Electronic Arts and the Collegiate Licencing Company have settled a multi-million dollar class action lawsuit over the use of the likenesses of NCAA Division I (and FBS) football and basketball players in EA Sports video games without compensation.
After agreeing to a settlement in principle back in September 2013, the three parties agreed to a settlement worth $40 million for the estimated up to 200,000 players who appeared in the EA Sports NCAA Football and NCAA Basketball / March Madness games since 2003.
The original settlement was held up from being finalized because of a few issues. NCAA objected to EA and CLC settling their lawsuits without their involvement. The lawyers for the three classes of players in the lawsuit also held things up while they argued over how much money everyone would get.
Payments to the plaintiffs will be determined based on a formula that takes into account the number of players who register to receive payment and how many years the players were on an NCAA roster during the applicable time period. After factoring in bigger payments to the lead plaintiffs and one-third of the settlement plus legal fees going to the lawyers, the maximum payments to an individual player is expected to be $4,000.
In an ironic statement, the co-lead counsel for the student-athletes, Steve Berman, said, “I’m thrilled that for the first time in the history of college sports, athletes will get compensated for their performance. It’s pretty groundbreaking.” The irony is that the top student-athletes get money for doing nothing from agents or boosters or the athletics departments. It’s not exactly a secret.
Now all that’s left for the student-athletes is their lawsuit with the NCAA itself. As we mentioned back in September, the NCAA requires athletes to allow the Association the right to use their likenesses as a condition for eligibility to participate in collegiate sports. While the NCAA tries to play this issue off as an EA-caused problem, this settlement doesn’t get them out of the woods yet.