Gervon Dexter sues to get out of 25 year NIL Deal.

[Sassy Squatch]

https://www.espn.com/college-footbal...l-violated-law

The NIL contract that Chicago Bears rookie Gervon Dexter signed with a speculative investment capital company while playing at the University of Florida in 2022 violated a state NIL law in place at the time, the Florida state legislator who sponsored the bill told ESPN on Tuesday.

Dexter, a second-round draft pick, agreed to pay Big League Advance Fund (BLA) 15% of his pre-tax NFL earnings for the next 25 years in exchange for a one-time payment of $436,485 in 2022, according to a copy of a federal lawsuit filed in the U.S. District Court in Gainesville, Florida, on Friday.

According to published reports, Dexter signed a four-year, $6.72 million contract with the Bears on June 16, meaning he would owe BLA about $1 million over the lifetime of that deal.

Florida Rep. Chip LaMarca, who proposed the initial legislation in 2020 that allowed college athletes in Florida to profit off their name, image and likeness, described Dexter's deal as a "predatory loan."

"The deals were supposed to be that an athlete could participate in the free market and when they graduate, whether they go on to play professionally or not, any future contracts are null and void," LaMarca said. "In other words, we didn't want someone having access to someone's future without them having proper guidance and proper representation."

The original Florida NIL law, Senate Bill 646, included the following provision: "The duration of a contract for representation of an intercollegiate athlete or compensation for the use of an intercollegiate athlete's name, image or likeness may not extend beyond her or his participation in an athletic program at a postsecondary educational institution."

[HC_Chief]

Originally Posted by dlphg9

Hey dipshit, the agreement was against the law. Also, we have to stop with thinking it's fine for companies to take advantage of people. It's why this country has gone to shit.

CJ is well within his right to miss whatever he wants. He's clearly not breaching his contract, because if he was they could just get out of it. Dipshit.


**** I hate everything about you and your ilk.

1. If it is against the law then it will be null and void, no? It currently is not null & void however, so you appear to be simply going by the word of one legislator (cherry-picking)

2. The flip side of that coin is individuals need to start taking responsibility for their actions and not play the "woe is little old me, I've been taken advantage of by THE MAN(tm)." Play stupid games, win stupid prizes.

3. CJ can hold out if he wants, accrue fines, and miss out on paychecks. This lessens his cap hit in 2023 and makes the possibility of tagging him at a substantially lower number in 24 much greater, also making him a real target for trade. It's his loss, financially. His holdout could very well negatively impact the team, thus fan ire. It's not rocket surgery.

4. You talk like someone who has never been punched in the ****ing mouth before.

[Hydrae]

Originally Posted by warpaint*

That did not read like a NIL agreement, it read like a loan. But I’m no expert.

That is where I am at. My understanding is that NIL is to allow players to be paid for allowing their Name, Image, or Likeness to be used for advertising purposes. The idea that they have to return some (or more in cases like this) of that investment to the company does not make any sense to me at all.

Please let me know where I am wrong here.

[HC_Chief]

Originally Posted by Hydrae

That is where I am at. My understanding is that NIL is to allow players to be paid for allowing their Name, Image, or Likeness to be used for advertising purposes. The idea that they have to return some (or more in cases like this) of that investment to the company does not make any sense to me at all.

Please let me know where I am wrong here.

There were two terms included in the agreement: an initial term that finished once Dexter's collegiate eligibility expired and an extended term that commenced when he left college.

In a questionnaire that was part of the agreement, Dexter initialed a section where he was asked if he agreed to give BLA 15% of his "future professional football earnings."

Oof. That second term is the killer.

[TwistedChief]

Originally Posted by ku_jhawk23

Hey dipshit....cj skipping out was not part of the contract. At will employment and a CONTRACT are not the same. Dexter was an adult when he signed his contract. It was a bad one...but tough shit. You sign, you are obligated.

The team signed Chris Jones to a contract and he has the right to not show up and not get paid. I'm sure there's an at-will employee clause in his contract that allows them to fire him and allows him to quit.

[BossChief]

Imagine you’re so stupid and unconfident in yourself that you agree to this kind of deal.

“Dexter, a second-round draft pick, agreed to pay Big League Advance Fund (BLA) 15% of his pre-tax NFL earnings for the next 25 years in exchange for a one-time payment of $436,485 in 2022, according to a copy of a federal lawsuit filed in the U.S. District Court in Gainesville, Florida, on Friday.”

[TwistedChief]

Originally Posted by HC_Chief

2. The flip side of that coin is individuals need to start taking responsibility for their actions and not play the "woe is little old me, I've been taken advantage of by THE MAN(tm)." Play stupid games, win stupid prizes.

Yeah, ultimately I agree with this. I think he was offered a really horrible deal and he accepted it. Obviously that doesn't make it illegal, but that also doesn't mean it's not predatory.

And personally, I'm inclined to be on the side of anti-predatory behavior rather than saying, "Well, it's not illegal and we're all big boys so..." Because that leads to a slippery slope where truly vulnerable people get taken advantage of.

[HC_Chief]

Originally Posted by TwistedChief

Yeah, ultimately I agree with this. I think he was offered a really horrible deal and he accepted it. Obviously that doesn't make it illegal, but that also doesn't mean it's not predatory.

And personally, I'm inclined to be on the side of anti-predatory behavior rather than saying, "Well, it's not illegal and we're all big boys so..." Because that leads to a slippery slope where truly vulnerable people get taken advantage of.

Yep, this looks like a really bad deal. Illustrates my original point: get someone to review the contract prior to signing! It's not expensive (couple hundred bucks) and can literally save you thousands (or millions, in this case).

