Bad booster lawsuits open in Oklahoma

A new law lets universities sue sports boosters and agents who expose the school to sanctions.

Gov. Mary Fallin signed Senate Bill 425 on Thursday. It goes into effect Nov. 1.

The measure allows a lawsuit against third parties who trigger penalties and economic losses against schools for breaking a governing body’s rules. For example, if a booster gives cash to a student athlete in violation of NCAA rules and the NCAA fines the university, a court could order the booster to pay damages to the school.

The bill doesn’t specifically mention sports, but colleges and universities have lost major revenue from sanctions that prevent playoff appearances and other missed games. While collegiate sports supporters praised the law, it might also create hesitation among legitimate supporters who worry about getting sued if they accidentally break the rules.

Richard Knapp, executive director of the University of Oklahoma’s Touchdown Club, said the bill would affect a lot of people.

“When I heard about it, it had a chilling effect on me,” he said.

Still, he said the new law will help prevent noncompliance by the kind of people who don’t coordinate their support through the school or official booster clubs like his. People who get the university in trouble are people who work outside the university system, he said.

The Touchdown Club is audited by both the university and NCAA, he said.

Oklahoma City attorney and sports agent Kelli Masters said if there’s a chilling effect, it will be a good one.

“They’re quite honestly able to get away with a lot of improper payments, improper benefits because essentially, they believe they won’t be punished,” said Masters. “Seeing an actual state law that has some teeth, that could be enforceable against bad actors — that’s really the only way to curtail that type of behavior.”

Universities have compliance divisions that help navigate the complex rules enacted by governing entities like the NCAA. OU booster Wallis Marsh said he calls the athletic department to make sure he stays within the rules.

“(The bill) doesn’t scare me at all because it’s a black eye for all of us if someone does something wrong,” said Marsh.“So many times, the people that support the university over the course of years and decades, those aren’t the people getting them in trouble.”

Marsh called the new law real accountability. But what it doesn’t do, he added, is protect donors when the university is the one breaking rules.

“If we’re giving money to the university assuming everyone was following the rules, are we entitled to get our money back?” he said.