Ili and Mirer v. NCAA: Enforcing NIL Limits Against State Law

Timeline

1. 2019California enacts the Fair Pay to Play Act, the first state NIL law.
2. Jan 17, 2025The Justice Department warns the House court that the settlement's cap fixes athlete pay.
3. Apr 7, 2025At the final approval hearing for the House settlement, the judge asks whether athletes could be bound to terms state law forbids, according to the complaint.
4. Jun 6, 2025The House settlement is approved; the Power Four launch the College Sports Commission as the designated enforcement entity.
5. Dec 3, 2025Attorneys general from seven states object to a proposed CSC participation agreement for schools, according to the complaint.
6. 2026The CSC rejects more than $7.5 million in NIL deals between Nebraska athletes and the school's multimedia-rights partner; challenges follow.
7. Jun 9, 2026Ili and Mirer file a proposed class action in the Northern District of California.
8. Sep 11, 2026The defendants move to dismiss; a hearing is set for Jan 28, 2027.

The ethical issues

• Whether a privately created enforcement body can lawfully cap athletes' earnings where state law forbids it.
• Whether the NIL clearinghouse is a legitimate anti-booster safeguard or a new form of wage suppression.
• Binding future athletes to a settlement they did not negotiate.
• Federalism: national rules versus state protections for athletes.
• Accountability of the individual leaders named as defendants.

Stakeholders

Stakeholder	Interests & obligations
Football and men's basketball players	Earning market-value NIL pay and having state-law protections respected.
College Sports Commission	Enforcing the cap and NIL rules uniformly so the post-House system holds.
NCAA and Power Four conferences	Stability, the settlement's protection from litigation, and national rules.
Schools in states with NIL laws	Complying with both state law and conference obligations.
Athletes in non-revenue sports	Whether a capped system protects resources for their programs.
State legislatures and attorneys general	Enforcing state NIL laws against national associations.

The case

The House v. NCAA settlement was supposed to end the era of lawsuits over athlete pay. It let schools pay athletes directly for the first time, up to a cap, and gave the biggest conferences a way to stop booster collectives from simply buying players. A year later, two California football players went to court arguing that the enforcement system built on that settlement had become the very thing antitrust law forbids: an agreement among competitors to hold down what they pay.

Background

When the settlement was approved on June 6, 2025, NCAA President Charlie Baker called it “a new beginning.” Schools could direct about $20.5 million to athletes in the first year, and the conferences would be responsible for “launching and enforcing a series of rules regarding the third-party NIL contracts student-athletes may enter into.” Baker also pointed to the settlement’s “release from future litigation on these subjects for the next decade.” He added that states “continue to undercut one another in a race to the bottom” and that “only Congress can address these issues.”^[4]

That same day, the Power Four conferences launched the College Sports Commission as the settlement’s designated enforcement entity.^[1] Its NIL Go clearinghouse, run with Deloitte, reviews third-party NIL deals above a threshold, set initially at $600 and later raised to $2,500.^[3] Deals with “associated” entities or individuals, such as collectives, large boosters or companies tied to a school, must show a “valid business purpose” and fall within a compensation range generated by Deloitte’s algorithm.^[2][1]

The rules and governance

The settlement’s injunctive terms permit, but do not require, schools to opt in to direct pay under the cap, and permit the conferences to restrict pay from associated third parties and to create an enforcement body.^[1] They did not override state law. California’s 2019 Fair Pay to Play Act says the NCAA and conferences “shall not prevent” athletes from earning NIL compensation or punish schools when athletes do. The complaint says 16 other states have similar laws.^[1] According to the complaint, Judge Claudia Wilken stated in approving the settlement that it “does not require that this Court find that the SA preempts state laws… nor is the Court making such a finding.”^[1] Federal policy has pulled the other way: an April 2026 executive order urged a ban on “fraudulent NIL schemes,” defined as payments above fair market value, including through collectives.^[7]

The lawsuit

On June 9, 2026, USC linebacker Talanoa Ili and Stanford quarterback Charlie Mirer filed a proposed class action in the Northern District of California.^[1][2] The defendants are the NCAA, the ACC, Big Ten, Big 12 and SEC, the CSC, and six individuals: Baker, the four Power Four commissioners and CSC chief executive Bryan Seeley.^[1] The proposed classes are football and men’s basketball players on full scholarships at schools in the 17 states with such laws, with separate California classes.^[1]

The complaint’s central claim is that the defendants knew state NIL laws had not been preempted, by Congress or by the court, yet agreed to enforce the cap and the third-party restrictions uniformly anyway. It alleges this is price-fixing, because it caps what athletes can be paid, and a group boycott, because conference membership and athlete eligibility are conditioned on compliance.^[1] It alleges claims under Section 1 of the Sherman Act, California’s Cartwright Act and the Fair Pay to Play Act, and for intentional interference with prospective economic advantage. The complaint denies that the restrictions are needed to stop “sham” deals or to preserve competitive balance.^[1] It cites the House approval hearing, at which, it says, the judge asked whether athletes could be bound to what state law forbids, and NCAA counsel replied that the NCAA could “deal with” any actual conflict.^[1] It also cites public statements by Baker and the commissioners that Congress would need to act.^[1]

