ACC leaders vote to approve settlement in House v. NCAA antitrust case

Atlantic Coast Conference university presidents and chancellors voted to approve a potentially historic settlement in the landmark House v. NCAA case, marking the next step toward college sports green-lighting an industry-shifting revenue-sharing model.

On3 confirmed the news, which was first reported by ESPN.

Each power conference is expected to vote on the settlement over the next few days, in anticipation of the NCAA’s Board of Governors potentially approving the agreement later this week. Attorneys for plaintiffs have set a hard deadline of Thursday for defendants – the NCAA and power conferences – to agree to settlement terms. The ACC was the second conference to approve the settlement after the Big 12 voted for it on Tuesday.

A potential settlement would entail the NCAA and all 32 Division I conferences paying $2.77 billion in damages. It also would enable schools, at their discretion, to share as much as $22 million in revenue with athletes, according to a copy of the proposed settlement summary obtained by On3.

What’s next? In the coming months, U.S. District Judge Claudia Wilken will need to certify the settlement agreement, and represented athletes in the case will have the opportunity to opt-out.

The ACC vote comes against the backdrop of unprecedented tumult in one of the nation’s most history-rich leagues. The future viability of the league is very much in question, as it is plagued by disparate interests, ambitions and extraordinary displays of public rancor.

Two schools – Florida State and Clemson – have filed lawsuits against their own league, beginning to pave the way for those marquee brands to exit and find a home in a more lucrative conference. For several other ACC schools, it remains to be seen what budgetary concessions they must make in order to fully partake in revenue sharing to keep up with well-heeled peers.

Why House case posed existential threat to NCAA

Industry leaders throughout college sports face few attractive options in the face of a class-action lawsuit that sources say poses an existential threat to the NCAA. If the NCAA chooses to take the case to trial in January, it could face a possible $4.2 billion damages bill. 

Still, some pushback has existed among stakeholders, in part, because they do not see a clear way the settlement provides protection from further lawsuits from future college athletes.

The settlement is expected to include an annual mechanism allowing future college athletes to opt-out from or object to settlement terms. That element won’t necessarily protect the NCAA from future litigation. But it could make it more difficult for larger (and far more costly) class-action suits to take hold.

On top of questions over protection from further litigation, many college leaders are grappling with how to budget appropriately in the new age of revenue sharing. 

One industry source told On3: “Most ADs are like, ‘OK, we know it’s coming. How do I practically apply that to my day-to-day budgeting? How many years is it spread out? What are the requirements for spending? Can it be paid through a third-party group? Do I have to cut sports?’ Everyone is discussing that.”