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New Tennessee Athlete Agent Law Accounts For Cecil Newton, Will Lyles, Runners, Etc.

The Athlete Agent Reform Act of 2011, a new sports agent law in Tennessee, took effect four days ago on July 1, 2011.  With the new law in place, Tennessee becomes the most recent state to strengthen penalties with regards to illegal activities by sports agents.  As with other states, there is no indication that the new law will actually have any affect on regulation and enforcement, but at least Tennessee falls in line with other states, including Texas, which are either trying to scare agents with potential heavy jail sentences, appeasing their constituencies who continue to read about sports agent atrocities in the news, and/or trying to protect colleges from being sanctioned by the NCAA.  However, give credit to Tennessee for attacking current concerns with its legislation, including recruiters like Will Lyles, parents like Cecil Newton, runners, and financial planners, even if it fails to provide any punishment for athletes and/or universities who are involved in the illegal activities.

Texas’ new law could potentially lock a sports agent up in prison for 10 years for violating its athlete agent law; in Tennessee, the new law limits maximum jail time to 6 years.  Meanwhile, no one, including those who are involved in crafting and enforcing the new laws, can explain why individual state athlete agent laws only penalize one party in an illegal transaction (the exchange of benefits from sports agent to student-athlete).  The sports agent is the provider and the student-athlete is the recipient.  Now we have recruiters as the providers and universities as the recipients, as well.  When a drug dealer sells cocaine to a drug user, both parties are guilty of involvement in an illegal transaction.  Tell that to your state legislators.

The new Tennessee law requires all sports agents recruiting in the state to register with the Tennessee Secretary of State.  Failure to even register can result in an agent spending 6 years in prison, in addition to paying a $25,000 fine.  The law also changes the definition of “sports agent” to include runners, managers, marketing representatives, financial advisors, and others working on behalf of an agent.  Further, Tennessee’s law takes into account the Cam Newton Loophole and states that “Athlete agent” does not include a parent or legal guardian, unless the parent or legal guardian of the student athlete accepts a form of a financial benefit or gift on behalf of the student athlete.  If you are going to have an athlete agent law on the books, which I am not totally sold on, at least have it reflect current issues.  In this regard, Tennessee does a good job of including runners, financial advisors, and even parents who are accepting benefits under the scope of regulation.

Nestled into the new law is also a section that I will title the Will Lyles provision.  It provides that any person who knowingly influences, or attempts to influence, any student-athlete to accept an athletic scholarship that is offered by a higher education institution from which such person receives any compensation or any other thing of value shall provide a written disclosure of such person’s relationship with the higher education institution to the student-athlete concurrently with initially making such influence or attempt to influence.  That person must also provide written disclosure of the relationship to the student-athlete’s parent, secretary of state, and athletic director, president and general counsel of the higher education institution within 48 hours of disclosing it to the student-athlete.  Failure to provide the written disclosure is also punishable by up to $25,000 and/or confinement for up to 6-years, but no less than 1-year.  For those of you not familiar with Will Lyles, he is the scouting service owner who says that University of Oregon coach Chip Kelly approved a $25,000 fee to Lyles in exchange for recruiting assistance.  Charles Robinson and Dan Wetzel did a great job of describing Lyles’ relationship with Oregon in their recent Yahoo! Sports article.

The new law can be found in the Tennessee Code Annotated, Section 49-7-2122.  I have embedded the signed legislation at the bottom of this post.

Tennessee Athlete Agent Reform Act of 2011

By Darren Heitner

Darren Heitner created Sports Agent Blog as a New Year's Resolution on December 31, 2005. Originally titled, "I Want To Be A Sports Agent," the website was founded with the intention of causing Heitner to learn more about the profession that he wanted to join, meet reputable individuals in the space and force himself to stay on top of the latest news and trends.

Heitner now runs Heitner Legal, P.L.L.C., which is a law firm with many practice areas, including sports law and contract law. Heitner has represented numerous athletes and sports agents as legal counsel. He has also served as an Adjunct Professor at Indiana University Bloomington from 2011-2014, where he created and taught a course titled, Sport Agency Management, which included subjects ranging from NCAA regulations to athlete agent certification and the rules governing the profession. Heitner serves as an Adjunct Professor at the University of Florida Levin College of Law, where he teaches a Sports Law class that includes case law surrounding athlete agents and the NCAA rules.