The plaintiffs say they are not challenging the settlement, its terms or its continuation through 2035, only its implementation “in excess of its authorization.”^[1] They seek damages, a declaration that the defendants violated the Sherman Act, and an injunction against NIL restrictions that violate state law, including a suspension of NIL Go’s enforcement.^[2][3] The complaint also describes a “University Participation Agreement” that the CSC and conferences proposed in late 2025, which would have exposed schools to sanctions and limited their ability to sue. It says attorneys general from seven states objected in a December 3, 2025 letter, helping keep the agreement from taking effect.^[1]

A warning before approval

The argument at the center of the suit had been made before. On January 17, 2025, the Justice Department’s Antitrust Division filed a statement of interest in the House case. It argued that the settlement “allows the NCAA, an adjudicated monopsonist, to continue fixing the amount its member schools can pay students.” The higher cap was “still fixed by agreement among organizations that collectively control the entire labor market,” the Division said, and the settlement would “enshrine, for ten years, an agreement among competitors to limit compensation.”^[8] Quoting Justice Kavanaugh’s concurrence in NCAA v. Alston, it wrote: “Price-fixing labor is price-fixing labor.”^[8] It warned that the NCAA might use a court-approved settlement “as a shield against future antitrust actions.” It asked the court either to reject the settlement or to make clear that approval “is not a ruling on the legality of the Salary Cap Rule.”^[8] It also noted that salary caps in professional leagues are generally shielded from antitrust law because they are collectively bargained with unions. College athletes have no union.^[8][9]

Sportico’s legal analyst Michael McCann noted that the settlement resolved federal antitrust claims, not claims under state NIL statutes, and that Congress had not written it into federal law.^[9] The complaint makes this personal: Ili alleges that a USC-associated collective made him a “substantial multiyear offer” before the settlement was approved, and that it “disappeared” afterward. “Absent the NIL restrictions on direct pay NIL compensation,” the complaint argues, “Ili would have received more for his NIL rights than he now receives.”^[9]

The defense

Before any motion was filed, McCann predicted the defendants’ likely arguments.^[9] They might portray the suit as an impermissible attempt to unwind a court-approved framework. They might say it belongs before the settlement’s special master, Magistrate Judge Nathanael Cousins, or in the settlement’s neutral arbitration process, which athletes would arguably have to use first. They might also lean on Ninth Circuit precedent from O’Bannon v. NCAA that compensation beyond the cost of attendance must be “tethered to education,” and on the bargain itself: without the cap and other cost controls, the NCAA “would presumably not have accepted a deal.”^[9]

When the motion to dismiss came on September 11, 2026, it centered on release. According to an MLex summary, the NCAA argued that the plaintiffs could not obtain a court order allowing payments from schools and third parties beyond what the settlement permits, because they had released claims related to NCAA rules on payments to athletes.^[10]

Other pressure on the system

The suit was not the only challenge. Yahoo Sports reported that schools including Nebraska and Georgia had used the CSC’s built-in arbitration to contest rejected deals, and that House class counsel had accused the CSC of applying the clearinghouse too rigidly.^[2] After the CSC rejected more than $7.5 million in deals between Nebraska athletes and the school’s multimedia-rights partner, a magistrate judge ruled in July 2026 that such partners are not categorically outside the CSC’s oversight.^[5] Yahoo also noted that some may question the new complaint because settlement class members released antitrust claims and are bound by the settlement’s injunction.^[2]

Aftermath

All of the defendants joined in a motion to dismiss filed on September 11, 2026. A hearing is set for January 28, 2027, in San Jose.^[6] With the hearing months away, the motion was still pending in October 2026. The complaint’s allegations remain unproven.

The core dilemma

Is the College Sports Commission’s enforcement of pay caps and NIL rules a legitimate way to keep boosters from buying rosters and to preserve a broad college sports system, or is it a coordinated suppression of athletes’ earnings that disregards state laws written to protect those athletes?

Competing values

• Uniformity vs. federalism: National rules create a level field; state laws reflect democratic choices to protect athletes’ earning rights.
• Order vs. market freedom: Caps and review curb bidding wars; they also limit what athletes can earn.
• Finality vs. fairness to future athletes: Settlements bring peace by binding people, including athletes who were not yet in college when it was negotiated.
• Institutional authority vs. individual accountability: The suit names individual leaders, raising questions about personal responsibility for collective decisions.

Strongest arguments

For the plaintiffs: The settlement expressly did not preempt state law, and the defendants knew it; their own statements said only Congress could solve the conflict. Enforcing caps anyway, through an entity they created, is a horizontal agreement among competing buyers to suppress the price of athletes’ NIL rights, which is the kind of conduct antitrust law has long condemned.^[1]

For the defendants: The court approved a framework that included a cap, third-party NIL review and an enforcement body, and athletes in the settlement class released claims for a decade. Without consistent enforcement, booster-funded pay-for-play would swamp the cap, and the system meant to bring stability and protect broader programs would collapse.^[2][4]

Applying the frameworks

Justice & fairness (Rawls)

Behind a veil of ignorance, would you choose a capped system that spreads resources more evenly across schools and sports, or an open market that rewards the most valuable athletes? A Rawlsian might accept limits that benefit the least advantaged, but would ask whether football and basketball players, often from lower-income backgrounds, are the ones bearing the cost.

