NCAA agrees to settlement in transfer portal lawsuit

The NCAA and multiple state attorneys general, including the U.S. Department of Justice, have agreed to terms on a settlement in the Northern District of West Virginia lawsuit centering around transfer eligibility rules.

Initially filed in December, the case ultimately rendered the NCAA’s multi-time transfer rules powerless. A proposed consent judgment was filed Thursday, outlining the settlement terms. A temporary restraining order against the governing body was granted in December and ultimately turned into a preliminary injunction allowing multi-time transfers to play immediately.

The Division I Council adopted emergency legislation in April allowing all undergraduate athletes to transfer and play immediately as long as they meet specific academic requirements. The settlement agreement calls for the NCAA to be permanently enjoined from enforcing the restrictions.

According to the federal lawsuit, the NCAA’s portal rule “unjustifiably restrains the ability of these college athletes to engage in the market for their labor as NCAA Division I college athletes.” The NCAA agreed to grant an extra year of eligibility to any athletes found ineligible under the transfer rule from 2019 to the initial injunction.

In a major win for the attorneys general, the NCAA has also agreed to “not take any action, nor adopt any rules, by-laws or policies that have the effect of undermining or circumventing the provisions.” Along with paying out attorneys’ fees, the organization is also restrained from enforcing its Rule of Restitution, which allows the organization to retaliate against institutions or athletes who sue and lose.

“It’s not terribly surprising,” Boise State sports law professor Sam Ehrlich said of the settlement. “The temporary injunction kind of forecasted what the judge was thinking on this issue, and it really didn’t look good for the NCAA in this case moving forward. But still, this is a case the NCAA would have fought to the bitter end just a few years ago. To see them settle this quickly shows just how much things have changed in terms of their legal positioning.

“It’s a complete loss for the NCAA.”

The decision to settle the transfer portal-centric lawsuit comes a week after the NCAA and power conferences agreed to settlement terms in the House v. NCAA lawsuit, allowing institutions to pay athletes directly.

“We’ve leveled the playing field for college athletes to allow them to better control their destinies,” Ohio Attorney General Dave Yost said in a statement. “This long-term change is exactly what we set out to accomplish.”