The first wave of post-House name, image, and likeness (NIL) enforcement disputes is beginning to produce written decisions, and a recent arbitration involving 18 Nebraska football players and Playfly Sports Properties offers the earliest substantive looks at how the College Sports Commission (CSC) is approaching its clearinghouse role. In that decision, the arbitrator upheld the CSC’s refusal to clear the deals at issue, concluded that the CSC properly treated Playfly as an “associated entity,” and determined that the deals should not be cleared.
For schools, student-athletes, agents, multimedia-rights partners (MMR), and brands, the decision is worth reading less for its bottom-line result than for what it reveals about the CSC’s enforcement theories.
Whether Playfly Counts as an “Associated Entity”
The threshold issue was whether Playfly qualified as an “associated entity.” If the answer were no, the parties agreed the deals had to be cleared. But once Playfly was treated as an associated entity, the deals became subject to the NCAA’s more demanding “valid business purpose” and “rates and terms” scrutiny.
The CSC viewed the deals differently—as arrangements where Playfly was functioning as a pass-through for university-linked funds. The CSC pointed to the correlation between Playfly’s obligation under its MMR arrangement to invest $8 million in NIL and the roughly $7.5 million in aggregated NIL deals at issue, argued that any unspent NIL funds reverted to the University, and emphasized the extent of Playfly’s operational integration with Nebraska, including embedded employees and close collaboration with the athletic department. The CSC also argued that the University had identified Playfly as an associated entity in prior reporting.
School-Linked Funding and Recruiting Concerns
The CSC also framed the deals as implicating recruiting and retention concerns. The CSC argued that NIL was presented alongside Nebraska’s own revenue-sharing commitments as part of a student-athlete’s overall compensation package, and it pointed to a relocation provision allowing Playfly to terminate if an athlete failed to maintain a residence near the University as evidence the structure was aimed, at least in part, at discouraging transfer-portal movement.
How Playfly's Rights Model Worked
The more distinctive part of the opinion may be its treatment of Playfly's deal structure. The arbitrator described Playfly’s model as one in which Playfly acquired NIL rights and held them as inventory for future sale to third-party sponsors, even though the agreements did not identify the eventual sponsors, the timing of activation, or the specific goods or services ultimately to be promoted. The opinion emphasized that there was no guarantee Playfly would ever sell all of the rights it acquired or that any particular student-athlete would actually perform for an identified sponsor.
That structure mattered in two ways:
- First, the arbitrator agreed with the CSC that the deals failed the “warehousing” rule because they lacked the kind of direct activation and reasonable specificity that the rule requires for associated-entity deals. In the arbitrator’s view, acquiring NIL rights now for possible future use, when most advantageous to Playfly, fit the very concern the warehousing rule was designed to address.
- Second, the same structure informed the valid-business-purpose analysis. The arbitrator concluded that the record did not show Playfly itself was offering goods or services to the general public or using the athletes’ NIL to promote Playfly’s own business in any direct-to-consumer sense. Instead, Playfly was acquiring rights for possible resale to future sponsors who, if identified later, might then promote goods or services to the public. On the record before him, the arbitrator found that this was too attenuated to satisfy the rule.
How the CSC Evaluated Compensation
The decision also provides an early look at the CSC’s rates-and-terms (R&T) arguments, as well as some quiet but pointed skepticism about the CSC’s tools. The CSC relied on a Range of Compensation (RoC) framework designed by Deloitte Consulting and argued the Nebraska deals reflected likely overcompensation in the 25–30% range. But the arbitrator noted a structural problem that may recur: the Deloitte model excludes cleared associated deals from its comparator pool entirely by design, on the theory that associated deals may not reflect arm’s-length market behavior. The arbitrator was not convinced that logic holds. If cleared associated deals have already been vetted as non-pay-for-play, they may be the most apt comparators for other associated deals—not the least. On top of that, the secondary review tools—the Player Portfolio Test (PPT) and Sponsor Comparable Test (SCT)—had almost no traction here: none of the 18 deals could be evaluated under the SCT, and only two qualified for the PPT. As the arbitrator put it: the secondary review tools “are not yet reasonably effective due to a lack of comparators.” The arbitrator declined to find the deals cleared on R&T but also declined to endorse the model. It will be worth watching whether future decisions start to give these secondary tools more credence as more comparators arise.
Unresolved Issues in the Decision
Just as important are the questions the decision leaves unresolved. Most notably, the opinion is silent on the separate “deal facilitator” issue that has surfaced in other CSC disputes. The arbitrator focused on whether Playfly was an associated entity and whether the deals satisfied the associated-deal rules. He did not address whether the presence of an affiliated deal facilitator, standing alone, changes the level of CSC scrutiny or otherwise alters the analysis.
For now, that issue remains open.
That silence matters because Class Counsel in House has separately asked the court to rein in what it characterizes as CSC overreach. In an April 2026 motion to enforce the settlement, Class Counsel asked the court to declare that MMR companies are not “Associated Entities or Individuals,” and that third-party brand sponsors are not associated entities merely because a school helped arrange the deal. The motion argues that the settlement preserved only a narrow category of heightened review and that the CSC has been extending that review too far. That hearing is currently scheduled for May 27, 2026.
Implications for the NIL Marketplace
So where does that leave the NIL marketplace? At a minimum, this first decision suggests that the CSC and its arbitrators may look closely at deal structure, not just deal amount. Where an MMR partner is deeply integrated with a school, where funds appear tied to school-side economics, or where NIL rights are being acquired for unspecified future activation, the associated-entity, warehousing, and valid-business-purpose rules may become central very quickly. At the same time, broader questions about the outer bounds of CSC authority—especially as to MMR partners, facilitators, and brand sponsors—remain unsettled and may ultimately be shaped as much by the ongoing House enforcement proceedings as by the arbitration process itself.
The Playfly–Nebraska decision is less a final map than an early field report. It offers the clearest picture yet of the CSC’s current concerns, but it does not resolve several of the biggest structural questions that schools, student-athletes, and commercial partners are still asking.
If you have questions about the PlayFly–Nebraska decision, please contact a member of Miller Nash’s Sports, Entertainment & Media team.
This article is provided for informational purposes only—it does not constitute legal advice and does not create an attorney-client relationship between the firm and the reader. Readers should consult legal counsel before taking action relating to the subject matter of this article.
