Welcome to a special week of the Redshirt Diaries presented by Cedarbrook Golf Course as I attempt to break down and make sense of all this House vs NCAA settlement stuff. In just the last 36 hours there have been so many developments to get caught up on and I will attempt to break down two specific areas today:
1) The first lawsuit/legal challenge since the settlement was final
2) The private equity stuff
With that being said, happy U.S. Open week and let's get started:
* Well, this one is one we all saw coming a mile away: Eight female athletes have filed a
lawsuit based on Title IX and contend that the settlement violates the law. It should be noted that this one is by former athletes who are challenging the "damages" part of the settlement (monies paid to former athletes from 2016 until now for NIL losses) and not the overall settlement. So the back payments are on hold until this is resolved but the payroll/revenue share part of it is still on target for July 1. This, however, is not a surprise and I will be willing to bet that once the revenue sharing is announced by each individual athletic department, there will be more challenges to that. In other words, Pitt is going to take the full $20.5 million. If it gives, say, $18 million to football and men's basketball and then splits the other $2.5 million between all the other sports, I think there will be a legal challenge. Now, the people who have agreed to the settlement and the judge who wrote the decision seem to think that these attempts at a lawsuit or injunction or legal challenge will ultimately fail. Again, I have written it many times but so many administrative types have told me the same thing "Title IX is about opportunity and not about revenue" And while I agree to a paint the reality is courts have consistently sided with equality and equity. I think this first lawsuit will be a huge test case as to just how capable the settlement will be to stand up to the Title IX law. The best case for the NCAA is this lawsuit fails because it would put a real cramp in any of these other Title IX attempts. If this one wins, however, my God the floodgates will open.
This to me is the money graph from Rakesh Kilaru, one of the NCAA's bulldog attorneys....
"Judge Wilken wrote a really thorough order -- 76 pages," Kilaru told CBS Sports. "I think she addressed all the issues really persuasively. It's somewhat notable that this was actually not an issue that we even argued at the final approval hearing because I think typically, when you're challenging back damages, your kind of logical remedy is to opt out of the settlement and not be bound by it, as opposed to challenging it.
"But with all of that said, the ultimate question that the appeals court is going to handle is not just whether Judge Wilken got it right or wrong, but actually whether she did what's called 'abusing her discretion' in approving the settlement. And really what that means is she gets a lot of deference in the decision she made. So I think we feel confident that when we present our arguments to the court that the settlement approval will be upheld."
This tells me two things - the judge made sure to cross all the Ts and dot all the Is before she put her stamp of approval on this thing. And the second thing is that the judge had a lot of leeway to make oversee and approve this settlement and it is not going to be easy to overturn much, if any, of it no matter how much huffing and puffing the lawyers and agents do when it comes to challenging this stuff.
Bringing it closer to home to Pitt, I do believe there will be some Title IX implications that will be considered in all of this. Upper administration still has enough of the "we want to be an Ivy League school with big time athletics" types that there is a push to make sure the $20.5 is distributed a little more evenly than at some schools. I don't think that it will be significant because again football and men's basketball will get the lion's share of the money but there will be a push to break off more than many places for volleyball and women's basketball. I am really interested to see what the number is when it is all said and done but Pitt is capable of making it very hard on itself to compete in the two main revenue sports.
* Now let's talk about this private equity nonsense. You all read the stories about Penn State and UCLA taking money from Elevate's college sports fund, which is backed by The fund is backed by private equity firm Velocity Capital Management and the Texas Permanent School Fund, a special-purpose government corporation that supports the state’s schools. Do you remember this? Yeah, it took all of about 12 hours for both Penn State and UCLA to deny it was
them that were the two schools (allegedly) that took the money. Both Penn State and UCLA claim that Elevate is their partner for "ticketing strategy and operations" and they have nothing to do with the private equity fund. They claim that they are partners with Elevate for ticketing strategy and operations but not for any kind of private equity. Penn State is an interesting case because even though they appear to be one of the school's flush with cash, they have had to tighten their belts a little bit and they have added a number of fees, donations and other ways to squeeze donors and season ticket holders this spring. Everyone is trying to find new revenue streams and private equity seems to be all the rage.....
But it appears the "Private Equity" craze has died down significantly. It would be great for schools like Pitt, that need money, to link up with one of these private equity firms and watch the money roll in but here is what has happened: schools and leagues have figured out that private equity and nonprofit are not a match made in heaven. North Carolina was one school all in on jumping in bed with one of these private equity firms until North Carolina realized that their goals did not align with the goals of a firm that exists for one reason and one reason only: to make money. Private equity firms want a return on their investment and they want to be shown that there is going to be a return. One administrator type from one of the school said it best "private equity is not going to want to invest in Olympic Sports, they want to make sure their money is in sports that make money." Well, duh. It isn't just the schools though that have slowed down the private equity craze, it has also been the firms as they have figured out college athletics
are probably a bad or losing investment.
As for Pitt, there probably isn't a lifeline here because again, private equity firms aren't in love with lots of red ink. This is a development, though, we should all watch because I do believe there will be some things worked out so that these kinds of investments make sense but right now it is a lot more talk and wishful thinking than anything else.
* I hope you enjoy these breakdowns as this is a huge story to digest. Tomorrow I will look at the Hail Mary thrown by the NCAA to congress and break down what all of this stuff might mean for Pitt. By the way, if any of you ever want to get together and play a round of golf at Cedarbrook with me drop me an email at
paulzeise@yahoo.com and I will make it happen.