108TH CONGRESS

1ST SESSION H. R. 361

AN ACT

To designate certain conduct by sports agents relating to the signing of contracts with student athletes as unfair and deceptive acts or practices to

be regulated by the Federal Trade Commission.

108TH CONGRESS

1ST SESSION H. R. 361

AN ACT

To designate certain conduct by sports agents relating to

the signing of contracts with student athletes as unfair

and deceptive acts or practices to be regulated by the

Federal Trade Commission.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE.

2 This Act may be cited as the ‘‘Sports Agent Respon3 sibility and Trust Act’’.

4 SEC. 2. DEFINITIONS.

5 As used in this Act, the following definitions apply:

6 (1) AGENCY CONTRACT.—The term ‘‘agency

7 contract’’ means an oral or written agreement in

8 which a student athlete authorizes a person to nego9 tiate or solicit on behalf of the student athlete a pro10 fessional sports contract or an endorsement contract.

11 (2) ATHLETE AGENT.—The term ‘‘athlete

12 agent’’ means an individual who enters into an agen13 cy contract with a student athlete, or directly or in14 directly recruits or solicits a student athlete to enter

15 into an agency contract, and does not include a

16 spouse, parent, sibling, grandparent, or guardian of

17 such student athlete, any legal counsel for purposes

18 other than that of representative agency, or an indi19 vidual acting solely on behalf of a professional sports

20 team or professional sports organization.

21 (3) ATHLETIC DIRECTOR.—The term ‘‘athletic

22 director’’ means an individual responsible for admin23 istering the athletic program of an educational insti24 tution or, in the case that such program is adminis25 tered separately, the athletic program for male stu-
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1 dents or the athletic program for female students, as

2 appropriate.

3 (4) COMMISSION.—The term ‘‘Commission’’

4 means the Federal Trade Commission.

5 (5) ENDORSEMENT CONTRACT.—The term ‘‘en6 dorsement contract’’ means an agreement under

7 which a student athlete is employed or receives con8 sideration for the use by the other party of that in9 dividual’s person, name, image, or likeness in the

10 promotion of any product, service, or event.

11 (6) INTERCOLLEGIATE SPORT.—The term

12 ‘‘intercollegiate sport’’ means a sport played at the

13 collegiate level for which eligibility requirements for

14 participation by a student athlete are established by

15 a national association for the promotion or regula16 tion of college athletics.

17 (7) PROFESSIONAL SPORTS CONTRACT.—The

18 term ‘‘professional sports contract’’ means an agree19 ment under which an individual is employed, or

20 agrees to render services, as a player on a profes21 sional sports team, with a professional sports organi22 zation, or as a professional athlete.

23 (8) STATE.—The term ‘‘State’’ includes a State

24 of the United States, the District of Columbia, Puer25 to Rico, the United States Virgin Islands, or any
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1 territory or insular possession subject to the jurisdic2 tion of the United States.

3 (9) STUDENT ATHLETE.—The term ‘‘student

4 athlete’’ means an individual who engages in, is eli5 gible to engage in, or may be eligible in the future

6 to engage in, any intercollegiate sport. An individual

7 who is permanently ineligible to participate in a par8 ticular intercollegiate sport is not a student athlete

9 for purposes of that sport.

10 SEC. 3. REGULATION OF UNFAIR AND DECEPTIVE ACTS

11 AND PRACTICES IN CONNECTION WITH THE

12 CONTACT BETWEEN AN ATHLETE AGENT AND

13 A STUDENT ATHLETE.

14 (a) CONDUCT PROHIBITED.—It is unlawful for an

15 athlete agent to—

16 (1) directly or indirectly recruit or solicit a stu17 dent athlete to enter into an agency contract, by—

18 (A) giving any false or misleading informa19 tion or making a false promise or representa20 tion; or

21 (B) providing anything of value to a stu22 dent athlete or anyone associated with the stu23 dent athlete before the student athlete enters

24 into an agency contract, including any consider25 ation in the form of a loan, or acting in the ca-
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1 pacity of a guarantor or co-guarantor for any

2 debt;

3 (2) enter into an agency contract with a stu4 dent athlete without providing the student athlete

5 with the disclosure document described in subsection

6 (b); or

7 (3) predate or postdate an agency contract.

