Jock Trap

Scandals involving unscrupulous sports agents are prompting states to standardize laws for the industry.

State Representative Gerald Allen still vividly remembers the August afternoon seven years ago when the glory of his beloved University of Alabama football team was irrevocably sullied. As he sat in a country restaurant and watched in disbelief, the National Collegiate Athletic Association announced that it was putting his alma mater on probation- -taking away the Crimson Tide's scholarships and changing eight victories into losses. The reason for the punishment: a star cornerback had played for the school for a full season after receiving money from a sports agent.

When the probation was handed out, Alabama had won 12 national championships without a single blemish on its record. To Allen, who grew up near the campus in Tuscaloosa and also watched his son play football there, it seemed impossible that one sports agent could cause such a storied program to crumble. "I thought, something is wrong with this picture," he says. "Something is missing here."

As a freshman legislator in 1995, Allen became one of the first to study laws about sports agents, requesting legislation from all of the states with laws on the books. He discovered that during the 1980s, Alabama and a few other states had passed laws regulating sports agents in response to their growing influence following the start of free agency. But enforcement of such laws was sporadic at best.

Today, states are well on their way to stopping unscrupulous sports agents, and making life significantly easier for legitimate agents. The solution comes in the form of the Uniform Athlete Agents Act, which sets the same requirements for agents across the country. With essentially no opposition, 14 states have currently adopted the law and legislation is pending in an additional eight states.

Although agents' primary role is to negotiate contracts and endorsement deals, they also will do everything from coordinating volunteer opportunities to teaching young players "life skills" to get them from college to professional life. Under NCAA rules, agents are allowed to talk to athletes at any time, as long as there is no agreement for future representation. The second an athlete agrees to be represented, or accepts a gift of any kind, that athlete is no longer eligible to play college sports.

If an athlete plays, and is later shown to be retroactively ineligible--as was the case in Alabama--the school can be sanctioned with a costly punishment. In 1996, for example, Marcus Camby led the University of Massachusetts basketball team to the Final Four. When it was later revealed that Camby had accepted clothes, cars and stereo equipment from agents, the school had to return $151,000 to the NCAA. "It's not just that a private university can lose its own money," says Ted Curtis, a sports attorney and a professor of sports administration at Lynn University in Boca Raton, Florida. "When you start dealing with state universities, that's when the legislature gets involved."

After a spate of similar scandals in the mid-1990s, the NCAA and state governments did indeed get involved. The NCAA asked the National Conference of Commissioners on Uniform State Laws, the organization that developed the Uniform Commercial Code and Uniform Probate Code, for help in forming a uniform code for a sports agent law.

Initially reluctant to deal with sports agents because it had traditionally worked only in the areas of commerce and family law, NCCUSL eventually decided that it would take up the issue. The group held three years of hearings to develop a model law, including testimony by athletes, university conferences and agents. In 2000, NCCUSL voted to accept the Uniform Athlete Agents Act in its annual meeting, and last year, Utah became the first state to adopt the law.

The idea behind the law is that states working together can succeed where states working independently have failed. Under the previous system, about half of the states had no law on the books at all. In other states, agent legislation ranged from a simple criminal designation in Michigan to a hefty fee and a competency exam in Florida. "It's not that the states hadn't done anything," says Michael Kerr, deputy executive director of NCCUSL, "it's that they had done completely different things."

What's more, few states enforced any of their agent laws, whether they required registration, notification or criminal penalties. And it was lucky for agents that the states didn't pay much attention, because they frequently travel the country looking for the next hot prospect to sign. Keeping up with numerous state laws would have amounted to a recurring nightmare. "In one state, they had to keep records for three years, in other states, four or five years. In some states, an athlete had 15 days to rescind a contract, others had 10 or 12," Curtis says. "Agents had no idea how to do their jobs."

