IndyBar: Getting Paid as a High School Athlete

By Chris Roberts, Woodard Emhardt Henry Reeves & Wagner LLP

The “amateur” sports landscape has fundamentally changed due to athletes’ newfound ability to earn money for their name, image, and likeness (NIL). This comes as a welcomed change by the athletes, while some fans and organizations remain cautious. On one hand, many fear the changes the new policies may bring to our beloved sports. On the other hand, “amateur” sports is a multibillion-dollar industry and the decision to finally allow athletes to cash in for their contributions is one step toward rectifying one of America’s most glaringly inequitable industries.

The trend of players getting paid has extended from college athletes to high schoolers in most states. However, high schoolers in some states should exercise restraint because accepting money could cost them and their team. Indiana happens to be such a state.

Even in situations where athletes are eligible, organizations and athletes alike would do well to seek competent legal counsel in navigating the complex world of NIL and the related legal issues.

Variance Among States

The majority of states (about 40) have aligned with the NCAA in allowing NIL for high schoolers. These states have varying frameworks, ranging from the so called “unrestricted” states; to heavily restricted states; to “gray area” states where the legality of NIL is up for debate.

What this means in practice thus far is that the college NIL market has simply extended to high school. Some colleges pay monthly installments to players committed to play at their school, simply for remaining committed. This also means that some athletes are flocking to the less-restrictive states, with some earning millions before playing in college. Some states, such as Iowa, place strict caps on players’ earnings, the type of sponsorships permitted, and forbid athletes from using the IP of their school. Others forbid NIL for public schools but not private schools.

Finally, on the other end of the spectrum, some states are taking the wait-and-see approach to observe the effects that the change brings to the NCAA and NIL-friendly states. Indiana is one of five states that currently prohibits paying high schoolers for their athletic endeavors.

Navigating Complex Legal Issues

The good news is that the IHSAA provides relatively detailed guidance. Although, as the IHSAA states, there is no “all-inclusive answer” as to what constitutes a violation, the bylaws provide dozens of situation-specific answers. For example, athletes are permitted to get paid for providing instruction at camps if the compensation is “commensurate” (R5-3); are permitted to keep equipment up to a value of $250 (Q5-11); and may be “sponsored” for lodging/meals at eligible events (Q5-10). Other areas are murky – such as whether an athlete may begin to seek compensation after their respective sport finishes but before they graduate. The IHSAA appears willing to provide guidance to athletes who are willing to ask and specifically includes in its definition of acceptable awards those that are “approved”. Thus, when in doubt, ask the IHSAA beforehand.

There are other legal issues to keep in mind besides simply the NIL of the athlete. In some situations, the IP of the athlete and the school or organization need to be carefully parsed out. Strict attention should be paid to Indiana’s right of publicity statute and its exceptions (See Ind. Code § 32-36-1-8(a); and Daniels v. FanDuel, Inc., 109 N.E.3d 390, 392 (Ind. 2018)). Athletes and organizations would be wise to consult attorneys who operate in this space – specifically attorneys with expertise in intellectual property. Many issues surrounding NIL are fundamentally rooted in intellectual property law, as they involve the use and protection of an athlete’s name, image, and likeness as valuable assets. Experts in intellectual property can also provide guidance on relevant copyright, trademark, and state laws that affect athletes and organizations.

Preparing for the Future

Athletes earning money at the high school level across the country seems likely, if not inevitable. It will be imperative for athletes and organizations to be prepared when such a change occurs in Indiana. In such an evolving landscape, it is wise to seek legal counsel to make sure proper agreements are in place, athletes and organization’s rights are protected, and that federal and state laws are not being violated.•

Chris Roberts is an attorney with Woodard Emhardt Henry Reeves & Wagner LLP. His practice focuses primarily on intellectual property litigation. In addition to litigation, he guides clients through intellectual property portfolio management, including trademark registration, domain name acquisitions, drafting patent applications, prosecuting patent applications, post-grant proceedings. Roberts obtained his undergraduate degree from Marian University and his J.D. from the Indiana University Maurer School of Law. He is an active member of the Indianapolis Bar Association, serving on the Young Lawyers Division Executive Committee. He’s also a graduate of Bar Leader Series Class XXI.