Name, Image, and Likeness (NIL) has completely changed the college athletic industry. In most states, excluding Texas, it has also changed the high school athletic industry (Texas government will likely change this in the near future).

Now that athletes have a chance to be compensated from other parties (usually businesses) to use their name, their image, or their other recognizable characteristics (likeness), many student athletes, parents, coaches, and athletic administrations have a plethora of legal issues to face.

While there are more than just four types of mistakes that I see when it comes to NIL contracts these tend to be the most common.

1. Blindly Executing a Contract

Contracts with businesses and other third parties, especially contracts that have been created by small business owners rather than lawyers, often have language that does not do exactly what the parties intend.

For example, a compensation clause that states, “The Company will compensate the athlete in an amount determined at Company’s sole discretion, based on the success of promotional efforts.”

An athlete might be thrilled to be receiving compensation just for making a social media post or signing an autograph. What the athlete may not know is that without expressly (in writing) defining what the compensation is, that athlete has agreed to any form of compensation and will be disappointed to have received $5 for the social media post they spent three hours on.

2. Violating School, NCAA, State, or Federal Regulations

Some universities have their own NIL guidelines and policies, which each athlete and third party should review prior to entering into an agreement.

On August 1, 2024, the NCAA created a rule allowing NIL activities, where before August 1, athletes would lose their eligibility status if they participated in NIL. The rule allowed athletes to receive compensation for their NIL activities. But the rule also creates a long list of NIL activity that is prohibited and if done, can result in being declared ineligible. For the list of prohibited NIL activities, see this link. Another great resource regarding these rules would be your school’s athletic compliance director.

On June 14, 2021, Texas passed an NIL law, then on June 10, 2023 Texas amended that NIL law to provide clarity. This law took effect on July 1, 2023. If an NIL contract does not follow the rules of Texas law, it will be declared void (as if it never happened). This is crucial to both athletes and third parties, because if one side does not like the contract, this will allow that side to terminate the contract. I have seen numerous contracts violate Texas law, the most common being, when the athlete fails to disclose the NIL deal to its university before entering into the contract.

While no federal law has been created for NIL as of March 2025, it is still possible to violate federal laws by entering into NIL deals. For example the Federal Trade Commission has a law that states specific things a social media influencer must do. If an athlete were to fail to follow this law, perhaps by failing to include language such as “ad” or “advertisement” that makes your financial relationship with the third party clear, the athlete could face punishments from the federal government.

3. Giving Up Too Much Control Over Your Brand

The most detrimental mistake to a student athlete and unfortunately the most common, is failing to understand how much control the athlete is giving the company over the athlete’s future. I do not blame athletes for not having the legal education to understand the contracts that third parties present them, and for many athletes, this is the first encounter they have had with endorsements, and they are eager to be able to use their NIL to make money. I was once a college athlete and would have signed a contract faster then athletes run when their coach says, “last sprint if you go hard,” if it meant I was getting paid to post on social media.

The problem with not knowing exactly what you are signing is that it leads you to  agreeing to mistakes, such as agreeing to an outrageous amount of social media posts, or agreeing to only post for a specific company, or even giving a company all of your NIL rights for your entire college career (meaning they could make deals with other companies using your NIL and you would have no say or receive any compensation).

This mistake is the primary reason to have an athletic compliance staff member, or preferably a lawyer review your NIL contract prior to signing. It may cost you a portion of the money that you make from the deal, but it will allow you to have complete control over your NIL and likely generate more income from future deals.

4. Not Maximizing Local Opportunities

It takes five minutes to sit down and write down all of your favorite businesses in which you use their products. Local coffee shops, mom and pop retail stores or restaurants, barber shops, and hundreds more. Take the time, write them down, then take the next step that many athletes fail to do, and draft a one-page letter telling the company how much you enjoy their product and would love to work together with them to generate more business for them using your NIL. Most local businesses in Tyler, Texas and many other cities have no idea what NIL is, and they think it is either Archie Manning (who they will not reach out to, because they know he would not respond) or nothing.

There are prime opportunities for athletes like the backup long snapper at Texas, or the point guard at UT Tyler to reach out to local business and begin their entrepreneurial career. It might lead to a few free tacos or maybe be the foundation to a million dollar idea, you never know until you take some sort of action.

Reach out to me to discuss NIL, whether you have a contract that needs reviewed, a contract that needs drafted, or just have questions on how all this works, I am always happy to talk NIL!