Through reciprocal registration, the Athlete Agents Act eliminates much of that hassle. An agent registers in one state by filling out a standard form and paying a set fee, which varies from $20 in Arizona to $100 in Mississippi. Once agents follow the law and register in one state, they need only to fill out a simple form and pay a nominal fee in all other states that have adopted the act. That way, each state has to do less paperwork and agents can easily follow the law without having to worry when they cross state lines to do their business. Registration information, such as criminal records, past clients and educational experience, also then becomes available to the public. The hope is that the wealth of consumer information will be the first step in weeding out unscrupulous agents.

For the corrupt agents that do still get hired, the law also provides concrete enforcement measures. Under the Uniform Athlete Agents Act, an agent is not allowed to give false information or promises, give anything of value to a student before a contract is signed or initiate contact with a student before the agent has registered with the state. If an agent disobeys, the law gives states subpoena power to obtain any necessary documents and spells out penalties for infractions. Most states that have already passed the law chose to punish violators with some class of felony. Punishments range from a $2,500 fine in Arizona to up to two years in prison and a $10,000 fine in Mississippi.

The act also deals with specific player contracts. It stipulates that a contract must include a specific warning to athletes, notifying them that by signing a contract with an agent, they will lose their NCAA eligibility. The contract also lets both the student and the agent know that they must notify the college within 72 hours that an agreement has been reached and that the student has the right to cancel the agreement within 14 days. If the student or agent does not notify the school, the school has the right to sue them for monetary damages.

Thus far, passage of the law has been remarkably smooth. "It isn't the kind of thing where everybody will agree that every part is perfect," Curtis says. "But NCCUSL did a good job of trying to please everybody."

In addition to simplifying their legal paperwork, the law provides agents with an opportunity to combat the common perception of their profession as wily and exploitative. "It's a great act for legitimate agents," says Roy Kessel, a sports agent and president of Chicago's SportsLoop company. "The old system made it so difficult that even some of the most high profile and legitimate agents didn't comply. This way, if you're not complying, you're not trying to comply."

For schools and states, the law is a tool to help prevent embarrassing and costly scandals. More than half of the states have either introduced or approved the law, and Kerr expects that the rest of the states will pass it in the next three or four years. In states where the act has been debated but not enacted, passage has stalled because of financial or administrative hurdles--not a quarrel with the bill on policy grounds.

The lone act of policy opposition to the measure came last year in New Mexico, when Governor Gary Johnson vetoed the bill after it passed overwhelmingly in both houses. Johnson's veto message to the Speaker of the House stated that "while I am generally supportive of uniform laws as a means to provide certainty in the courts, I am troubled that New Mexico would become one of the few states in this country to enact these provisions. In addition, the regulation of agents for student athletes is best left to governing organizations such as the National Collegiate Athletic Association."

States that already have sports agent laws, especially those that have passed laws recently, may prove to be equally unenthusiastic. In Ohio, for example, legislators finally passed an agent law in 2001, and are not eager to scrap it for a brand-new one. Although the spirit of the Ohio law is the same as the Uniform Athlete Agents Act, some of the punishments and restrictions are different, causing problems for agents who expect all state laws to be consistent.

Also, some states may oppose one controversial provision in the uniform act: that schools can sue students for monetary damages if students do not notify them that they have retained an agent. The American Bar Association initially raised concern about that provision, before approving the act as a whole. So far, however, legislators have not identified that issue as a stumbling block.

Most of the states that have enacted the measure are not traditional stomping grounds for sports agents, so registration has not yet gained much momentum. That's likely to change in July, when the law goes into effect in Florida, where many agents are headquartered. It also remains to be seen whether states will enforce the uniform agent law, given that they have not traditionally enforced such laws in the past. Because of the simplicity of the law and the endorsements by players' associations and the NCAA, Kerr is confident that this time the law will stick. "For the first time, to some degree, it will be the sports agents themselves who will drive the enforcement," he says. "Once they have a finite idea of what the law will look like, they will be more likely to follow the rules."