H. Rept. 108-24 - SPORTS AGENT RESPONSIBILITY AND TRUST ACT108th Congress (2003-2004)
Committee Report
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108th Congress Report 108-24
HOUSE OF REPRESENTATIVES
1st Session Part 2
======================================================================
SPORTS AGENT RESPONSIBILITY AND TRUST ACT
_______
June 2, 2003.--Ordered to be printed
_______
Mr. Sensenbrenner, from the Committee on the Judiciary, submitted the
following
R E P O R T
[To accompany H.R. 361]
[Including cost estimate of the Congressional Budget Office]
The Committee on the Judiciary, to whom was referred the
bill (H.R. 361) 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, having considered the same, reports
favorably thereon with an amendment and recommends that the
bill as amended do pass.
CONTENTS
Page
The Amendment.................................................... 1
Purpose and Summary.............................................. 4
Background and Need for the Legislation.......................... 4
Hearings......................................................... 5
Committee Consideration.......................................... 5
Vote of the Committee............................................ 6
Committee Oversight Findings..................................... 6
New Budget Authority and Tax Expenditures........................ 6
Congressional Budget Office Cost Estimate........................ 6
Performance Goals and Objectives................................. 8
Constitutional Authority Statement............................... 8
Section-by-Section Analysis and Discussion....................... 8
Changes in Existing Law Made by the Bill, as Reported............ 9
Markup Transcript................................................ 9
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Sports Agent Responsibility and
Trust Act''.
SEC. 2. DEFINITIONS.
As used in this Act, the following definitions apply:
(1) Agency contract.--The term ``agency contract'' means an
oral or written agreement in which a student athlete authorizes
a person to negotiate or solicit on behalf of the student
athlete a professional sports contract or an endorsement
contract.
(2) Athlete agent.--The term ``athlete agent'' means an
individual who enters into an agency contract with a student
athlete, or directly or indirectly recruits or solicits a
student athlete to enter into an agency contract, and does not
include a spouse, parent, sibling, grandparent, or guardian of
such student athlete, any legal counsel for purposes other than
that of representative agency, or an individual acting solely
on behalf of a professional sports team or professional sports
organization.
(3) Athletic director.--The term ``athletic director''
means an individual responsible for administering the athletic
program of an educational institution or, in the case that such
program is administered separately, the athletic program for
male students or the athletic program for female students, as
appropriate.
(4) Commission.--The term ``Commission'' means the Federal
Trade Commission.
(5) Endorsement contract.--The term ``endorsement
contract'' means an agreement under which a student athlete is
employed or receives consideration for the use by the other
party of that individual's person, name, image, or likeness in
the promotion of any product, service, or event.
(6) Intercollegiate sport.--The term ``intercollegiate
sport'' means a sport played at the collegiate level for which
eligibility requirements for participation by a student athlete
are established by a national association for the promotion or
regulation of college athletics.
(7) Professional sports contract.--The term ``professional
sports contract'' means an agreement under which an individual
is employed, or agrees to render services, as a player on a
professional sports team, with a professional sports
organization, or as a professional athlete.
(8) State.--The term ``State'' includes a State of the
United States, the District of Columbia, Puerto Rico, the
United States Virgin Islands, or any territory or insular
possession subject to the jurisdiction of the United States.
(9) Student athlete.--The term ``student athlete'' means an
individual who engages in, is eligible to engage in, or may be
eligible in the future to engage in, any intercollegiate sport.
An individual who is permanently ineligible to participate in a
particular intercollegiate sport is not a student athlete for
purposes of that sport.
SEC. 3. REGULATION OF UNFAIR AND DECEPTIVE ACTS AND PRACTICES IN
CONNECTION WITH THE CONTACT BETWEEN AN ATHLETE
AGENT AND A STUDENT ATHLETE.
(a) Conduct Prohibited.--It is unlawful for an athlete agent to--
(1) directly or indirectly recruit or solicit a student
athlete to enter into an agency contract, by--
(A) giving any false or misleading information or
making a false promise or representation; or
(B) providing anything of value to a student
athlete or anyone associated with the student athlete
before the student athlete enters into an agency
contract, including any consideration in the form of a
loan, or acting in the capacity of a guarantor or co-
guarantor for any debt;
(2) enter into an agency contract with a student athlete
without providing the student athlete with the disclosure
document described in subsection (b); or
(3) predate or postdate an agency contract.
