Legal Memo Reports | The Legal Edge: NIL
November 19, 2025
A Quick Welcome
Welcome to the Legal Memo Reports. This week's analysis addresses the single greatest operational fear universities have about the shift to an employee model: the floodgates opening to wrongful termination lawsuits over roster cuts.
This memo breaks down the legal firewall professional leagues use to manage this risk, the Collective Bargaining Agreement (CBA), and outlines the necessary modifications required to adapt this powerful legal defense to the unique mission of college sports.
Sincerely,
Rebekah Ballard, 3L
[IMPORTANT NOTICE]: This newsletter provides general educational insights. Please see the full legal Disclaimer at the bottom of this email before acting on any information.
Article 1
The Invisible Barrier: Why Courts Won't Hear Athletes' Lawsuits Over Roster Cuts
When a professional athlete is cut or not selected, it looks like a simple employment issue. Yet, unlike a typical employee, that player cannot usually sue the team for wrongful termination in public court. This is not due to a special law for sports, but a powerful legal firewall built by leagues and teams.
Crucial Context for College Sports: This entire framework of employment lawsuits, arbitration, and legal firewalls only matters if college athletes become legally classified as employees. Under the current amateur model, employment suits over roster decisions are largely irrelevant.
Players who sue try to use two main legal avenues to bypass the private system:
Discrimination/Retaliation: Claiming the cut was based on a protected characteristic (like race or age) or retaliation for reporting misconduct.
Employee Status: Lawsuits, common in minor leagues, arguing for minimum wage and overtime under the FLSA.
Despite these efforts, the leagues successfully enforce a private justice system.
The Core Defense: The CBA and Labor Preemption
The foundation of the legal firewall is the Collective Bargaining Agreement (CBA) between the league and the Players' Union. This single document dictates all employment terms.
Labor Law Preemption: This federal doctrine is the crucial tool. When a player files a lawsuit, the league argues that the claim requires interpretation of the CBA. The court is then obligated to dismiss the case and defer to the private process agreed upon in the CBA. The courts themselves—federal and state—enforce the private system, refusing to hear the merits of the roster dispute.
Mandatory Arbitration: The CBA mandates that all disputes be resolved through binding arbitration, not court. This keeps the rationale for roster cuts private and away from judicial review.
The Price of the Private System: The "Repeat Player" Concern
The arbitration system relies on Neutral Arbitrators—highly paid experts jointly selected by the league and the union. However, this structure creates a significant concern: the "repeat player" bias.
The league is a permanent, high-volume client ("repeat player") that constantly hires these arbitrators, while an individual player is a one-time customer. This puts a financial incentive on the arbitrator to avoid rulings that are consistently hostile to the league, securing their selection for future cases.
Ultimately, the professional sports model is a highly effective, closed legal system where employment disputes are resolved swiftly behind closed doors.
Article 2
The College Solution: How a Modified CBA Can Protect Athletes and Teams
If college athletes are ruled employees (or a variation of it), universities face a unique legal dilemma: how to manage roster decisions without opening the floodgates to employment lawsuits. The answer lies in adapting the professional model's legal defense mechanism—the Collective Bargaining Agreement (CBA)—with modifications tailored for education.
The New Roster Risk
In an employee model, every cut or non-selection decision risks becoming an employment lawsuit. Athletes could claim:
Wrongful Termination: Challenging the cut as lacking "just cause."
Employment Discrimination: Claiming the denial of a spot was based on race, gender, or disability (Title VII).
To preempt this, universities must establish a Student-Athlete Association (SAA) to negotiate a CBA.
Building the Legal Guardrails
The CBA provides the university’s necessary legal firewall: Labor Law Preemption. But unlike the professional model, the college CBA must incorporate strong welfare and academic guardrails to truly separate the athlete from the student:
Mitigating Bias: To eliminate the professional system's "repeat player" bias, arbitrators must be funded and selected by an independent, neutral foundation (or the SAA)—not the university administration.
Academic Priority: Cuts related purely to academic standing are explicitly exempt from arbitration. This legally separates the academic requirement, ensuring the student role cannot be challenged via the employment system.
"Just Cause" Metrics: Athletic cuts require the university to demonstrate "just cause"—meaning clear, documented, objective performance metrics. This shields the university from successful discrimination claims by proving the decision was based on performance, not bias.
Injury Guarantee: The CBA guarantees full funding for the duration of the employment period if the athlete is cut due to a career-ending injury.
The move to an employee model doesn't have to signal the end of college sports. By adopting the professional legal mechanism (CBA + Arbitration) and adding these robust guardrails, the sport and academics are equally important, but legally separate, missions. This protects the university's operations while providing equitable rights and security to the athletes.
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Disclaimer: This newsletter provides educational insights and general information related to the legal side of Name, Image, and Likeness (NIL). It does not constitute legal, financial, or professional advice, and should not be relied upon as such. This content is for informational purposes only, and you should always consult with a qualified professionals for advice tailored to your specific situation.
NIL laws are constantly evolving, and the information provided might not be the most current at all times.