**Historic Settlement Allows Colleges to Directly Compensate Athletes: A New Era in College Sports Begins**

In a landmark decision, a federal judge has finalized the House v. NCAA settlement, ushering in a transformative era for college sports by permitting institutions to directly remunerate athletes. This groundbreaking agreement resolves three antitrust lawsuits against the NCAA and major conferences, establishing a 10-year revenue-sharing model in college sports.

Starting from July 1, athletic departments will be able to distribute approximately $20.5 million in Name, Image, and Likeness (NIL) revenue to athletes, specifically during the 2025-26 season. Historically, athletes could only earn NIL compensation through outside channels, including school-affiliated donor groups, which had become pivotal in recruiting efforts.

The settlement also involves the NCAA and the foremost conferences—the ACC, Big 12, Big Ten, Pac-12, and SEC—agreeing to pay close to $2.8 billion in damages to Division I athletes who were previously barred from signing NIL deals since 2016. These payments will be disbursed over a decade, predominantly benefiting former football and men’s basketball players from power conferences.

NCAA President Charlie Baker referred to the settlement as a "new beginning for Division I student-athletes and for the NCAA" in a public letter, emphasizing the significance of grasping this rare opportunity to stabilize and transform college sports. The approval came from Judge Claudia Wilken of the Northern District of California, known for her earlier rulings against the NCAA in the O'Bannon and Alston cases.

Revisions were necessary to address concerns from objectors about new roster limits, especially those replacing sport-specific scholarship caps with a maximum team roster size, while allowing full or partial scholarships for all roster spots. The settlement was amended to include voluntary "grandfathering" provisions for athletes who lost their roster positions due to these new limits, ensuring they maintain their status throughout their eligibility.

Initially filed in June 2020 by plaintiffs Grant House and Sedona Prince, the House v. NCAA case challenged the restrictions against athletes earning from their NIL rights or sharing in NCAA and conference TV revenue. This case was later consolidated with similar suits, Carter v. NCAA and Hubbard v. NCAA. Fearful of a trial verdict imposing even higher damages, the NCAA and the primary conferences agreed to a settlement in May 2024, with preliminary approval granted in October 2024.

The settlement marks a significant departure from the NCAA's long-standing amateurism model, incrementally dismantled since Judge Wilken's 2014 ruling in favor of plaintiffs in the O'Bannon case. The subsequent Alston v. NCAA case, resulting in a unanimous Supreme Court decision against the NCAA, further eroded restrictions on athlete compensation, specifically focusing on academic expenses.

Since the relaxation of NIL rules, athletes have secured lucrative deals, with notable examples including Ohio State's football team earning $20 million in NIL revenue and Texas Tech softball star NiJaree Canady signing multiple million-dollar agreements. Despite initial enforcement attempts by the NCAA to curb "pay for play" schemes, legal challenges have limited such actions, highlighting the rapidly evolving landscape of college sports compensation.