(b) Required Disclosure by Athlete Agents to Student Athletes.--
(1) In general.--In conjunction with the entering into of
an agency contract, an athlete agent shall provide to the
student athlete, or, if the student athlete is under the age of
18, to such student athlete's parent or legal guardian, a
disclosure document that meets the requirements of this
subsection. Such disclosure document is separate from and in
addition to any disclosure which may be required under State
law.
(2) Signature of student athlete.--The disclosure document
must be signed by the student athlete, or, if the student
athlete is under the age of 18, by such student athlete's
parent or legal guardian, prior to entering into the agency
contract.
(3) Required language.--The disclosure document must
contain, in close proximity to the signature of the student
athlete, or, if the student athlete is under the age of 18, the
signature of such student athlete's parent or legal guardian, a
conspicuous notice in boldface type stating: ``Warning to
Student Athlete: If you agree orally or in writing to be
represented by an agent now or in the future you may lose your
eligibility to compete as a student athlete in your sport.
Within 72 hours after entering into this contract or before the
next athletic event in which you are eligible to participate,
whichever occurs first, both you and the agent by whom you are
agreeing to be represented must notify the athletic director of
the educational institution at which you are enrolled, or other
individual responsible for athletic programs at such
educational institution, that you have entered into an agency
contract.''.
SEC. 4. ENFORCEMENT.
(a) Unfair or Deceptive Act or Practice.--A violation of this Act
shall be treated as a violation of a rule defining an unfair or
deceptive act or practice prescribed under section 18(a)(1)(B) of the
Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)).
(b) Actions by the Commission.--The Commission shall enforce this
Act in the same manner, by the same means, and with the same
jurisdiction, powers, and duties as though all applicable terms and
provisions of the Federal Trade Commission Act (15 U.S.C. 41 et seq.)
were incorporated into and made a part of this Act.
SEC. 5. ACTIONS BY STATES.
(a) In General.--
(1) Civil actions.--In any case in which the attorney
general of a State has reason to believe that an interest of
the residents of that State has been or is threatened or
adversely affected by the engagement of any athlete agent in a
practice that violates section 3 of this Act, the State may
bring a civil action on behalf of the residents of the State in
a district court of the United States of appropriate
jurisdiction to--
(A) enjoin that practice;
(B) enforce compliance with this Act; or
(C) obtain damage, restitution, or other
compensation on behalf of residents of the State.
(2) Notice.--
(A) In general.--Before filing an action under
paragraph (1), the attorney general of the State
involved shall provide to the Commission--
(i) written notice of that action; and
(ii) a copy of the complaint for that
action.
(B) Exemption.--Subparagraph (A) shall not apply
with respect to the filing of an action by an attorney
general of a State under this subsection, if the
attorney general determines that it is not feasible to
provide the notice described in that subparagraph
before filing of the action. In such case, the attorney
general of a State shall provide notice and a copy of
the complaint to the Commission at the same time as the
attorney general files the action.
(b) Intervention.--
(1) In general.--On receiving notice under subsection
(a)(2), the Commission shall have the right to intervene in the
action that is the subject of the notice.
(2) Effect of intervention.--If the Commission intervenes
in an action under subsection (a), it shall have the right--
(A) to be heard with respect to any matter that
arises in that action; and
(B) to file a petition for appeal.
(c) Construction.--For purposes of bringing any civil action under
subsection (a), nothing in this title shall be construed to prevent an
attorney general of a State from exercising the powers conferred on the
attorney general by the laws of that State to--
(1) conduct investigations;
(2) administer oaths or affirmations; or
(3) compel the attendance of witnesses or the production of
documentary and other evidence.
(d) Actions by the Commission.--In any case in which an action is
instituted by or on behalf of the Commission for a violation of section
3, no State may, during the pendency of that action, institute an
action under subsection (a) against any defendant named in the
complaint in that action.
(e) Venue.--Any action brought under subsection (a) may be brought
in the district court of the United States that meets applicable
requirements relating to venue under section 1391 of title 28, United
States Code.
