• Loading stock data...
Thursday, June 26, 2025
Front Office Sports Launches Front Office Sports Studios Learn More

NIL Contract Buyouts Are More Common, but Can They Be Enforced?

In the pros, as well as with college coaches, buyouts are paid by the team or school the player transfers to. But in the NIL era, they work differently.

Dec 27, 2024; Memphis, TN, USA; Arkansas Razorbacks defensive back Miguel Mitchell (16) returns an interception during the forth quarter against the Texas Tech Red Raiders at Simmons Bank Liberty Stadium.
Petre Thomas-Imagn Images

On Tuesday, Arkansas quarterback Madden Iamaleava—the brother of new UCLA quarterback Nico Iamaleava—entered the transfer portal, presumably to join his brother in Westwood. 

Hours later, Arkansas athletic director Hunter Yuracheck released a statement expressing his “support” for NIL collective Arkansas Edge’s “pursuit to enforce their rights under any agreement violated by our student-athletes moving forward.” 

The statement was taken by many as a thinly veiled threat to Madden, who arrived in Fayetteville just a few months ago after decommitting from UCLA himself. He hadn’t played a down of regular-season football with Arkansas but had inked an NIL contract with Arkansas Edge.

In some ways, the speculation was correct: Madden is one of several athletes who have violated the terms of Arkansas Edge contracts by transferring before his contract was set to expire, prompting the collective to try to enforce a “buyout” clause, a source familiar with the situation tells Front Office Sports. The collective has since issued two demand letters to players to pay buyouts, the source said—though the source declined to confirm that Madden was one of them.

Arkansas isn’t the only collective seeking redress. Multiple sources told FOS that collectives are increasingly trying to recoup revenue from players who are utilizing new NCAA rules, which let athletes transfer as many times as they wish without penalty. “Buyouts are fairly common, especially with high-value athletes,” Russell White, president of The Collective Association, tells FOS. “They are now being included in more agreements.”

The key question is whether buyouts are  enforceable.

In the pros, as well as with college coaches, buyouts are paid by the team or school the player transfers to. But in the NIL era, they work differently. 

Usually, a collective will include a buyout clause requiring the player to either pay or return a certain amount of money to the collective if the player violates the terms of the agreement—usually if they leave schools before the lifetime of the contract ends, and therefore can’t complete all the requisite NIL activities. At Arkansas, for example, deals span one year, and buyouts require players to pay an amount equal to 50% of the remaining earnings through the lifetime of the contract, the source says. 

The enforceability of the contract, however, depends partially on the language of the deal, sports lawyers tell FOS. Attorney Darren Heitner, who represents dozens of college athletes, says that buyouts framed as “penalties” are often less enforceable legally than buyouts framed as “damages.”

“I’m not willing to generalize and state that all buyouts are unenforceable,” Heitner says. “However, on the rare occasion that there has been a claim for repayment for one of my clients, that has been my conclusion based on the language of the agreement at issue as well as the specific facts of the situation at hand.”

Attorney Mit Winter notes that the price of requested damages could matter, too. “The collective would need to be able to tell a court or an arbitrator that by no longer being able to use the athlete’s NIL rights, it will be damaged in some non-speculative amount. That could be hard for some collectives to do.”

Heitner says none of his clients have had to pay buyouts to date. Winter says that, to his knowledge, “not that many” collectives have been able to successfully collect buyouts. 

But success is in the eyes of the beholder. The source familiar with the Arkansas situation says collectives don’t always receive the full amount, but the buyout clause itself brings players and their representation to the table to negotiate some restitution. (While there have been disputes across the industry, White says, most have been resolved behind closed doors.) 

The next step for the industry: to see how a buyout clause fares in court. 

For now, one thing is clear: Collectives are no longer accepting being left high and dry in the era of unrestricted free agency.

Linkedin
Whatsapp
Copy Link
Link Copied
Link Copied

What to Read

Mar 23, 2025; Raleigh, NC, USA; Baylor Bears guard Jeremy Roach (3) reacts after a play during the first half against the Duke Blue Devils in the second round of the NCAA Tournament at Lenovo Center.

