On Jul 02 2021 by Nigel D. James

Moving the Goalposts: Name, Image, and Likeness Compensation for Foreign Student Athletes

Foreign student athletes are at the starting line on recent changes to name, image, and likeness (NIL) compensation for student athletes. As a novel area for federal immigration law, the rules for what is acceptable or unacceptable are completely undeveloped, but some general principles may help F-1 student athletes take advantage of NIL compensation opportunities without endangering their immigration status.

The Warmup

The National Collegiate Athletic Association (NCAA) has continuously resisted student athletes receiving compensation for others’ use of their name, image, or likeness. Name, image, or likeness refers to a person’s ability to attain profits on their publicity from third-party endorsements, such as by receiving compensation through sponsorship posts on social media or appearing in video games. On June 21, 2021, the Supreme Court issued a decision in National Collegiate Athletic Association v. Alston invalidating the NCAA’s restrictions on the amount schools can pay student athletes for education-related benefits, while also placing a question mark on the NCAA’s ability to limit compensation to student athletes in other areas. On July 1, 2021, several states – including Florida, Georgia, Illinois, and Texas – will have laws going into effect allowing for student athletes to receive compensation for their name, image, or likeness, with more states to follow later this year. Although the NCAA has yet to officially change its bylaws, the organization issued an interim policy on June 30, 2021, allowing student athletes the opportunity to participate in NIL agreements regardless of state, but largely placing the burden on universities to determine how to proceed.

In the Red Zone

For foreign student athletes, abiding by the terms of a nonimmigrant visa is critical. For certain nonimmigrant visa categories, such as F-1 or J-1, the applicable rules allow foreign student athletes to obtain work authorization, but only if the employment is permissible under the regulations. Notably, employment generally refers to an exchange of compensation for services, with compensation taking the form of money, clothing, or other benefits. Accepting any kind of compensation for services can result in a violation of status if done without work authorization. Violations of status can also occur if work is performed outside the regulations provided for the specific visa category. The consequences of unauthorized work could be immediate – such as through the cancellation of the nonimmigrant visa – or could be years later when an individual is denied the ability to change to a different nonimmigrant status or adjust their status to receive permanent residency or citizenship.

The hurdle now for F-1 student athletes is determining which name, image, or likeness arrangements may or may not be considered unauthorized “employment” under federal immigration law. This includes analyzing factors like the terms of the agreement; the permitted work capacity as defined in their respective nonimmigrant visa category; state, federal, and NCAA rules.

The Referees

As of this writing, the Department of Homeland Security (DHS) has not provided clear guidance on the impact of name, image, and likeness agreements for foreign student athletes; however, on June 21, 2021, the Student and Exchange Visitor Program (SEVP) delivered the following message to stakeholders:

The Student and Exchange Visitor Program (SEVP) is aware of and actively monitoring proposed federal and state legislation pertaining to the use of name, image and likeness for student athletes including F and M nonimmigrant students. The program is working with its partners within the U.S. Department of Homeland Security to review how this legislation affects international student athletes and will provide updated guidance via Broadcast Messages, Study in the States, social media and SEVP field representatives.

Since there is no clear guidance, students will have to navigate this area on their own for the moment.

Driving the Lane

F-1 student athletes should consider their level of involvement in receiving compensation for their name, image, or likeness. Involvement may be acceptable when more passive, such as in Bhakta v. Immigration & Naturalization Service, 667 F. 2d 771 (9th Cir. 1981), where a foreign national was deemed to not have engaged in unauthorized employment when he was receiving profits through the ownership of a motel, and not actively engaging in a business. On the other hand, it may cross the line when the foreign national is more active, such as in Wettasinghe v. U.S. Department of Justice, 702 F.2d 641 (6th Cir. 1983), where an F-1 student was deemed to have engaged in unauthorized employment through the purchasing of ice cream and ice cream trucks, leasing to vendors to sell, and assisting as needed. Nonetheless, there are zero cases directly addressing name, image, and likeness arrangements in the context of federal immigration law.

A wave of student athletes have already initiated NIL agreements as of July 1, 2021, including deals to be the public faces of certain companies, promotions on social media, and to play video games with fans. Take for example identical twins Hanna and Haley Cavinder who play basketball at Fresno State and signed a sponsorship deal with Boost Mobile. Sponsorship opportunities where student athletes receive compensation for promoting the company through posting on social media sites, such as Hanna Cavinder’s post on Instagram, leans towards active involvement and employment. On the other hand, a more passive arrangement would be a company like Boost Mobile asking a student athlete to use their image on the company’s social media for a single post to promote a new product, where the student athlete receives compensation for a one-time deal and is not involved in the posting process.

Similarly, Jordan Bohannon, a point guard with the Iowa Hawkeyes, launched his own apparel line, J3O; and D’Eriq King, a quarterback at the University of Miami, launched his own website selling apparel and signed memorabilia. These both would heavily lean towards active involvement in the creation and direct management of a product and appear as self-employment, which is a violation of status for F-1 and J-1 visa holders. A more passive arrangement would be for a student athlete to own a website or product line and receive income from generated sales but have a management team that runs the day-to-day and not be involved in active business decisions.

Of course, all name, image, and likeness arrangements for foreign student athletes should be evaluated on a case-by-case basis, including foreign student athletes with work authorization through their nonimmigrant status.

The Post-Game Review

It will be important for DHS to provide clarification as unauthorized and authorized employment in the context of name, image, and likeness compensation is currently a grey area. Even with the release of guidance from DHS, F-1 student athletes should review any potential name, image, or likeness engagements with relevant university officials and immigration counsel. After all, it is always better to take a timeout and strategize with the team before attempting any game-altering performances. 

 

The material contained in this article does not constitute direct legal advice and is for informational purposes only.  An attorney-client relationship is not presumed or intended by receipt or review of this presentation.  The information provided should never replace informed counsel when specific immigration-related guidance is needed.

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