(f) Service of Process.--In an action brought under subsection (a),
process may be served in any district in which the defendant--
(1) is an inhabitant; or
(2) may be found.
SEC. 6. PROTECTION OF EDUCATIONAL INSTITUTION.
(a) Notice Required.--Within 72 hours after entering into an agency
contract or before the next athletic event in which the student athlete
may participate, whichever occurs first, the athlete agent and the
student athlete shall each inform the athletic director of the
educational institution at which the student athlete is enrolled, or
other individual responsible for athletic programs at such educational
institution, that the student athlete has entered into an agency
contract, and the athlete agent shall provide the athletic director
with notice in writing of such a contract.
(b) Civil Remedy.--
(1) In general.--An educational institution has a right of
action against an athlete agent for damages caused by a
violation of this Act.
(2) Damages.--Damages of an educational institution may
include and are limited to actual losses and expenses incurred
because, as a result of the conduct of the athlete agent, the
educational institution was injured by a violation of this Act
or was penalized, disqualified, or suspended from participation
in athletics by a national association for the promotion and
regulation of athletics, by an athletic conference, or by
reasonable self-imposed disciplinary action taken to mitigate
actions likely to be imposed by such an association or
conference.
(3) Costs and attorneys fees.--In an action taken under
this section, the court may award to the prevailing party costs
and reasonable attorneys fees.
(4) Effect on other rights, remedies and defenses.--This
section does not restrict the rights, remedies, or defenses of
any person under law or equity.
SEC. 7. LIMITATION.
Nothing in this Act shall be construed to prohibit an individual
from seeking any remedies available under existing Federal or State law
or equity.
SEC. 8. SENSE OF CONGRESS.
It is the sense of Congress that States should enact the Uniform
Athlete Agents Act of 2000 drafted by the National Conference of
Commissioners on Uniform State Laws, to protect student athletes and
the integrity of amateur sports from unscrupulous sports agents. In
particular, it is the sense of Congress that States should enact the
provisions relating to the registration of sports agents, the required
form of contract, the right of the student athlete to cancel an agency
contract, the disclosure requirements relating to record maintenance,
reporting, renewal, notice, warning, and security, and the provisions
for reciprocity among the States.
Purpose and Summary
The purpose of H.R. 361, the ``Sports Agent Responsibility
and Trust Act,'' is 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 (FTC). It provides
for a cause of action for economic damages to be sought by
either the FTC, the attorney general for the State of
occurrence, or the educational institution harmed.
Background and Need for the Legislation
The multi-million dollar value of professional athlete
salaries, signing bonuses, and endorsement contracts has
produced a proliferation of questionable ethical practices by
some sports agents. Unscrupulous agents, or their
representatives, are willing to break the rules in order to
sign promising student athletes to a representational contract
because the fees that accompany the representation of a
professional athlete are considerable, and the agent will risk
little in comparison to the athlete or school.
Motivated largely by financial gain, unscrupulous agents
have gone to extreme measures with promising student athletes
with even a remote chance of becoming a professional athlete.
However, whether a college athlete will succeed professionally
is highly speculative. It has been estimated that an National
Collegiate Athletic Association (NCAA) athlete has little more
than a 1-percent chance of making a professional team, even in
a backup role.\1\ These agents, or their associates--often
known as ``runners''--will use tactics including secret
payments to the athlete, undisclosed payments to the family or
friends of the athlete who may be in a position to influence
him or her, unrealistic promises, and even pressuring the
athlete through intimidation and threats. In some cases, these
agents have made secret payments to student athletes or their
families, and then blackmailed them into signing a contract
with the threat that they would disclose the violation of
collegiate rules thus jeopardizing the student's competitive
eligibility. These acts go unpunished due to disparate,
ineffective, or in some cases, a complete absence of State
laws.
---------------------------------------------------------------------------
\1\ NCAA Online, Estimated Probability of Competing in Athletics
Beyond the High School Interscholastic Level (Visited May 13, 2003)
.
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A student athlete entering into an oral or written agency
contract generally forfeits collegiate eligibility.\2\ In
addition, the college or university may be subject to various
sanctions for violation of competition rules if contests were
played with ineligible athletes. If this occurs, the economic
impact to the school and the athlete can be substantial. Not
only can a student athlete lose a scholarship, the university
can be sanctioned with monetary penalties, loss of
scholarships, forfeiture of contests, and loss of television
revenue.