8 (b) REQUIRED DISCLOSURE BY ATHLETE AGENTS

9 TO STUDENT ATHLETES.—

10 (1) IN GENERAL.—In conjunction with the en11 tering into of an agency contract, an athlete agent

12 shall provide to the student athlete, or, if the stu13 dent athlete is under the age of 18, to such student

14 athlete’s parent or legal guardian, a disclosure docu15 ment that meets the requirements of this subsection.

16 Such disclosure document is separate from and in

17 addition to any disclosure which may be required

18 under State law.

19 (2) SIGNATURE OF STUDENT ATHLETE.—The

20 disclosure document must be signed by the student

21 athlete, or, if the student athlete is under the age of

22 18, by such student athlete’s parent or legal guard23 ian, prior to entering into the agency contract.

24 (3) REQUIRED LANGUAGE.—The disclosure doc25 ument must contain, in close proximity to the signa-
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1 ture of the student athlete, or, if the student athlete

2 is under the age of 18, the signature of such student

3 athlete’s parent or legal guardian, a conspicuous no4 tice in boldface type stating: ‘‘Warning to Student

5 Athlete: If you agree orally or in writing to be rep6 resented by an agent now or in the future you may

7 lose your eligibility to compete as a student athlete

8 in your sport. Within 72 hours after entering into

9 this contract or before the next athletic event in

10 which you are eligible to participate, whichever oc11 curs first, both you and the agent by whom you are

12 agreeing to be represented must notify the athletic

13 director of the educational institution at which you

14 are enrolled, or other individual responsible for ath15 letic programs at such educational institution, that

16 you have entered into an agency contract.’’.

17 SEC. 4. ENFORCEMENT.

18 (a) UNFAIR OR DECEPTIVE ACT OR PRACTICE.—A

19 violation of this Act shall be treated as a violation of a

20 rule defining an unfair or deceptive act or practice pre21 scribed under section 18(a)(1)(B) of the Federal Trade

22 Commission Act (15 U.S.C. 57a(a)(1)(B)).

23 (b) ACTIONS BY THE COMMISSION.—The Commis24 sion shall enforce this Act in the same manner, by the

25 same means, and with the same jurisdiction, powers, and
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1 duties as though all applicable terms and provisions of the

2 Federal Trade Commission Act (15 U.S.C. 41 et seq.)

3 were incorporated into and made a part of this Act.

4 SEC. 5. ACTIONS BY STATES.

5 (a) IN GENERAL.—

6 (1) CIVIL ACTIONS.—In any case in which the

7 attorney general of a State has reason to believe

8 that an interest of the residents of that State has

9 been or is threatened or adversely affected by the

10 engagement of any athlete agent in a practice that

11 violates section 3 of this Act, the State may bring

12 a civil action on behalf of the residents of the State

13 in a district court of the United States of appro14 priate jurisdiction to—

15 (A) enjoin that practice;

16 (B) enforce compliance with this Act; or

17 (C) obtain damage, restitution, or other

18 compensation on behalf of residents of the

19 State.

20 (2) NOTICE.—

21 (A) IN GENERAL.—Before filing an action

22 under paragraph (1), the attorney general of

23 the State involved shall provide to the

24 Commission—

25 (i) written notice of that action; and
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1 (ii) a copy of the complaint for that

2 action.

3 (B) EXEMPTION.—Subparagraph (A) shall

4 not apply with respect to the filing of an action

5 by an attorney general of a State under this

6 subsection, if the attorney general determines

7 that it is not feasible to provide the notice de8 scribed in that subparagraph before filing of the

9 action. In such case, the attorney general of a

10 State shall provide notice and a copy of the

11 complaint to the Commission at the same time

12 as the attorney general files the action.

