Navigating Sports Participation and NIL Disputes: Fair, Fast and Focused Solutions through Arbitration

by Lance K. Tanaka

As student-athletes gain new opportunities to monetize their name, image and likeness (NIL) rights, the landscape of college athletics is rapidly transforming. Alongside these new avenues come increasing complexities—and disputes—around eligibility, compensation, contracts and governance. Whether it’s a disagreement over a sponsorship deal or questions about an athlete’s eligibility, resolving these matters efficiently and fairly is more critical than ever. 

That’s where the American Arbitration Association^® (AAA^®) comes in. With a longstanding reputation for neutrality and expertise, the AAA provides a powerful alternative to litigation through arbitration and mediation—delivering clarity, speed and fairness for all parties involved.

This blog outlines the AAA’s dispute resolution process for sports participation and NIL cases, including its guidelines, supplemental procedures and cost considerations, to help stakeholders manage disputes effectively. 

Due Process: The Foundation of Fairness

At the heart of the AAA’s approach are its Due Process Guidelines, which were carefully crafted with input from leading legal scholars, sports industry leaders, athlete advocates and arbitrators. These guidelines are designed to protect the rights of student-athletes and provide procedural protections for all parties involved.

These guidelines establish:

• Procedural protections for student-athletes, allowing them a fair opportunity to present their case.
• Clear and consistent standards for arbitration proceedings.
• Transparency in decision-making, reinforcing confidence in the dispute resolution process.

In short, for these guidelines, fairness isn’t just a goal—it’s built into the system.

Common Sports Participation and NIL Disputes Handled Through ADR:

• Contract disputes between athletes, sponsors, agents and collectives
• Compensation disagreements over NIL agreements
• Endorsement, licensing and branding conflicts
• Breach of contract claims
• Eligibility and sports participation disputes involving schools, governing bodies and athletic organizations

Key Features of AAA’s Sports and NIL Arbitration

The AAA’s arbitration process is purpose-built for the fast-paced, high-stakes world of college sports. 

Expedited resolution is a top priority—cases are resolved quickly to minimize disruption to athletic seasons and careers. This timely process allows urgent matters, such as eligibility before a game, to be handled with the speed they require. 

Specialized arbitrators bring deep expertise to the table. Each dispute is decided by an arbitrator from the AAA’s exclusive Panel of Sports Arbitrators, professionals with substantial backgrounds in sports law, athlete eligibility issues and NIL contracts.

Privacy is paramount. The arbitration process protects sensitive financial and contract terms, offering privacy that traditional litigation often cannot. 

Supplemental Procedures Tailored for Sports and NIL Cases

AAA’s supplementary procedures go beyond standard arbitration practices, addressing the unique challenges of athletic disputes. 

Streamlined case management with simplified processes to help stakeholders resolve more efficiently.

Procedural flexibility is built in, allowing for adjustments that reflect the particular demands to accommodate the unique needs of collegiate athletic governance and NIL agreements.

In high-pressure situations—like determining eligibility just before a significant event—the AAA offers emergency relief options to deliver rapid decisions.

Cost Considerations for Sports Participation and NIL Arbitration

One of the major advantages of AAA arbitration is cost efficiency. While expenses vary based on complexity and the path the parties choose, the process is designed to be transparent and manageable. 

Key Cost Factors:

• Filing Fees: Fixed amounts are determined by the size and complexity of the dispute.
• Arbitrator Fees: Established rate that covers the arbitrator’s time and commitment to resolve the case.
• Administrative Costs: Clearly outlined and cover case management, scheduling and hearing arrangements, providing predictable administrative expenses for all parties.

Best Practices: How to Avoid Disputes in Sports Participation and NIL Agreements

Crafting a clear, comprehensive agreement from the start is the best defense against future disagreements. When it comes to sports participation and NIL arrangements, a thoughtfully constructed contract lays the foundation for long-term stability and mutual understanding between all parties involved.

Start by clearly defining compensation terms, including specific payment schedules.

Always include a dispute resolution clause designating AAA arbitration as the chosen ADR method—this sets expectations and simplifies conflict management. 

Ensure your agreement complies with NCAA, conference and state regulations, reducing the risk of legal or procedural issues.

Engage arbitrators with relevant expertise who understand the intricacies of both NIL rights and eligibility frameworks.

Finally, standardize your arbitration clause using the AAA’s recommended language so that any dispute will follow the streamlined Supplementary Procedures designed specifically for these kinds of cases. 

Sample Arbitration Clause for Sports Participation and NIL Agreements

For Sports Participation Programs:

“Any dispute, controversy or claim concerning an athlete’s eligibility, participation or governance within a sports organization shall be resolved by arbitration administered by the American Arbitration Association (AAA) in accordance with its Supplementary Procedures for the Arbitration of Sports Participation Disputes and Name, Image, and Likeness Disputes and the AAA Commercial Arbitration Rules.  The dispute shall be decided by an arbitrator selected from the AAA's Panel of Sports Arbitrators. Judgment on the arbitration award may be entered in any court having jurisdiction thereof."

For NIL Agreements:

"Any controversy or claim arising out of or relating to this Agreement shall be resolved by arbitration administered by the American Arbitration Association (AAA) in accordance with its Supplementary Procedures for the Arbitration of Sports Participation and Name, Image and Likeness Disputes and the AAA Commercial Arbitration Rules. The dispute shall be decided by an arbitrator selected from the AAA's Panel of Sports Arbitrators. Judgment on the arbitration award may be entered in any court having jurisdiction thereof."
By including these clauses, the parties will benefit from the AAA’s streamlined arbitration framework, which is designed to protect fairness and deliver results.

Conclusion: A Better Way Forward

As college athletics and NIL rights continue to evolve, efficient dispute resolution is more essential than ever. The AAA’s dispute resolution framework, reinforced by Due Process Guidelines crafted with input from leading legal and industry experts, provides fair, transparent and efficient resolutions for all stakeholders.

Ready to learn more or incorporate the AAA’s arbitration clause into your agreements? Visit adr.org for resources, sample clauses and support.