---------------------------------------------------------------------------
\2\ Id., NCAA Regulations Related to Agents and Other Amateurism
Provisions, Sub II (Visited May 13, 2003) .
---------------------------------------------------------------------------
Currently, there is no Federal law that directly addresses
the actions of these agents, although a majority of the States
do regulate--in varying degrees--athlete agents and their
conduct. Most recently, the National Conference of
Commissioners on Uniform State Laws passed the Uniform
Athlete's Agent Act (UAAA) in 2000 addressing the conduct,
practices, and registration of athlete agents. H.R. 361 will
provide remedies to protect student athletes and the
educational institutions, particularly in those States with no
existing law addressing athlete agent conduct.
Hearings
On May 15, 2003, the Subcommittee on Commercial and
Administrative Law held a hearing on H.R. 361, at which
Congressman Bart Gordon, Congressman Tom Osborne, and sports
agent Scott Boras testified. In addition, written testimony was
provided by the National Collegiate Athletic Association.
Committee Consideration
On May 15, 2003, the Subcommittee on Commercial and
Administrative Law marked up the bill and ordered it favorably
reported with an amendment to the full Committee. The
amendment, offered by Chairman Cannon, made clarifying
revisions to the bill. This amendment, which was adopted by
voice vote, does the following: (1) clarifies the right of an
individual student athlete to have available legal counsel
outside of the realm of representative agency; (2) gives
additional emphasis to the provision on the use of loans or co-
signing of debts for the student athlete or those associated
with him in anticipation of future agency representation of
that athlete; (3) strikes overly broad language relating to
court remedies; and (4) specifies that the bill does not
prohibit an individual from seeking any remedies available to
them under existing State law or equity. Mr. Cannon's amendment
was adopted by voice vote.
On May 21, 2003, the Committee met in open session and
ordered favorably reported the bill H.R. 361, with amendment,
by voice vote, a quorum being present. At the full Committee
markup, Mr. Watt offered an amendment that clarified that
nothing in the bill prohibits an individual from seeking any
remedy under Federal law. Mr. Watt's amendment was adopted by
voice vote.
Vote of the Committee
In compliance with clause 3(b) of the rule XIII of the
Rules of the House of Representatives, the Committee notes that
no rollcall votes occurred during the Committee's consideration
of H.R. 361.
Committee Oversight Findings
In compliance with clause 3(c)(1) of rule XIII of the Rules
of the House of Representatives, the Committee reports that the
findings and recommendations of the Committee, based on
oversight activities under clause 2(b)(1) of rule X of the
Rules of the House of Representatives, are incorporated in the
descriptive portions of this report.
New Budget Authority and Tax Expenditures
Clause 3(c)(2) of House rule XIII is inapplicable because
this legislation does not provide new budgetary authority or
increased tax expenditures.
Congressional Budget Office Cost Estimate
In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, the Committee sets forth, with
respect to the bill, H.R. 361, the following estimate and
comparison prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act of
1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, May 28, 2003.
Hon. F. James Sensenbrenner, Jr., Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 361, the Sports
Agent Responsibility and Trust Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Julie
Middleton (for Federal costs), who can be reached at 226-2860,
Victoria Heid Hall and Gregory Waring (for the state and local
impact), who can be reached at 225-2330, and Paige Piper/Bach
(for the private-sector impact), who can be reached at 226-
2940.
Sincerely,
Douglas Holtz-Eakin.
Enclosure
cc:
Honorable John Conyers, Jr.
Ranking Member
H.R. 361--Sports Agent Responsibility and Trust Act.
H.R. 361 would impose certain restrictions on contracts
between sports agents and student athletes. For example, the
bill would prohibit sports agents from soliciting such a
contract by making false promises or offering gifts. These new
rules would be enforced by the Federal Trade Commission (FTC)
through civil penalties and by the States.
CBO estimates that enacting H.R. 361 would not have a
significant impact on the Federal budget. Based on information
from the FTC, CBO expects that enforcement of the bill would
occur mostly at the State level. Therefore, CBO expects that
any increase in civil penalties resulting from the enactment of
H.R. 361 would be insignificant. (Such penalties are recorded
in the budget as revenues.) Similarly, we estimate that
implementing H.R. 361 would increase the FTC's costs by less
than $500,000 annually, assuming the availability of
appropriated funds.
