Report: EA, CLC to pay $40M in settlement with collegiate athletes

Electronic Arts and the Collegiate Licensing Company will pay approximately $40 million in their settlement with college football and basketball players in their long-running player likeness lawsuit, report ESPN and the New York Times.

The parties filed a notice in federal court yesterday to say they reached a settlement, but terms of the agreement were to remain confidential until the full proposal had been presented to the court. Citing a "source familiar with the negotiations," ESPN reports the settlement is for $40 million. Michael Hausfeld of law firm Hausfeld LLP, co-lead counsel representing the players, confirmed the amount to the New York Times.

EA and the CLC — which handles licensing for most of the schools that appear in EA's college sports titles — were named as defendants, along with the NCAA, in a number of lawsuits filed by student athletes. The suits charged that the three companies illegally profited off the use of the players' likenesses in video games and other media without compensating the athletes. The NCAA is not participating in this settlement; a representative for the organization told USA Today on Thursday that it is prepared to take the case to the Supreme Court.

According to ESPN, under the terms of the settlement, EA will not admit any wrongdoing. The same applied to the publisher's settlement in a previous antitrust case regarding the price of its football games.

the division of the settlement funds remains unclear

It remains unclear how the settlement funds will be allocated. Since the lawsuit covers NCAA Football and NCAA Basketball games from EA Sports dating back to 2003 — including current student-athletes — somewhere between 200,000 and 300,000 players are eligible for a payout from the settlement, according to Steve Berman, managing partner at law firm Hagens Berman Sobol Shapiro LLP and co-lead counsel for the athletes. But the money may not be split evenly among the athletes, since some players were represented visually in the games as avatars while others appeared only as entries in rosters.

Representatives for Hagens Berman, EA and the CLC declined comment to Polygon for this story.

Shortly before news of the settlement agreement broke yesterday afternoon, EA announced it would not publish a college football title in 2014, leaving this year's NCAA Football 14 as the final entry in the series for the foreseeable future.

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