Does NIL guidance impact BLVD, South Carolina's 'in-house agency'?
The University of Southern California and University of South Carolina, two universities which share the same acronym but are located on opposite coasts, were on the forefront of NIL-related partnerships with third-party media and sports management agencies this summer.
However, after the NCAA Division I Board of Directors approved last week additional clarifications to the NCAA’s interim NIL policy, which label it impermissible for third-party entities to represent athletes on behalf of an athletic department, only a few individuals involved in those agreements have been willing to answer questions publicly on whether they’re affected.
USC announced in June that it reached an agreement with the media agency Stay Doubted, which created a Trojans-specific subsidiary called BLVD that has seven full-time employees. South Carolina announced in August a two-year, $2.2-million agreement with Everett Sports Marketing (ESM) that created an “in-house agency for all NIL activities” called Park Ave.
USC’s press release said the agreement offered “unprecedented NIL support.” The Twitter account for South Carolina’s football program posted, “We just changed the NIL game.”
Those who responded to requests for comment from On3 maintained the two schools’ agreements are in line with the NCAA’s interim NIL policy.
Sports attorney Heitner: ‘Neither of those entities are at issue’
The NCAA’s recent clarifications said it’s impermissible for, “Any individual or entity acting on behalf of the athletics department (e.g., third party rights holders, third party agents) representing enrolled [student-athletes] for NIL deals, including securing and negotiating deals on behalf of the [student-athlete].”
“Neither of those entities are at issue with regards to this bullet point,” Darren Heitner, a sports and IP attorney, said in a recent phone interview with On3.
Following the release of the NCAA’s latest clarifications, Heitner tweeted, “Having served as legal counsel for BLVD and Park Ave, and with insight into how they work, I maintain they are each in alignment with the guidance.”
Heitner stressed to On3 for a third-party entity to be in violation of the NCAA’s latest clarifications, an entity must both act on behalf of an athletic department and represent enrolled athletes at the school.
He said neither BLVD nor Park Ave do both.
“We have received and are currently reviewing the new NCAA guidelines on NIL activities,” a South Carolina spokesperson wrote in an email to On3. “The University of South Carolina is committed to NIL activities that offer the best educational and business opportunities for our student-athletes. Since the announcement of our NIL partnerships, we have been pleased with the NIL opportunities our student-athletes have been able to take part in.
“The University of South Carolina intends to move forward with current Gamecock NIL initiatives while consulting with appropriate partners regarding any adjustments if needed.”
Representatives for ESM and USC declined to comment to On3. An NCAA spokesperson said in an email that the NCAA can’t comment on specific agreements.
South Carolina’s NIL contract with ESM has ‘not been fully executed’
Many observers who follow changes in the NIL landscape wondered if the NCAA’s latest clarifications would impact South Carolina, USC or the third-party entities with whom they’ve reached agreements. The curiosity, if not concern, was fueled by the lack of clarity as to the terms of each school’s agreement, leaving each school’s initial press release and subsequent tweets as primary sources of information.
USC is a private institution, which means it’s not subject to the California Public Records Act.
While South Carolina is a public university, its contract with ESM is not yet publicly available, months after it announced the agreement.
Around 8:30 a.m. ET last Wednesday, a Freedom of Information Act (FOIA) coordinator at the University of South Carolina told On3 in an email the university’s contract with ESM “has still not been fully executed.” Roughly five hours later, coincidentally, the NCAA Division I Board of Directors announced the latest clarifications to its interim NIL policy.
Heitner said Friday afternoon there have not been any potential issues with the contract that have been brought to his attention following the NCAA’s clarifications to its interim NIL policy.
Mixed messages around Park Ave’s NIL services at South Carolina
The NCAA’s recent clarifications stated that it’s impermissible for an entity that acts on behalf of the athletic department to represent enrolled athletes for NIL deals, “including securing and negotiating deals.”
The first sentence of South Carolina’s press release that announced its partnership with ESM said “negotiation assistance” is among the services to which its athletes will receive access. The Twitter account for Park Ave, the in-house agency ESM established for South Carolina athletes, announced on Twitter in mid-October that in its first 45 days in operation, the in-house agency procured 117 marketing deals.
Heitner said he doesn’t pay much attention to press releases, adding that he doesn’t know who drafted or distributed South Carolina’s press release. He said he didn’t have any involvement or provide any guidance regarding the tweet, adding that he thinks the word “procured” could be interpreted in many different ways.
“What I can tell you is Park Avenue does not represent any enrolled student-athletes — SAs — for NIL deals,” Heitner said.
A graphic from Park Ave says, “University of South Carolina student-athletes get the top marketing firm in the country repping them for FREE and NON-EXCLUSIVELY.”
Park Ave was involved in South Carolina forward and former On3 Consensus five-star recruit GG Jackson signing an NIL deal with the trading card company Topps. And the agency appeared to deliver a team-wide NIL deal was for the South Carolina football team with SAXX Underwear.
“Park Ave is a consultant for the university so while it may be interpreted that it is an entity acting on behalf of the athletic department, what’s important is if you read the whole sentence in its entirety, it continues to say, ‘representing enrolled SAs for NIL deals,’ and Park Ave does not represent any athlete at South Carolina,” Heitner said.
He said BLVD doesn’t act on behalf of the USC athletic department, either.
Stay Doubted founder and CEO Michael Jones tweeted last week that “BLVD is not paid by USC and the current structure is still in alignment with this new guidance.”
Could the clarifications impact multimedia rights holders?
Given the NCAA’s unwillingness or inability to comment on specific agreements between a member institution and a third-party entity, its recent clarifications still don’t provide total clarity.
If South Carolina and USC’s respective agreements with Park Ave and BLVD are permissible, as their representatives have argued, then are any schools or third-party entities’ current NIL infrastructures at risk?
In another tweet, Jones wrote, in part, “They are not targeting entities like BLVD.”
The same bullet point in question from the NCAA’s clarifications says third-party rights holders also can’t act on behalf of an athletic department and represent enrolled athletes. Were recent developments between universities and companies that own multimedia rights (MMR) the inspiration for that specific clarification from the NCAA?
The college athletics media and technology company LEARFIELD announced in August team-wide NIL deals between the Oklahoma State softball team and Seth Wadley’s dealerships in Perry, Oklahoma.
“The new sponsorship agreement and NIL component with Seth Wadley’s dealerships was secured on behalf of the University by its athletics multimedia rights holder, LEARFIELD’s Cowboy Sports Properties,” a press release stated.
In Nebraska‘s recent multimedia rights contract with the sports marketing and media company Playfly, Playfly will reportedly contribute $2.25 million to Nebraska or a third party to support NIL initiatives over the 15-year contract term, according to The Athletic’s Mitch Sherman.
Questions will remain, however, about the motive and impact of the NCAA’s latest guidance, unless and until the NCAA clarifies its clarifications.