Power Four Put Finishing Touches on How Revenue Sharing Era Will Work

The agreement stipulates that schools can’t sue to challenge any terms of the settlement.
Faith Kipyegon

Nike’s Sub-4:00 Stunt Falls Short With Fastest Women’s Mile Ever

Male pacers and cutting-edge tech helped Kipyegon shave off one second.
Bristol, CT - October 3, 2023 - Studio X: Kevin Negandhi on the set of SportsCenter.

From NBA Draft to Rubik’s Championship: Negandhi’s Whirlwind Summer With ESPN

Negandhi recently anchored the NBA draft lottery and NBA draft.

Featured Today

Jun 17, 2025; Sunrise, Florida, USA; Florida Panthers center Sam Reinhart (13) hoists the Stanley Cup after winning game six of the 2025 Stanley Cup Final against the Edmonton Oilers at Amerant Bank Arena

Stanley Cup’s International Summer Tour: Rules, Repairs, and Raucousness

No pro trophy tour compares to the NHL’s three-month global victory lap.
Mar 15, 2025; Fort Worth, TX, USA; UAB Blazers forward Yaxel Lendeborg (3) dribbles the ball upcourt against the North Texas Mean Green during the first half at Dickies Arena
June 22, 2025

NIL Is Shrinking the Pool of NBA Draft Entrants

Agents are now advising many players to stay in school.
Apr 24, 2025; Green Bay, WI, USA; Penn State Nittany Lions defensive end Abdul Carter on the red carpet before the 2025 NFL Draft at Lambeau Field
June 21, 2025

‘More Is More’: The Elite Luxury Jewelers Decking Out Athletes

Meet the elite group of luxury designers crafting the biggest statement pieces.
Dec 5, 2024; Miami, FL, USA; FIFA president Gianni Infantino presents the FIFA Club World Cup trophy during the Club Word Cup draw at Telemundo Studios.
June 15, 2025

Revamped Club World Cup Is FIFA’s Billion-Dollar Gamble

The revamped soccer event debuts amid controversy.

Pac-12 Rebuild Nears Completion With 2026 Texas State Addition

The Sun Belt school is likely joining the Pac-12 in 2026.
Jun 7, 2025; Chapel Hill, NC, USA; North Carolina infielder Jackson Van De Brake (6) and outfielder Carter French (18) celebrate an out during the first inning of the Super Regionals game against Arizona in Chapel Hill, North Carolina.
June 25, 2025

Most Power Conference Sports Won’t See Revenue-Sharing Dollars

But there is a silver lining for Olympic sports: more scholarships.
Sep 16, 2023; Stanford, California, USA; Sacramento State Hornets running back Elijah Tau-Tolliver (25) celebrates after a touchdown during the fourth quarter against the Stanford Cardinal at Stanford Stadium.
June 25, 2025

Sacramento State ‘Full Steam Ahead’ for FBS Despite Not Receiving NCAA Waiver

The Hornets launched a public campaign to join the FBS last fall.
Sponsored

Hottest Matchups Following NFL Schedule Release

The NFL released the 2025 regular-season schedule, and anticipation is already building in the ticket marketplace with four months to go.
June 23, 2025

Colleges Are Raising Student Fees to Pay for Athlete Revenue-Sharing

Schools are preparing to pay student athletes up to $20.5 million annually.
Dec 27, 2024; San Diego, CA, USA; The Washington State Cougars ban perform during the second half at the Holiday Bowl at Snapdragon Stadium. Mandatory Credit:
June 23, 2025

Pac-12 Announces CBS As ‘Anchor’ in New Media-Rights Deal

The league may announce expansion before finalizing the rest of the package.
Wisconsin cornerback Xavier Lucas (6) is shown during the first quarter of their game against South Dakota Saturday, September 7 , 2024 at Camp Randall Stadium in Madison, Wisconsin.
June 20, 2025

Wisconsin Sues Miami for ‘Tampering’ With Football Transfer

Xavier Lucas signed NIL deals in Madison before transferring to Miami.
June 19, 2025

Omaha Delivers Again: LSU, Coastal Carolina Set for CWS Showdown

LSU and Coastal Carolina begin their three-game series Saturday.