Recently, the University of Kentucky took an interesting step in the context of collegiate athletics by converting its athletic department into a limited liability company (LLC), named Champions Blue LLC. This structure makes Kentucky the first university in the U.S. to restructure its athletic department in this manner. The move reflects a growing awareness among universities that the traditional model of collegiate sports may no longer be the most financially or legally sustainable model in the face of mounting pressures from name, image, and likeness (NIL) deals, antitrust litigation, and evolving NCAA regulations.
Elad v. NCAA – Former JUCO Player Demonstrates Likelihood of Success in Antitrust Suit Challenging NCAA’s JUCO Rule
On April 25, U.S. District Judge Zahid N. Quraishi ordered the NCAA not to enforce its Five-Year Rule against Rutgers University cornerback Jett Elad.[1] The impact of name, image, and likeness (NIL) agreements on the new world of Division I sports underpinned two key findings in the opinion: (1) the NCAA’s junior college rule (JUCO Rule) is subject to federal antitrust laws; and, (2) Elad had a likelihood of success on the merits because Division I student-athletes have a greater ability to benefit from NIL agreements compared to non-Division I athletes.
NCAA Issues Clarifying Q&A Guidance to Eligibility Waiver
On March 13, the NCAA issued guidance in the form of a Q&A defining the scope of the eligibility waiver it previously approved on December 23, 2024, for student-athletes who have competed at non-NCAA institutions, such as junior colleges (JUCO) and National Association of Intercollegiate Athletics (NAIA) schools. The December 2024 waiver[1] extended an extra year of eligibility in the 2025-26 academic year to student-athletes who previously “competed at a non-NCAA school for one or more years,” and otherwise would have exhausted their NCAA eligibility following the 2024-25 season.