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Almost $2.8 billion NCAA settlement has TCU connection

Sedona Prince, TCU women's basketball center, is one of the lead plaintiffs in a lawsuit against the NCAA that led to a historic multibillion-dollar settlement.
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TCU
Sedona Prince, TCU women's basketball center, is one of the lead plaintiffs in a lawsuit against the NCAA that led to a historic multibillion-dollar settlement.

TCU women’s basketball player Sedona Prince has been a star on the court and in the courts.

She was a lead plaintiff in one of the lawsuits that sparked the nearly $2.8 billion NCAA settlement agreement that paved the way for colleges to directly pay their student athletes.

“It’s historic. It marks the formal end of amateurism for the NCAA,” said Michael LeRoy, a law professor at the College of Law at the University of Illinois at Urbana-Champaign, who specializes in labor issues affecting professional and collegiate athletes. “The NCAA was formed in 1906, and from its inception, it has had rules that prohibit players from being paid for athletic performance.”

The multibillion-dollar settlement awaits final approval from the federal judge hearing the case in California. She must determine if the settlement terms are fair, reasonable and adequate to all class members — a process that experts say will likely take months. The settlement sets the stage to transform college athletics by allowing colleges and universities to share revenues and directly pay up to $20 million dollars per year to its student athletes. 

Both Texas Christian University and the University of Texas at Arlington are Division I schools and will be affected by the agreement if finalized. TCU is in the Big 12, one of the Power Five conferences, and UTA is in the Western Athletic Conference.

UTA is a member of the Western Athletic Conference. The university’s Division I student athletes would be affected by a nearly $2.8 billion NCAA settlement agreement that is pending final approval from a judge.
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UTA
UTA is a member of the Western Athletic Conference. The university’s Division I student athletes would be affected by a nearly $2.8 billion NCAA settlement agreement that is pending final approval from a judge.

The effects of the settlement would play out in vastly different ways at Power Five schools, such as TCU, and lower-division schools, such as UTA.

TCU’s total annual athletic budget is nearly $150 million, while UTA’s is $17.4 million, according to recent federal data filed with the U.S. Department of Education.

The Power Five conferences had a seat at the negotiating table for the settlement. Smaller conferences, which were not an active part of the negotiations, will face an outsize impact on their athletic departments.

House v. NCAA, on which Prince was a plaintiff, was one of three major antitrust NCAA lawsuits that were settled to reach the nearly $2.8 billion agreement. The lawsuits that led to the agreement address the unequal world of college sports, where the NCAA made $1.22 billion in revenue, according to federal tax filings for the fiscal year ending in August 2022.

“The hard work of college athletes has translated into billion-dollar television deals, multimillion-dollar coaching salaries, extravagant facilities and lucrative commercial licensing and sponsorship agreements that greatly benefit the NCAA and its member conferences and schools,” the attorneys for House vs. NCAA state in their court filing.

Yet, attorneys say, student athletes receive only a sliver of the revenue.

The Fort Worth Report reached out to both Prince’s attorneys and TCU to request an interview with the athlete, without success.

Potential price tag for colleges

Major components of the settlement agreement are:

  • Division I student athletes dating back to 2016 — who could not benefit from the marketing of their name and image during their playing days before an NCAA rule was lifted in 2021 — can get a slice of the nearly $2.8 billion settlement. 
  • Payouts for damages will take place over the course of 10 years, and the back pay is not limited to football and basketball players. 
  • Colleges, beginning in fall 2025, can share up to $20 million dollars in revenue with their players. Paying student athletes is not required.
  • NCAA scholarship caps will be removed, allowing athletic departments to spend more.

Universities will have to examine their athletic spending and budget accordingly to cover the extra cash they’ll need if they opt to pay their student athletes. They also will need to consider the percentage mix of scholarships and direct pay that they will give to student athletes and review how money will be distributed between men’s and women’s sports in accordance with Title IX obligations.
The Fort Worth Report asked TCU how it planned to share revenue with student athletes and how it will cover the additional costs. The school was unable to respond by deadline, but a TCU spokesperson said the university plans to release information related to the topic later this week.

TCU is a major athletic school in the Power Five conference. The university’s athletic budget will be affected by a proposed NCAA settlement agreement, if finalized. Universities would be able to share up to $20 million in revenues with their student athletes.
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TCU
TCU is a major athletic school in the Power Five conference. The university’s athletic budget will be affected by a proposed NCAA settlement agreement, if finalized. Universities would be able to share up to $20 million in revenues with their student athletes.