H.R. 361 contains no intergovernmental mandates as defined
in the Unfunded Mandates Reform Act (UMRA) and would impose no
costs on State, local, or tribal governments.
H.R. 361 would impose private-sector mandates as defined by
UMRA on certain sports agents and student athletes. The bill
would prohibit a sports agent from providing anything of value
to a student athlete or anyone associated with the athlete
before entering into a contract. An agent also would be
required to provide a student athlete with a specific
disclosure document before entering into an agency contract and
could not predate or postdate such a contract. The bill would
require a student athlete, or the athlete's parents or legal
guardian if the student is under the age of 18, to sign the
disclosure document prior to entering into an agency contract.
In addition, the bill would require the sports agent and
student athlete to each inform the student's educational
institution within a specific time frame that the athlete has
entered into an agency contract. Based on information from
government sources, CBO estimates that the direct cost of those
mandates would fall well below the annual threshold established
by UMRA for private-sector mandates ($117 million in 2003,
adjusted annually for inflation).
On January 31, 2003, CBO transmitted a cost estimate for
H.R. 361 as ordered reported by the House Committee on Energy
and Commerce on January 29, 2003. The two versions of the bill
are similar, and the cost estimates are identical.
The CBO staff contacts for this estimate are Julie
Middleton (for Federal costs), who can be reached at 226-2860,
Victoria Heid Hall and Gregory Waring (for the State and local
impact), who can be reached at 225-2330, and Paige Piper/Bach
(for the private-sector impact), who can be reached at 226-
2940. The estimate was approved by Peter H. Fontaine, Deputy
Assistant Director for Budget Analysis.
Performance Goals and Objectives
H.R. 361 does not authorize funding. Therefore, clause
3(c)(4) of rule XIII of the Rules of the House of
Representatives is inapplicable.
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds the authority for
this legislation in article I, section 8, of the Constitution.
Section-by-Section Analysis and Discussion
Section 1 provides that this Act may be cited as the
``Sports Agent Responsibility and Trust Act.''
Section 2 defines terms used within the bill. Of special
note is the definition of ``athlete agent,'' which is limited
to those who are representing the athlete under an agency
contract, and is not meant to deter other legal counsel or
assistance.
Section 3 defines conduct prohibited by an athlete agent.
Prohibited acts include giving false or misleading information;
providing anything of value to the athlete or anyone associated
with the athlete before entering into a representative
contract; requiring disclosure at the time of signing into the
contract that the athlete may forfeit NCAA eligibility as a
result of the signing of the contract; and the predating or
postdating of the contract.
Section 4 defines a violation of this Act as an unfair or
deceptive act or practice, and as such, a violation enforceable
under the Federal Trade Commission guidelines relating to such
a violation.
Section 5 gives an attorney general of a State where this
action occurs standing to enforce this Act. The attorney
general may file a civil action on behalf of the inhabitants of
the State to enjoin the actions, enforce compliance with this
act, and obtain damages, restitution, or other compensation on
behalf of the residents of the State.
Section 6 gives protection to educational institutions
which are damaged as a result of the conduct this act seeks to
prevent. If proper notice, which should occur within 72 hours
after signing an agency agreement or the next athletic event
which the student athlete may participate in (whichever occurs
first), is not given to the individual in charge of that
university's athletic program, a violation of this act occurs.
After such violation, the educational institution is given a
civil remedy for the damages the institution suffered as a
result of the non-disclosure.
Section 7 states that nothing in this act is meant to
prohibit an individual from seeking any remedies available to
them under existing State law or equity. Mr. Watt's amendment,
which was adopted by the full Committee, extended this
provision to existing Federal remedies.
Section 8 expresses the sense of Congress that States
should enact the UAAA as drafted by the Uniform Conference of
Commissioners on Uniform State Laws.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, the Committee notes H.R. 361
makes no changes to existing law.
Markup Transcript
BUSINESS MEETING
WEDNESDAY, MAY 21, 2003
House of Representatives,
Committee on the Judiciary,
Washington, DC.
