As a former sports agent, I am often asked what it takes to become an agent. Many people assume you have to have a law degree, but while being a licensed attorney or having a law degree would be helpful, they are not prerequisites. In fact, becoming a sports agent does not require any type of specialized degree. Instead, the requirements are generally dictated by the various professional sports leagues and their respective players’ associations. Most leagues require some type of league certification, but the qualifying criteria and specific requirements vary depending on the league. As a result, many sports agents in the industry do not have law degrees. This makes it all the more important for athletes to turn to an attorney for counsel.
Agent Selection Process
Lawyers can help professional athletes, prospects, and their families navigate the agent selection process to find a reputable agent who is trustworthy and honest. A professional athlete or prospect, like any individual or business, should consult with an attorney before signing any contract or legal document. This includes the athlete’s contract with his or her agent. A lawyer can help explain the agreement so that the athlete knows exactly what they are signing.
Agent Commission Negotiations
A professional athlete or prospect must understand that the agent is paid by commission, meaning a percentage of the athlete’s contractual earnings. For example, in the NFL the most an agent can charge a player is 3% of the player’s contract. Other professional leagues allow higher agent commission rates. Depending upon the situation, the agent’s commission rate may be negotiated to an amount below the agent’s maximum allowable charge.
Athlete Contract Negotiations
Sports agents may run into various conflicts of interest in negotiating a player’s contract. For instance, an agent will typically negotiate several different player contracts with the same team throughout the course of the agent’s career. Thus, although the sports agent has a vested interest in negotiating the best deal possible for clients, they are often mindful to maintain a good working relationship with team they are negotiating against. This is just one example of a conflict of interest that agents face when representing multiple athletes. A seasoned sports lawyer would monitor these potential conflicts in order to ensure the agent is negotiating solely in the athlete’s best interest.
The legal ethics rules which apply to attorneys do not apply to agents, particularly those regarding conflicts of interests and client neglect. An attorney for a professional athlete can serve as a system of checks and balances on the athlete’s team of advisors, including the sports agent and financial advisor. All too often we hear stories of athletes going “broke” as a result of being taken advantage of by someone in their inner circle. Having an attorney serve as an athlete’s personal counsel can help avoid the pitfalls of unscrupulous or incompetent agents and advisors.
Business & Tax Issues, Family Affairs, Legal Disputes
Not only is it a good idea to have an attorney oversee a professional athlete’s business associates and advisors, but a good sports attorney should be knowledgeable in a variety of areas of law which a professional athlete will inevitably encounter at some point in his or her career. With this in mind, an attorney for professional athletes could provide legal advice and general counsel services in a diverse set of transactions and legal disputes. These services may include business law (corporate entity selection and structure, franchising, tax planning, charitable giving/foundations, etc.); intellectual property (protecting the athlete’s brand and businesses); real estate law (structuring, negotiating and closing transactions involving real estate investments and acquisitions); estate planning (developing and implementing plans to safeguard the athlete and his or her family, including tax and asset protection planning); family law (child support, divorce and premarital and postmartial planning, including prenuptial agreements); and litigation (civil disputes and criminal representation).
For most professional athletes, the career window is short. A skilled sports lawyer can help an athlete capitalize on earning opportunities within that career window and assist in the formation and implementation of a long term plan to ensure financial stability.
For more information on the items covered in this article, contact Fraser Trebilcock attorney R. Paul Vance. From commercial litigation to insurance defense to sports law, Paul brings a diverse skill set to each matter for his clients. He currently serves on the Board of Directors for the Michigan Defense Trial Counsel and is President of the Michigan State University Varsity ‘S’ Club. Contact Paul at 517.377.0843 or firstname.lastname@example.org.