Are Schools Really Going After NIL Buyouts In College Sports? 'We Cannot Keep Taking It On The Chin'

How would you feel if, after donating a good amount of money towards an NIL collective for a particular player, that athlete then decided to take the money and transfer without playing a down? Now, imagine you're running an NIL collective where the sole purpose was to make sure the team you represent was paying enough to attain some of the top talent in college sports. 

As the college athletics world continues to change, with revenue-sharing on the way, and NIL contracts are being front-loaded so that they can stay off the books when the House settlement is approved, we are starting to see a small shift in how collectives could be going about their business. 

Right now, the most intriguing story centers around the Iamaleava family. One brother (Nico) left Tennessee as spring practice was ending, while the other brother (Madden) decided that he was ‘homesick’, so he followed his family to UCLA. So, you now have two different players in the SEC that signed NIL agreements with collectives, with money still on the table. 

What would you do in this situation? Let it slide, not go after the money that has already been paid for services still to be rendered, or go after the financial sum that's still left on a contract signed by all parties? In this current era of NIL and upcoming contracts that are negotiated with each school, we are at a crossroads when it comes to holding athletes accountable for the money that's been spent, or scheduled to be paid. 

Mind you, all of this comes with the job of being a college athlete. These are no longer just ‘kids’ on a scholarship, who used to be paid under the cover of darkness. It's time that schools stop acting like these men and women are student athletes, which I understand is hard to do without them being labeled ‘employees’. 

NIL Is A Business, Not A Charity. Parking Lot Deals Are In The Past

The days of getting the $500 handshakes or bags left at the high school field-house are over. Whether they want to say the important part out loud is up to the schools, but these athletes are now professionals, and it's time they started being treated that way. If you're being paid a few million per year to play for a school, while also doing your part to live up to the contract by appearing at events to sign autographs or getting out into the community to complete your ‘obligations’. This is a professional marketing deal, whether you like it or not. 

What we witnessed earlier this week from Arkansas athletic director Hunter Yurachek with his social media post about supporting the Razorbacks collective in their fight to recoup money from certain athletes was a test for public opinion. Yurachek knew that the ‘Edge’ collective was going after Madden Iamaleava for NIL money that had already been paid, along with what the company thought they could make off his name, image and likeness during his contract period. 

And, judging by the reaction on social media, it looks as though the school will have plenty of support in their quest to recoup some of that money. But, the reason why so many schools have not gone after players for breaking an agreement is based off the reaction they could receive from future recruits or transfer portal prospects. 

"If we put our marketing budget together, after already paying an athlete a few hundred-thousand dollars, and the athlete decides to leave after not even playing a snap, wouldn’t you try to recoup some of that money?" one NIL collective representative told OutKick. "Think about all the money we've spent on merchandise, events, their apartment, vehicle and monthly salary."

Does every school have buyout language in their contracts? No. But there are plenty of collectives in college sports that have included this type of writing in case a player decides to bolt after cashing a few checks and heading off into the abyss, also known as the transfer portal. If these schools are going to spend massive amounts of money on a player, only to then see them leave four or five months later, it's reasonable to think that they would like to get some of the money back. 

This is a business, and return on investment is a gamble many are willing to take in hopes of a player reaching their full potential. Does it always work out? Absolutely not. But again, that's the risk you take by agreeing to pay players an exorbitant amount of money to play for the school you represent. 

Do These NIL Collectives Have A Case When Trying To Recoup Money?

All the chatter around players being held to their contracts, or having to pay a buyout if they plan on leaving one school for another is a part of this chapter that comes down to language. 

Sure, there are plenty of NIL collectives that include buyout language in the deals they present to potential clients. But, there are also counter-offers that would force the collective to either agree to the terms or move on to the next player. 

The problem with these contracts is that there is a gray area about what's actually enforceable. Obviously, these athletes are being paid to play sports, as the marketing aspect of this is just a small equation in the entire situation. Sure, players are asked to appear at events, show up for fundraisers, shake hands and smile at the boosters that are helping finance these contracts. 

But, how else are the collectives supposed to actually make enough money to prove that it was worth the negotiated amount that the player was paid?

"We cannot just keep taking it on the chin because the public might have a differing opinion. I'm sorry, but I am running a business, and I have boosters who want a return on investment, in the form of wins," another NIL collective rep told OutKick. So, when that person who donates a lot of money on a yearly basis then sees a player enter the portal without contributing much on the field, if any, I can't just tell them that we struck out. Sure, it's a gamble. 

"But we have to start holding them to their signature, and if it doesn't legally hold up, then we did a poor job putting the contract together. I'm not implying everyone has this type of language with a buyout included."

FAYETTEVILLE, ARKANSAS - OCTOBER 05: Head Coach Josh Heupel talks with Nico Iamaleava #8 of the Tennessee Volunteers on the sidelines during a game against the Arkansas Razorbacks at Donald W. Reynolds Razorback Stadium on October 05, 2024 in Fayetteville, Arkansas. The Razorbacks defeated the Volunteers 19-14.  (Photo by Wesley Hitt/Getty Images)

Do you think showing up once every two months for a Boys & Girls club appearance is enough? A majority of the time, these athletes show up for an hour, sign a few autographs and go on their way. Obviously, this is just one example, but I think you understand where I'm going here. 

If the two sides agree to a deal, and one side doesn't live up to their promises, it's pretty easy to understand why these companies would go after potential future financial losses. 

If a player decides after being on campus for a few months that they want to explore their options, after already being paid a decent amount of money, it's not an easy pill for these NIL collectives to swallow.