Jeremiah Donati, TCU’s director of Intercollegiate Athletics, addressed the litigation against the NCAA in his May newsletter, which was published weeks before the NCAA settlement agreement was announced in late May.

Donati said he was at Big 12 conference meetings in Arizona with TCU’s head football coach and men’s basketball coach, where, among other things, they talked about the antitrust lawsuits against the NCAA and the Power Five conferences. The employment status of student athletes, elimination of scholarship limits and the involvement of the federal government “continue to be hot item(s) of discussion,” Donati wrote.

“While a significant amount of uncertainty remains, it is pretty clear that big change is coming — and soon,” said Donati. “(There’s) a long way to go on this, but (it’s) certainly something to keep an eye on in the coming months.”

If the agreement goes through, TCU could begin directly paying players in fall 2025. Paying players is optional, and the $20 million amount in revenue sharing with athletes is the upper limit. Colleges can share less. But in the world of college athletics, schools will have to compete.

“TCU is going to have rival schools, whatever they are,” said LeRoy. “And if the rival schools are paying a certain amount of money, then TCU would very likely feel that it’s necessary to match that or get ahead of it.”

TCU, UTA athletic spending budgets

Football is the only sport at TCU that operates with a profit, at about $14.8 million, according to federal data for the reporting year from June 1, 2022, to May 31, 2023.

Men’s basketball operates at around a $480,000 loss, and women’s basketball operates at a nearly $1.4 million loss.

The salary total for head and assistant coaches at TCU is around $24 million.

UTA’s men’s and women’s basketball programs both break even. Men’s basketball spends $2.45 million, and women’s basketball spends $2 million. Coaches’ salaries total nearly $3.26 million.

UTA and the Western Athletic Conference are closely monitoring developments in the proposed settlement, according to a statement from UTA Athletics.

“With final details of the agreement still being discussed and finalized by the NCAA, it is unclear at this time what the specific implications will be for Maverick Athletics,” said UTA Athletics.

Billions in payouts

Colleges do not bear direct responsibility for the nearly $2.8 billion dollars in payouts. For instance, in House v. NCAA, the named co-defendants are the Power Five conferences — not the colleges.

Attorneys for Prince filed the class action antitrust lawsuit in June 2020, when she played for the University of Oregon Ducks. Prince came to TCU in 2023 to play for the Horned Frogs women’s basketball team.

“I don't believe TCU has any additional exposure,” said LeRoy, the law professor, meaning he doesn’t think TCU has any additional liability because Prince is a named plaintiff and currently plays for the university.

Nevertheless, Prince will likely benefit from a greater payout.

“In these class action cases, there are usually additional payouts to the lead plaintiff because of the time they've invested to advance the lawsuit,” LeRoy said.

Colleges could face indirect costs from the multibillion payouts.

The settlement agreement doles out percentages for the responsibility of the payout:

  • The NCAA would cover 41% paid from its reserves.
  • The Power Five, of which TCU is a member, would pay about 24% that would be withheld from future revenues.
  • Smaller conferences, like non-football Division I schools, of which UTA is one, would be responsible for about 12%.

The significant payouts could affect the amount of money colleges get back from the NCAA and its conferences. NCAA gave TCU $1,269,086 in scholarships and grants and gave the Big 12 conference $34,471,896, according to the NCAA’s Form 990 for the fiscal year that ended in August 2022.

Duane Miller, an attorney who works on name, image and likeness issues with college student athletes, calls the settlement agreement “unprecedented.” He’s based in Belton, about halfway between Waco and Austin. He was a Division I student athlete in the late 1980s, playing football for the University of Texas at Austin.

Miller never thought he would see these NCAA changes in his lifetime. He said a lot has changed in terms of the money involved in college sports, but the NCAA has been slow to adapt.

“Millions of people tune in to watch those athletes. They want to see those great throws, catches, runs, tackles, all those things,” said Miller. “But you've got a coach who's a multimillionaire, and then you've got players that should be satisfied with just a scholarship. You know, I think that's a little out of balance.”

Miller said that some college athletes have come to him with questions on when they get paid and by how much.

All he can tell them right now is wait and see.

Fort Worth Report journalist Matthew Sgroi contributed to the reporting of this story.

Shomial Ahmad is a higher education reporter for the Fort Worth Report, in partnership with Open Campus. Contact her at shomial.ahmad@fortworthreport.org. 

At the Fort Worth Report, news decisions are made independently of our board members and financial supporters. Read more about our editorial independence policy here.

This article first appeared on Fort Worth Report and is republished here under a Creative Commons license.