differences. Naturally, there seems to be synergy between the existing dealmakers in the sports industry and college athletes who want and are receiving NIL deals. There is great opportunity here for new dealmakers and large conglomerates, like Learfield IMG College, which already works with colleges to potentially cross the proverbial field to represent student-athletes. Obvious conflicts aside, it would not be difficult to envision new and existing entities and professionals entering the space of creating and protecting NIL intellectual property.
University Involvement and League Reaction
Along with attorneys and agents entering the field (pun intended), this seems to be one of the most fascinating developing areas in the sports industry. For universities, the question is how involved the university will be in the student-athlete NIL and intellectual property and dealmaking process. Under California’s version of NIL, universities have little to no involvement, allowing student-athletes to enter into a free market exchange of NIL rights for dollars, messaging, and voice.6 In other states, in Congress, and at many universities, the conversation is much different. The question for the latter is how much NIL should be regulated by the university or by the state?
In discussions with colleagues, there are some university athletic departments that would like to see significant involvement to help student-athletes broker NIL deals. That help stems from universities and athletic departments already having the institutional knowledge and control over what could be a difficult process. On the other hand, would universities take a percentage of those student-athlete deals, forbid certain deals, or require that funds go into a trust or be used for certain purposes? Interesting questions and concerns indeed.
The opposing argument is that universities should not be involved as a potential competing party since universities secure their own brand, broadcast, and social partnerships. The university-level involvement might be met with opposition as college athletes seek freedom in handling their business matters while preparing for professional careers in or outside of sports. A collaborative discussion on an agreed plan of action is likely the best path forward.
For professional sports leagues like the NFL and NBA, which currently do not offer well-established minor league system development,7 there has been some reaction. Within six months of the California governor signing the NIL legislation, the NBA announced that it would begin a “Professional Pathways Program” through the G-League (the NBA’s development program) for elite high school prospects so as to avoid the NCAA process where appropriate. The NBA has also discussed possibly getting rid of the “one-and-done” rule.
The NFL has shown varying levels of support or encouragement for spring football leagues, like the XFL, Alliance of American Football (Alliance), and Pacific Pro Football League (PPFL). However, the Alliance has folded, the XFL was purchased out of bankruptcy by Dwayne “The Rock” Johnson, and the PPFL has yet to launch. These spring football leagues could have served as feeder or minor leagues for the NFL. Furthermore, the NFL has not to date discussed removing the “junior year draft rule” (plus three years post-high school) for college football, so student-athletes are still required to wait until their later college years to enter the NFL Draft while utilizing the NCAA for its player recruitment needs.
The differing reactions between the NBA and NFL are fascinating because the NBA seems to be planning for the future by offering opportunities to high school graduates to begin making money immediately through salary and brand partnership opportunities because it possibly sees the NCAA and its member institutions as competitors where NIL opportunities are allowed. The MLB, NHL, and MLS are not in this debate for space because they have well-established minor league systems without year or age restrictions, and their most popular players are in the professional ranks. On the other hand, there are arguably several equally popular high school and college basketball players comparative to the NBA. Whereas the NFL’s strongest business argument for no change is that college football development is needed for players to grow stronger to be able to withstand the NFL’s significant size, speed, and strength differences compared to play in the NCAA.
Overall, the professional ranks and the NCAA would be wise to consider how NIL, trademarks, and other intellectual property opportunities for athletes can help not only the individual but also the collective leagues and institutional brands. This makes sense because the student-athletes wear the uniform, while the fans and advertisers mostly see the student-athletes on a broadcast when playing in those uniforms. Even where a student-athlete makes their money on social media through NIL deals, fans will still associate the player with the underlying university, league, and team. That association between the NCAA, brands, and student-athletes brings value that can be monetized for all parties involved through trademark and other intellectual property protection.
Time will tell if social media will help build the next great brands from college athlete NILs that lead to terrific brand partnerships, brokered through attorneys and agents, with support from universities and sports leagues. Lastly, because NIL is based on free market principles like social media following, it increases diversity in dealmaking for men and women of all sports, if they have the followers and engagement brands want.
1. Jeremy M. Evans, Rewarding Student Players, L.A. Law. (Apr. 2020), https://www.csllegal.com/jeremy-evans-on-the-cover-of-los-angeles-lawyer-rewarding-student-players.
2. Dan Murphy, Florida Name, Image, Likeness Bill Now a Law; State Athletes Can Profit from Endorsements Next Summer, ESPN (June 12, 2020), https://www.espn.com/college-sports/story/_/id/29302748/florida-name-image-likeness-bill-now-law-meaning-state-athletes-profit-endorsements-next-summer.
3. Jeremy Evans, Social Media Speak, Sports Radio Am. (June 14, 2020), https://sportsradioamerica.com/2020/06/14/social-media-speak.
4. U.S. Patent & Trademark Office, Protecting Your Trademark: Enhancing Your Rights through Federal Registration (2020), https://www.uspto.gov/sites/default/files/documents/BasicFacts.pdf.
5. Evans, Rewarding Student Players, supra note 1.
7. Jeremy Evans, NCAA Enters the Free Market, Sports Radio Am. (May 3, 2020), https://sportsradioamerica.com/2020/05/03/ncaa-enters-the-free-market.