Rights-based

State NIL laws treat earning from one’s name and likeness as a right that associations may not restrict. From this view, a private body’s enforcement against that right needs strong justification. The defendants can claim their own rights: to associate, to set membership terms and to rely on a court-approved settlement. The case tests which claims should prevail.

Utilitarian

A utilitarian would weigh the benefits of a stable, capped system, such as competitive balance and protection of non-revenue sports, against lost earnings for top athletes, compliance costs and continuing litigation. The answer depends on facts not yet established in court, including how much NIL Go actually suppresses pay and whether removing it would lead to the collapse the defendants predict.

Walk it through: the Simple Decision Model

1. Spot the issue: Enforcement of NIL limits conflicts with state laws protecting athletes’ right to earn.
2. Gather facts: The settlement terms, the text of state laws, how NIL Go reviews deals, how much compensation is rejected, and who released which claims.
3. Test options: Continue uniform enforcement; exempt states with conflicting laws; seek federal legislation; renegotiate with athletes’ representatives; let courts decide.
4. Check codes and law: The settlement and its approval order, the Sherman Act, California’s Cartwright Act and Fair Pay to Play Act, other state NIL laws, and federal policy.
5. Decide and document: Explain the legal basis for enforcing in each state and publish the standards NIL Go applies.
6. Communicate and follow up: Give athletes clear guidance, track appeals and arbitration results, and adjust as courts rule.

What’s settled and what’s contested

• Settled: The House settlement was approved June 6, 2025, and did not find state law preempted; the CSC enforces the cap and third-party NIL rules; Ili and Mirer filed suit June 9, 2026; the defendants moved to dismiss September 11, 2026.^[1][4][6]
• Contested: whether enforcement in states with NIL laws violates antitrust and state law; whether class members’ releases bar the claims; whether NIL Go suppresses pay or prevents sham deals; whether the individual defendants are liable.

Why this case matters

College sports moved from banning pay to capping it. Whether that cap can be enforced by an entity the conferences created, in states that have outlawed such limits, will shape the economics of college sport. The case is a lesson in how settlements, state law and private governance interact, and in whether a new system of “order” serves the athletes it governs.

See also: NIL Go: Policing College Athletes’ Endorsement Deals.

Key terms

Myth of amateurism

The critique that athletes generate large revenues without the pay or labor protections other workers have. Tested by justice, consent and dignity.

Commercialization

The process of turning sport into a product and a business enterprise, with profit pressures that can compete with principle.

Institutional accountability

Structures that make a sport organization explain its decisions and face consequences: clear authority, transparency, appeals, independent oversight and enforcement.

Agency

An athlete’s ability to make decisions and act independently about their body, career and voice.

Distributive justice

Fairness in how scarce opportunities, resources, benefits and burdens are shared.

Stakeholders

Everyone with something at stake in a decision: athletes, coaches, parents, officials, fans, employees, sponsors, media, communities and regulators, including the less visible ones.

Definitions from the Ethics Cases glossary.

Discussion questions

1. Is a cap on what boosters and affiliated companies can pay athletes a reasonable guardrail or a restraint on athletes' earnings?
2. Should athletes who were not part of negotiating the House settlement be bound by its limits?
3. When state law and a national association's rules conflict, which should prevail, and who should decide?
4. Is it fair to name individual commissioners and the NCAA president as defendants? Why or why not?
5. Does the post-House system restore amateurism 'through the back door,' or is it a new model of capped pay?

Sources

1. Ili v. National Collegiate Athletic Association, No. 3:26-cv-05562, Class Action Complaint (June 9, 2026) — U.S. District Court, Northern District of California (via Berger Montague)
2. Class-action lawsuit filed against NCAA, power conferences and College Sports Commission over House settlement — Yahoo Sports
3. USC, Stanford football players allege 'conspiracy' in lawsuit against NCAA, power conferences, CSC — On3
4. A Letter from NCAA President Charlie Baker (June 6, 2025) — NCAA
5. College Sports' Search for Order Continues — Employment Law Lookout
6. Ili et al v. National Collegiate Athletic Association et al (docket) — PacerMonitor
7. Urgent National Action to Save College Sports (Executive Order 14400) — The White House
8. Statement of Interest of the United States, In re College Athlete NIL Litigation, No. 4:20-cv-03919-CW, ECF No. 595 (N.D. Cal. Jan. 17, 2025) — U.S. Department of Justice, Antitrust Division (via CourtListener)
9. House Settlement's NIL, Revenue Share Caps Face California Suit (June 10, 2026) — Sportico
10. NCAA moves to dismiss football players' US antitrust claims (Sept. 14, 2026) — MLex