NIL (name, image, likeness)

NIL is the mechanism that has evolved in college sports whereby athletes can profit from their name, image, and likeness.  The exploding profitability of collegiate athletics led to a class action lawsuit against the NCAA.  In that lawsuit, a former UCLA basketball player (Ed O’Bannon) asserted that college athletes generated vast sums of revenue for big universities and video game companies that used the college players’ images in their video games. The bottom line is that athletes should be compensated for the use of their name and image in video games and elsewhere.

Eventually, ​​a California judge ordered the NCAA to pay $44.4 million in damages and another $1.5 million in costs to lawyers for the plaintiffs in the Ed O’Bannon class-action antitrust lawsuit. This case opened up the doors for more questions and lawsuits around athletes’ name, image, and likeness (“NIL”).

As of July 1, 2021, Texas became the fourteenth state to legally permit student athletes to profit on their name, image, and likeness. When a student’s NIL is used to promote or otherwise advance a commercial purpose, the athlete has a right to control such use and be paid for it.  The athlete should seek the help of an attorney to negotiate that use and the revenue generated. The Texas statute does not specify the extent of the athlete’s control and amount of compensation. That leaves it to schools and athletes to negotiate reasonable terms to compensate for the perceived commercial value of the NIL.

This Texas legislation is relatively new and has grabbed considerable media attention in the most recent college football season.  NIL deals have been announced for former Georgia quarterback Carson Beck and Texas quarterback Quinn Ewers.  But intellectual property law has long recognized and codified legal principles that protect the property rights of any person in their name, voice, signature, photograph, video, or likeness, (see The Lanham Act). This property right exists both during their lifetime and after death.

Texas law refers to someone’s NIL as the Right of Publicity, which in of itself is a transferable, descendible property right. Meaning that individuals have the right to enter into contractual agreements to sell or otherwise license their NIL and even to bequeath it to their heirs upon their death.

Texas Property Code Chapter 26 contains the most pertinent Texas statutory provisions governing NIL. The most recent judicial interpretations of the statute have extended NIL rights to apply for use in internet and social media commercial promotions and voiceovers.

The correct approach for a party intending to use NIL of an athlete (or anyone else) for commercial use would be to negotiate a written agreement, or contract, governing the purchase, licensing, and/or use of the NIL.

Popularity, notoriety, and fame cause the compensation for NIL to vary wildly from pennies to tens of millions of dollars.

Because of the money involved, every year numerous cases of NIL misappropriation occur. Misappropriation happens when someone’s NIL is used without their consent for the benefit of another. If you have reason to believe the someone has used your NIL without your consent, you may have grounds to file suit for Misappropriation of your Right of Publicity. To successfully recover for such a claim, it is not necessary to prove that the user actually made money off your NIL, only that their use of your NIL served some advantage to them, which could be financial profit or a host of other factors. In exceptional circumstances, or when one has been particularly harmed or objectively aggrieved by unauthorized use of their NIL, in addition to economic damages for lack of compensation for use of their NIL, non-economic damages for mental anguish may also be recoverable.

The ever more widespread accessibility and interconnectivity of multiple media platforms coupled with the bombardment of messages being permeated in the public sphere only makes NIL concerns ever more prominent. Internet celebrities, influencers, and content creators from all levels of society are finding themselves in situations where their NIL is already being utilized with or without their consent.

Going forward athletes and others should realize there is nothing more valuable than their own voice, likeness, and all the other tangible and intangible manifestations of self that NIL encompasses. Succinctly, NIL is the secret sauce that makes all of us uniquely identifiable in our own way. No one else should be benefiting from your indelible qualities and attributes without your consent. The attorneys at Marcum Ford P.C. stand ready to assist you to ensure that your statutory rights to control your NIL are fully protected.