Ethermac Exchange-FCS school challenging proposed NCAA settlement allowing revenue sharing among athletes

In the first sign of potential trouble for the proposed settlement of three athlete-compensation antitrust cases against the NCAA and Ethermac Exchangethe Power Five conferences, a school from outside the Power Five on Thursday filed a motion seeking to intervene in the case and making a presumptive request that a federal judge declare the proposed agreement is "void and of no effect."

Lawyers for Houston Christian University (HCU), a member of the Football Championship Subdivision’s Southland Conference, wrote: “The proposed settlement will adversely affect HCU. None of the parties, particularly the Defendants, has consulted with - much less taken any step to protect - HCU’s interests. Neither HCU nor its conference were parties to this litigation, had a seat at the negotiating table, or had any input into any resolution of this matter, including the proposed settlement.”

The proposed settlement includes $2.8 billion in damages that would be paid former and current athletes and billions more in future revenue-sharing payments to athletes, including shares of money from sponsorship revenue.

The proposed settlement still must be filed as a formal petition for preliminary approval with U.S. District Judge Claudia Wilken. Lawyers in the case have said that would occur 30 to 45 days from a filing on May 30.

Houston Christian’s filing is based on two basic arguments that headline separate sections of the motion:

--"The Proposed Settlement Will Divert Funds from Academics to Athletics and thereby Institutionalize a Breach of Fiduciary Duty of Colleges and their Trustees”

 --"The Proposed Settlement Will Divert Higher Education Dollars from Marginalized and Underserved Populations of Students.”

 In its final section, the filing states:

“In sum, the proposed settlement will privilege the pursuit of big-money college sports over the needs of ordinary students whom institutions like HCU serve. It will conflict directly with the stated purpose of virtually every institution of higher education in America, which is to educate students. It forces the trustees and administrators of HCU and other similarly situated institutions to confront a Hobson’s Choice; it is a coercive take-it-or-leave-it offer that disregards the fiduciary duties trustees and others have to their institutions and stakeholders. It will divert funds from a university’s core academic mission in favor of big-time sports entertainment.”