IMO the NCAA should provide these kids support when entering in NIL agreements. That's crazy talk, though... we all know the NCAA is only good for ****ing things up, not actually being useful.

[DJ's left nut]

Originally Posted by DenverChief

I'm not a lawyer - but I stayed at a Holiday Inn Express last night

https://dockets.justia.com/docket/fl...cv00228/480720




https://www.law.cornell.edu/uscode/text/28/1332

Sure, Diversity jurisdiction applies pretty easily here.

But the 'citizenship' language you're citing applies only to the extent relevant to determine citizenship for the purposes of establishing diversity.

I don't doubt that the case can be filed in federal court - that doesn't settle the choice of law question, though.

I mean it sure looks like BLA is a sophisticated party. They've been doing this for a long time now and I have to believe they were well aware of the law when they offered the deal. And choice of law provisions typically stand up in court.

So you'd really need something of an end-run (or staggeringly inept practice from BLA) to establish that the terms are unconscionable or that it's some sort of odd contract of adhesion whereby the terms shouldn't be applied as against public policy.

I don't think Dexter has nearly the slam dunk case many of y'all seem to think he has. In fact, I'd rather argue Defendants side here without having actually seen the controlling document.

[TwistedChief]

Originally Posted by HC_Chief

Yep, this looks like a really bad deal. Illustrates my original point: get someone to review the contract prior to signing! It's not expensive (couple hundred bucks) and can literally save you thousands (or millions, in this case).

IMO the NCAA should provide these kids support when entering in NIL agreements. That's crazy talk, though... we all know the NCAA is only good for ****ing things up, not actually being useful.

Yeah. And I know we're saying that these are all adults, but we have no clue how much education these guys really have. And then suddenly someone is offering the guy 400k+ and he isn't exactly equipped to create an Excel spreadsheet to calculate his breakeven.

(He also had a kid in 2022 and maybe that played some role in the decision.)

[DJ's left nut]

Originally Posted by DenverChief

The article states the contract was signed when the law was already in effect. I'm assuming the lawsuit was filed in federal court because BLA is incorporated in another state while Dexter is a Florida citizen. There probably is a clause in the contract governing which state law applies. I'm assuming the argument is going come down on where was the contract communicated/executed.

I've had this exact argument before and lemme tell you, this becomes FAR more 'snake eating its own tail' than you could ever imagine in the days of multi-state and online lending.

Every state has a slightly different read on it. Some say it's where the notice was received, some say it's where it was sent from, some say it's where the payments are due, some apply a most significant contacts test. And then oftentimes states will point to the law of OTHER states and you'll end up in a death spiral where it truly cannot be conclusively established.

These are Gordian knot arguments on their best days. For instance, BLA has its principal place of operations in Virginia. It's incorporated in Delaware. Dexter's permanent residence appears to have been in Florida (he lived in Florida before he went to University of). Payments were probably forwarded to a payment processor and those are often, oddly enough, in Utah. It's not going to be terribly easy to untangle.

Ultimately I would argue it's a question of law rather than a question of fact so it SHOULD resolve on motion rather than any sort of trial. So it will probably move relatively quickly. I suspect BLA has a MX to Dismiss already punched up for these sorts of things and we'll see it on file in fairly short order.

[DJ's left nut]

Originally Posted by TwistedChief

First, interest rates are projected to go from the lows 5s to the mid 3s over the next 6yrs so assuming constant rates is flawed.

Second, but if you want to assume simplicity at current 5.25 spot rates, it takes you more like 13-14 years to double your money (rule of 72). For you to be right in terms of doubling your money over 6yrs, one would need to be receiving around 12% and there’s nothing remotely riskless that involves that return.

Third, that $430k is pre-tax. I think his effective federal tax rate (I’ll assume Florida so no state and local) would be about 31% which means he actually takes home a bit less than 300k of it. Meanwhile of course he’s paying out pre-tax income through the life of the deal.

Who said anything about 'riskless'?

I've already stated that this presents about a 14% ROI over the rookie deal. And while that's high, it's not unheard of and certainly not 'unconscionable'. The rest of it would be completely speculative.

And yes, the $430K is pre-tax - and? It came from BLA coffers that are post-tax in their own right. BLA's already paid the taxes on that money - why should they be taking on the burden of taxes again?

Again, I'm looking at this from BLA's chair because THAT'S the analysis that should be done. That's how you calculate their Rate of Return; not on how much of the money Dexter actually got. How much they SPENT is what's critical and they SPENT that $430K on Dexter instead of putting it into other investment vehicles.

[TwistedChief]

Originally Posted by DJ's left nut

Again, I'm looking at this from BLA's chair because THAT'S the analysis that should be done. That's how you calculate their Rate of Return; not on how much of the money Dexter actually got. .

I completely agree that's the right way to look at it from a business perspective. I read your post blurry-eyed and thought you were talking about how "I'm not shedding a tear for Dexter because he's just fine and can double his money in 6 years."

[Valiant]

Originally Posted by HC_Chief

Yep, this looks like a really bad deal. Illustrates my original point: get someone to review the contract prior to signing! It's not expensive (couple hundred bucks) and can literally save you thousands (or millions, in this case).

IMO the NCAA should provide these kids support when entering in NIL agreements. That's crazy talk, though... we all know the NCAA is only good for ****ing things up, not actually being useful.

I think NCAA should stay out of it. Let these kids make their own decisions.

If anything, all scholarships should be null and void after a certain point of money made from nil.

I would see about deferred payments or payments go to a trust.


One of the worst deals ever. Like government ****ing taxpayers bad.