Tennessee NIL law takes aim at House settlement terms, provides protection from antitrust lawsuits

Earlier this month, Tennessee Gov. Bill Lee signed S.B. 536 into law. Considered one of the most athlete-friendly NIL laws in the country, it takes aim at key terms of the House v. NCAA settlement and also provides schools protection from antitrust lawsuits.

Under the law, which took effect May 1, athletes at Tennessee schools will be able to receive dollars from collectives unless told otherwise by federal law, a valid court order or antitrust laws. In addition, it says the NCAA cannot “create anticompetitive restrictions that lessen, or tend to lessen, full and free competition in trade or commerce affecting this State or to otherwise violate state and federal law.”

The law also protects schools in Tennessee and the state from legal disputes. It states the NCAA shall not “establish, adopt, promulgate, implement, or enforce any rule, standard, procedure, policy, or guideline that violates an applicable state or federal antitrust law,” and it should make sure it’s “legally exempt from applicable antitrust laws” before doing so.

Tennessee now has the most athlete friendly NIL law.

It appears to prohibit all of the House settlement’s limits on NIL comp (salary cap, collective restrictions, etc.) unless they’re part of a federal law, valid court order, or determined to be exempt from antitrust law. pic.twitter.com/7o0QTQBGMi

— Mit Winter (@WinterSportsLaw) May 16, 2025

“An institution’s athletic association shall not create or impose unfair, anticompetitive, or unlawful conditions that directly or indirectly compel an institution or intercollegiate athlete to participate under such conditions or risk violating state or federal law, regardless of whether a choice or option is made available by the association,” the law states. “The availability of a choice, vote, authorization, or mitigation attempt of any kind does not absolve or relieve the athletic association of its obligations under subdivision (b)(3) or this subdivision (b)(4). The requirements of subdivision (b)(3) and this subdivision (b)(4) apply irrespective of a party’s participation in such conditions.

“The athletic association shall fully indemnify and hold harmless the state, its institutions, and intercollegiate athletes from any damages, losses, claims, or remedies of any kind arising from its noncompliance or failure under such applicable law. Any violation of subdivision (b )(3) is unenforceable against institutions and intercollegiate athletes without penalty, loss, or fault.”

Where House settlement approval stands

If fully approved, the House v. NCAA settlement would usher in the revenue-sharing era in college athletics. Schools will be able to directly share up to $20.5 million with athletes through the first year of the 10-year agreement. A clearinghouse would also go into effect that would require disclosure of NIL deals worth more than $600.

Roster limits are one of the biggest pieces of the settlement, though. They have also been a point of contention throughout the final approval process after Wilken expressed concern for athletes currently on rosters during a hearing last month. She told both the plaintiffs and defendants to go back to the drawing board and consider grandfathering spots.

After the updated brief didn’t include those provisions, Wilken said she would deny final approval if the plaintiffs and defendants could agree on verbiage to protect impacted athletes. That filling came last week at the two-week deadline to file as the two sides agreed to give schools the option to grandfather those roster spots.

The deadline for objections was Wednesday, and Friday was the deadline for responses. Now, the wait is on for a decision from Wilken.