The Committee met, pursuant to notice, at 10:01 a.m., in
Room 2141, Rayburn House Office Building, Hon. F. James
Sensenbrenner, Jr. (Chairman of the Committee) presiding.
[Intervening business.]
Chairman Sensenbrenner. The next item on the agenda is H.R.
361, the ``Sports Agent Responsibility and Trust Act.'' The
Chair recognizes the gentleman from Utah, Mr. Cannon, the
Chairman of the Subcommittee on Commercial and Administrative
Law, for a motion.
Mr. Cannon. The Subcommittee on Commercial and
Administrative Law favorably reports the bill H.R. 361 with a
single amendment in the nature of a substitute and urges--or
moves its adoption by the full Committee.
Chairman Sensenbrenner. Without objection, the bill will be
considered as read and open for amendment at any point.
[The bill, H.R. 361, follows:]
Chairman Sensenbrenner. And the Subcommittee amendment in
the nature of a substitute, which the Members have before them,
will be considered as read, considered as the original text for
purposes of amendment, and open for amendment at any point.
[The amendment in the nature of a substitute follows:]
Chairman Sensenbrenner. The Chair recognizes the gentleman
from Utah, Mr. Cannon, to strike the last word.
Mr. Cannon. Thank you, Mr. Chairman.
The Subcommittee held a hearing on this bill on May 15th
and reported the bill the same day. The Subcommittee adopted an
amendment of a substitute with bipartisan support, clarifying a
number of matters within the bill as well as specifically
preserving the right of student athletes to seek individual
redress from any contractual violations under existing State
law or equity.
Mr. Chairman, this is an important piece of legislation and
one which deserves the Committee's full support. H.R. 361 will
address the interaction of sports agents with student athletes.
It will give guidelines for sports agents to adhere to in the
recruitment and allow the Federal Trade Commission or the
attorney general of the State of occurrence to go after agents
who do not adhere to the guidelines. Set out in this bill--that
is, the guidelines set out in this bill.
In addition, it provides a cause of action for educational
institutions against a sport agent whose actions result in
making a player ineligible for collegiate competition. In an
all too common sequence of unethical conduct, such agents often
fail to properly notify the university, thus causing sanctions,
forfeitures, or other penalties to the university for which it
has no fault.
This bill is patterned after language in the Uniform
Athlete Agents Act, which has been adopted by over 20 States.
The need for a Federal solution is clear when one considers the
interstate nature of collegiate athletics. Currently there is
nothing to stop an unscrupulous sports agent from victim
shopping--or victim forum shopping by waiting to approach star
athletes in States with no appropriate enforcement tools,
States where those actions can occur without fear of
retribution or redress.
This bill does not indict the conduct of all sports agents.
Not all are the Bob Sugars, as depicted in the movie ``Jerry
Maguire.'' The bill seeks to protect the often guileless
student athlete from real-life consequences of dealing with the
unscrupulous. H.R. 361 was originally referred to the Committee
on Energy and Commerce, which reported this legislation by
voice vote on January 29th. The Committee on Judiciary received
a sequential referral, which expires on June 1.
Again, I urge the Committee to support this bill. Thank
you, Mr. Chairman.
Chairman Sensenbrenner. In the absence of Mr. Watt, does
any Member of the minority wish to make an opening statement?
If not, without objection, all Members may enter opening
statements in the record at this point.
Are there amendments?
Ms. Jackson Lee. Mr. Chairman?
Chairman Sensenbrenner. Does Mr. Watt have an opening
statement he'd like to make?
Mr. Watt. No, I don't have an opening statement. I have an
amendment, though.
Chairman Sensenbrenner. Okay.
Mr. Watt. Whenever you get to that point.
Chairman Sensenbrenner. We're at that point now. The clerk
will report the Watt amendment.
The Clerk. Mr. Chairman, I don't have a Watt amendment.
Mr. Watt. Right here.
Chairman Sensenbrenner. The clerk will forbear.
The clerk will now report the Watt amendment.
The Clerk. Amendment to the amendment in the nature of a
substitute to H.R.----
Mr. Watt. Mr. Chairman, I ask unanimous consent that the
amendment be considered as read.
The Clerk.--361 offered by Mr.----
Chairman Sensenbrenner. Without objection, the amendment is
considered as read.
