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Oklahoma Governor Signs Law that Allows Universities to Sue Boosters and Agents

Oklahoma Governor Mary Fallin signed a bill that will allow colleges and universities to sue boosters and agents who cause colleges and universities to incur athletic sanctions from the NCAA (or other governing body). Senate Bill 425 states:

Any public or private institution of higher education that is a member of a governing authority shall have a cause of action against a third party who engages or conspires with another to engage in conduct in violation of the rules of the governing authority that causes the educational institution to incur sanctions by the governing authority or other economic penalties or losses. The educational institution may recover damages in the amount of the sanctions, penalties or economic losses incurred as a result of the conduct of the third party, and reasonable attorney fees and costs.

This law is similar to a law passed by the State of Texas in 1987. Section 131.004 of the Texas Civil Practice and Remedies Code states “a person who violates a rule of a national collegiate athletic association adopted by this chapter is liable for damages in an action brought by an institution if (1) the person knew or reasonably should have know that a rule was violated; and (2) the violation of the rule is a contributing factor to disciplinary action taken by the national collegiate athletic association against the institution or a student at the institution.” Although the Oklahoma legislation does not specifically reference intercollegiate athletic competition, the effect of the legislation is the same.

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