Take It to The House? Legal Risks for Universities Bringing NIL Collectives In House

In an article published in the July-August 2023 edition of the LEAD1 Association’s Name, Image, and Likeness Institutional Report, Nelson Mullins partner Dan Cohen described the principal risks to universities that are considering bringing NIL collectives in-house.

“Universities, which have long cooperated with tax-exempt, affiliated foundations to raise money for their athletics departments, should be wary of bringing collective-style NIL activities under their fundraising entity, lest it too falls like Al Capone to the IRS,” Cohen wrote. “Further, certain NIL collectives have been organized to primarily benefit student-athletes on certain teams. If that type of NIL favoritism were performed by an ‘in-house’ collective, it could constitute a violation of federal civil rights laws that require universities (and their closely affiliated entities) to provide gender equity in their payments incidental to athletic participation.”

Click here to read the full article from Cohen.

LEAD1 is the nation’s Division I Athletic Directors Association, click here to read the full report.