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The Yow Plan: Universities Sanctioned by the NCAA Should Sue Agents who broke NCAA Rules

By Rick Karcher, Michael McCann, Geoffrey Rapp, Greg Skidmore, and Howard Wasserman

The new Athletic Director of N.C. State, Debbie Yow, has a message for agents who intend to break NCAA recruiting rules while on the N.C. campus: if you do, and the NCAA punishes us with sanctions, we'll be suing you. Ken Tysiac of the News and Observer has the story, which is excerpted below.

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. . . Yow said the letter will warn agents that if they violate the law while dealing with N.C. State athletes, the school will sue them. "I'm going to protect N.C. State University from any agent abuse," Yow said.

North Carolina's Uniform Athlete Agent Act requires agents to register with the state and refrain from promising anything of value to athletes while they're in school.

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Violations of the law are a Class I felony in North Carolina. The law allows a civil fine of up to $25,000, but ACC commissioner John Swofford would like unscrupulous agents to face more substantial penalties.

Yow hopes the potential of a lawsuit that could extract greater damages will be an additional deterrent. The Uniform Athlete Agents Acts in North Carolina and Maryland specifically mention that an educational institution can seek damages, including lawyers' fees, from an agent (or former athlete) who injures the school.

It's difficult, however, to assign a potential dollar amount for those damages in court. It's conceivable that serious NCAA violations could, for example, force a school to give back hundreds of thousands of dollars in NCAA tournament money. If a school is banned from bowl participation, violations could cost a school more than $1 million.

But legal experts say it would be difficult to hold an agent responsible for such large amounts, because such serious penalties usually are levied only when a lack of institutional control on the part of the school accompanies the violations.

"You're going to have this question about whether the harm was caused by the action [of the agent] or by the failure of the institution effectively to control," said Paul Haagen, a Duke professor and co-director of the university's Center for Sports Law and Policy. "There would be a contributory negligence kind of thing there. That would be a difficulty [in court]."

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Vermont Law School professor Michael McCann said there's a public relations advantage, though, in sending the letter, even if it doesn't have a big legal impact.

"Is it a good idea to send a letter?" said McCann, who specializes in sports law. "In some ways it's a deterrent. It also shows that the school cares."

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Two Additional Thoughts:

1) As raised by ESPN's Seth Wickersham in a Facebook conversation: "It seems like she put her own coaches on notice as well, right? I mean, a lot could come out in a possible court case, if it ever went that far." I agree with Seth. If NC State were to sue an agent for damages resulting from an NCAA sanction, the NCAA States coaches who breached NCAA rules would be subject to the discovery process and possibly have to testify.

2) Another form of sanction for unscrupulous agents is for the Players' Associations that license the agents to sanction them, including through a suspension or license forfeiture. That type of sanction, though, would not directly benefit a university sanctioned by the NCAA.

Full post as published by Sports Law Blog on August 07, 2010 (boomark / email).