Texas AG Ken Paxton Warns Universities: Do Not Sign College Sports Enforcement Settlement Agreement

Texas Attorney General Ken Paxton has issued a stark warning to public universities across the state: avoid signing a proposed settlement with a new college sports enforcement agency. This move could forfeit critical legal protections amid sweeping changes in NCAA athletics, including name, image, and likeness (NIL) rules and revenue-sharing models. Discover the full story, legal risks, and what Texas schools must consider next.

Introduction

In a letter dated November 26, 2024, Texas Attorney General Ken Paxton contacted leaders of 13 public Texas universities participating in major collegiate athletic conferences. His directive is clear: do not sign the “Joint Memorandum of Understanding” (MOU) with a newly proposed private enforcement organization for college sports. This entity aims to oversee compliance with emerging rules on athlete compensation, NIL deals, and revenue distribution following the landmark House v. NCAA settlement.

Paxton’s intervention highlights tensions between state sovereignty and the evolving landscape of college athletics. As Power Five conferences like the Big 12 and SEC push for standardized enforcement, Texas institutions face a pivotal choice. This guide breaks down the issue pedagogically, explaining key concepts like sovereign immunity and antitrust exemptions for beginners in college sports law.

Background on College Sports Reforms

The NCAA’s traditional amateurism model has crumbled under legal pressures. The 2021 Supreme Court ruling in NCAA v. Alston opened doors to NIL compensation, allowing athletes to profit from endorsements. Now, the $2.8 billion House v. NCAA class-action settlement introduces direct revenue sharing up to $20-22 million per school annually, reshaping Division I athletics.

Analysis

Paxton’s letters emphasize that signing the MOU would compel universities to submit to a private entity’s rulings without recourse to state courts. This new college sports enforcement agency, backed by conferences and the NCAA, would investigate violations such as improper NIL deals or booster inducements. Texas public universities, as arms of the state, enjoy sovereign immunity—a legal shield protecting them from private lawsuits unless waived.

By analyzing Paxton’s stance, we see a defense of state rights. The agreement allegedly requires schools to “waive any right to challenge” enforcement decisions, potentially exposing them to fines or sanctions enforceable only through arbitration. This shifts power from judicial oversight to a self-regulatory body, raising due process concerns under the Texas Constitution.

Key Stakeholders Involved

• Texas Universities: Institutions like the University of Texas at Austin, Texas A&M, and Texas Tech, all in major conferences.
• Enforcement Agency: A nonprofit formed by Division I conferences to handle infractions post-settlement.
• NCAA and Conferences: Pushing the MOU for uniform rules amid NIL chaos.

Summary

Texas AG Ken Paxton formally advised 13 public universities against signing a college sports enforcement settlement that risks waiving sovereign immunity and legal challenge rights. Dated November 26, 2024, the letters arrive as schools navigate the House v. NCAA aftermath, where new NIL and revenue-sharing rules demand robust enforcement. Paxton argues the private agency’s authority undermines state protections, urging caution to preserve judicial recourse.

Key Points

Practical Advice

For university administrators, athletes, and fans, here’s actionable guidance on navigating this college sports enforcement settlement issue.

For University Leaders

Review Paxton’s letter thoroughly and consult state attorneys general offices. Delay signing until legal opinions clarify sovereign immunity impacts. Implement internal NIL compliance programs to mitigate risks independently.

For College Athletes and NIL Agents

Understand that enforcement changes could scrutinize deals more rigorously. Use verified NIL collectives and disclose agreements promptly. Resources like the NCAA’s NIL portal provide templates for compliant contracts.

For Boosters and Fans

Support schools by funding compliant NIL opportunities through registered platforms. Avoid direct inducements, which could trigger investigations under new rules.

Points of Caution

While uniformity in college sports enforcement appeals to conferences, pitfalls abound for Texas universities.

• Loss of Judicial Review: Waiving challenges means no court oversight of potentially biased rulings.
• Financial Risks: Fines from the agency could strain athletic department budgets amid revenue-sharing mandates.
• State-Federal Tension: Conflicts with Texas laws prioritizing public institution protections.
• Precedent for Future Waivers: Signing now could normalize private oversight in other areas like Title IX.
• Athlete Impacts: Stricter enforcement might limit NIL opportunities if schools face penalties.

Comparison

How does Texas’s response stack up against other states?

Texas vs. Other Power Conference States

Vs. Historical NCAA Enforcement

Unlike the NCAA’s past infractions committee, which allowed appeals to arbitration or courts, this new agency centralizes power privately. Past cases like SMU’s 1987 “Death Penalty” involved public processes; today’s model prioritizes speed over transparency.

Legal Implications

Legal ramifications are profound and directly applicable. Texas public universities derive sovereign immunity from the Eleventh Amendment and Texas Government Code § 311.034, barring suits against the state without consent. Paxton contends the MOU constitutes an unauthorized waiver, potentially void under state law.

Antitrust and Federal Preemption

The House settlement grants NCAA a limited antitrust exemption, but states retain authority over public entities. Challenges could invoke the Contract Clause or Texas Administrative Procedure Act, requiring notice-and-comment for rule changes.

Potential Litigation Paths

If signed, universities might sue for declaratory judgment. Precedents like Texas v. NCAA (2023 NIL case) affirm state override of NCAA rules.

Conclusion

Texas Attorney General Ken Paxton’s warning underscores a critical juncture for college sports. By refusing to sign the college sports enforcement settlement, Texas universities safeguard sovereign immunity, due process, and state autonomy amid NCAA transformations. This stance not only protects public funds but sets a model for balancing athlete rights with institutional integrity. As NIL and revenue sharing evolve, stakeholders must prioritize verified compliance over hasty agreements. Stay informed as conferences respond and legal battles loom.

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