College athletes are a crucial part of the sports industry, bringing in billions of dollars in revenue for universities and broadcast networks. Still, despite their importance, college athletes have been denied the right to profit from their name, image, and likeness (NIL) until recently. In 2021, the Nevada legislature passed a new law in Nevada, giving college athletes in the state the right to receive compensation for the use of their NIL. However, a new Nevada new NIL law will impact college athletes and the collegiate sports industry.
What is NIL?
Name, image, and likeness rights, also known as NIL, refer to the rights of an individual to control the commercial use of their name, image, and likeness. This includes the right to control the use of one’s name, image, and likeness in advertising, sponsorships, and other commercial ventures. In the context of college athletics, NIL rights allow athletes to earn money from the use of their names, images, and likenesses in connection with their sport.
In Nevada, NIL laws are codified under Nevada’s right of publicity statute. Nevada Revised Statutes Chapter 597.790 grants a right of publicity in one’s name, voice, signature, photograph, or likeness. The right lasts until fifty (50) years after the individual’s death, and it requires written consent for third parties to exploit another’s name, image, or likeness for commercial purposes.
Historically, college athletes have been denied the right to profit from their NIL. This is because college athletics are considered amateur sports, and athletes are not considered employees of their respective universities. Prior to states like Nevada enacting laws permitting college athletes the right to exploit their NIL, the National Collegiate Athletic Association (NCAA) instituted rules barring athletes from profiting or exploiting their name, image, or likeness rights throughout the vast majority of U.S. sports. As a result, student athletes have been restricted from earning any compensation for their athletic performances, including compensation for the use of their NIL. Meanwhile, universities and television networks have been free to use and exploit student athletes’ NIL, leaving college athletes disenfranchised. Nevada’s law changes that.
Assembly Bill 254 (2021)
With the passage of AB 254 in 2021, Nevada has become one of the first states in the nation to pass a law allowing college athletes to receive compensation for the use of their NIL. Under the new law, college athletes in Nevada are now able to sign endorsement deals, receive compensation for the use of their name, image, and likeness in advertisements, and enter into other commercial ventures.
The new law is seen as a significant victory for college athletes in Nevada, who will now have the opportunity to earn money from their athletic careers. However, the law also has broader implications for the sports industry, as other states may follow Nevada’s lead and pass similar laws.
The Impact on College Athletes
While the new law is still in its infancy, its impact could be significant throughout Nevada college sports. With the ability to earn money from the use of their NIL, athletes will be able to generate additional income, which they can use to support themselves and their families. In many cases, this additional income may be the difference between being able to pursue an athletic career or not.
The new law will also provide athletes with the right to exercise more control over their NIL. Instead of having their name, image, and likeness rights solely controlled by a university athletics departments, athletes will now have the ability to control how their NILs are used and to negotiate compensation for their uses.
However, with great power comes great responsibility. Although college athletes have the power to profit from exploiting their NIL, they should be vigilant to navigate this new era of college sports prudently. For example, college athletes may need to retain counsel to draft, review, negotiate, and explain the nature and terms of any NIL deal the student may consider. Additionally, athletes receiving significant NIL deals may want to consult with legal counsel to properly navigate any reporting requirements and tax laws that may apply
About the author
Caleb Green is an Intellectual property Strategist and Sports & Entertainment Attorney in the Las Vegas office of Dickinson Wright PLLC. Caleb also serves as the Treasurer of the Las Vegas Chapter of the National Bar Association.
About this article: This article was originally published in Communiqué, the official publication of the Clark County Bar Association, (Mar. 2023). See https://clarkcountybar.org/member-benefits/communique-2023/communique-mar-2023/.
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