13 (b) INTERVENTION.—

14 (1) IN GENERAL.—On receiving notice under

15 subsection (a)(2), the Commission shall have the

16 right to intervene in the action that is the subject

17 of the notice.

18 (2) EFFECT OF INTERVENTION.—If the Com19 mission intervenes in an action under subsection (a),

20 it shall have the right—

21 (A) to be heard with respect to any matter

22 that arises in that action; and

23 (B) to file a petition for appeal.

24 (c) CONSTRUCTION.—For purposes of bringing any

25 civil action under subsection (a), nothing in this title shall
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1 be construed to prevent an attorney general of a State

2 from exercising the powers conferred on the attorney gen3 eral by the laws of that State to—

4 (1) conduct investigations;

5 (2) administer oaths or affirmations; or

6 (3) compel the attendance of witnesses or the

7 production of documentary and other evidence.

8 (d) ACTIONS BY THE COMMISSION.—In any case in

9 which an action is instituted by or on behalf of the Com10 mission for a violation of section 3, no State may, during

11 the pendency of that action, institute an action under sub12 section (a) against any defendant named in the complaint

13 in that action.

14 (e) VENUE.—Any action brought under subsection

15 (a) may be brought in the district court of the United

16 States that meets applicable requirements relating to

17 venue under section 1391 of title 28, United States Code.

18 (f) SERVICE OF PROCESS.—In an action brought

19 under subsection (a), process may be served in any district

20 in which the defendant—

21 (1) is an inhabitant; or

22 (2) may be found.

23 SEC. 6. PROTECTION OF EDUCATIONAL INSTITUTION.

24 (a) NOTICE REQUIRED.—Within 72 hours after en25 tering into an agency contract or before the next athletic
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1 event in which the student athlete may participate, which2 ever occurs first, the athlete agent and the student athlete

3 shall each inform the athletic director of the educational

4 institution at which the student athlete is enrolled, or

5 other individual responsible for athletic programs at such

6 educational institution, that the student athlete has en7 tered into an agency contract, and the athlete agent shall

8 provide the athletic director with notice in writing of such

9 a contract.

10 (b) CIVIL REMEDY.—

11 (1) IN GENERAL.—An educational institution

12 has a right of action against an athlete agent for

13 damages caused by a violation of this Act.

14 (2) DAMAGES.—Damages of an educational in15 stitution may include and are limited to actual losses

16 and expenses incurred because, as a result of the

17 conduct of the athlete agent, the educational institu18 tion was injured by a violation of this Act or was pe19 nalized, disqualified, or suspended from participation

20 in athletics by a national association for the pro21 motion and regulation of athletics, by an athletic

22 conference, or by reasonable self-imposed discipli23 nary action taken to mitigate actions likely to be im24 posed by such an association or conference.
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1 (3) COSTS AND ATTORNEYS FEES.—In an ac2 tion taken under this section, the court may award

3 to the prevailing party costs and reasonable attor4 neys fees.

5 (4) EFFECT ON OTHER RIGHTS, REMEDIES AND

6 DEFENSES.—This section does not restrict the

7 rights, remedies, or defenses of any person under

8 law or equity.

9 SEC. 7. LIMITATION.

10 Nothing in this Act shall be construed to prohibit an

11 individual from seeking any remedies available under ex12 isting Federal or State law or equity.

13 SEC. 8. SENSE OF CONGRESS.

14 It is the sense of Congress that States should enact

15 the Uniform Athlete Agents Act of 2000 drafted by the

16 National Conference of Commissioners on Uniform State

17 Laws, to protect student athletes and the integrity of ama18 teur sports from unscrupulous sports agents. In par19 ticular, it is the sense of Congress that States should enact

20 the provisions relating to the registration of sports agents,

21 the required form of contract, the right of the student ath22 lete to cancel an agency contract, the disclosure require23 ments relating to record maintenance, reporting, renewal,
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1 notice, warning, and security, and the provisions for reci2 procity among the States.

Passed the House of Representatives June 4, 2003.

Attest:

Clerk.