[Mr. Watt's amendment follows:]
Chairman Sensenbrenner. The gentleman from North Carolina
is recognized for 5 minutes.
Mr. Watt. I thank the Chairman, and I apologize to the
Chairman for being in and out. But there are two markups going
on. Fortunately, they're all in the same hall, and I'm trying
to run back and forth.
The question came up in the Subcommittee about whether
individuals have a cause of action under this bill as opposed
to just the FTC and universities who may be adversely impacted
by the acts of agents. And Mr. Cannon clarified that partially
in his amendment to the bill which was passed in the
Subcommittee during our Subcommittee consideration.
Unfortunately, Mr. Cannon's amendment makes it explicit that
whatever individual rights a person has under State law or
equity are protected, but he didn't--his amendment didn't make
reference to Federal law. And I'm not sure that there are
causes of action under the Federal law other than with the FTC.
But after looking at this quite extensively, I thought--and I
think everybody agrees--that we should not be wiping out any
individual causes of action that individual claimants might
have as a result of passing this legislation, which is designed
to advance accountability on the part of sports agents.
And so this simply makes it clear that if there are other
potential Federal causes of action other than under this bill,
individual student athletes would have the right to pursue them
also, and I will yield to Mr. Cannon if he is trying to get me
to yield.
Mr. Cannon. Thank you. I was actually just wanting to let
you finish before I asked a question.
I'm not sure whether or not to oppose or accept the
amendment. I can't think of anything--a Federal action that
exists now that would favor students. Do you have something in
mind when you----
Mr. Watt. No, I don't. But I guess, in effect, what we're
saying is if there is any individual cause of action under
Federal law, we don't want to foreclose that. We're not
creating a cause of action, but we want to make it explicit
that we're not foreclosing the cause of action.
Mr. Cannon. If the gentleman would yield further, it is my
sense that what we're doing with this section is to not limit,
and I don't have a sense of the implications of adding Federal,
except to suggest that we don't want to--we don't want to
federalize more than we're trying to--we're trying to be very
narrow in what we're doing with this and not expand Federal
actions or causes of action.
Mr. Watt. And I absolutely agree with the gentleman, and if
the gentleman will take a look at his language that he inserted
at the Subcommittee level with the amendment that you offered,
on page 10 you say, ``Nothing in this Act shall be construed to
prohibit an individual from seeking any remedies available
under existing State law or equity.''
All we're doing is applying the same thing to any remedies
that might----
Chairman Sensenbrenner. Will the gentleman yield?
Mr. Watt.--exist under Federal law.
Chairman Sensenbrenner. Will the gentleman yield?
Mr. Watt. I'm happy to yield to the Chairman.
Chairman Sensenbrenner. I think the amendment is a logical
one, and I'm particularly concerned if ``Federal'' is left out
that a diversity suit against a sports agent that did not
reside in the State where the student or the educational
institution resided would end up being precluded from going
into Federal court. So I think the gentleman's amendment is a
constructive addition.
Mr. Watt. Well, I thank the gentleman, and the gentleman
knows----
Mr. Cannon. Would the gentleman----
Mr. Watt.--support getting all these things into Federal
court. So----
Mr. Cannon. Would the gentleman yield for a further
question?
Mr. Watt. Yes, I will yield to Mr. Cannon.
Mr. Cannon. We're about to----
Mr. Watt. I was saying that facetiously, of course, Mr.
Chairman.
Mr. Cannon. We're about to mark up a class action lawsuit.
Does the gentleman anticipate that this will have any effect on
class actions?
Mr. Watt. No, sir. I don't think so. These are individual
actions that we're dealing with.
Chairman Sensenbrenner. If the gentleman will yield
further, it might have an effect on class actions if there are
a whole lot of athletes that are----
Mr. Watt. Right, that could possibly be. But we're still--
hope springs eternal that the next bill will be defeated.
Chairman Sensenbrenner. The gentleman's time has expired.
The question----
Mr. Cannon. Mr. Chairman, I'm willing to accept the
gentleman's amendment and would like to go on record saying
that.
Chairman Sensenbrenner. The question is on adoption of the
amendment offered by the gentleman from North Carolina, Mr.
Watt. Those in favor will say aye. Opposed, no.
The ayes appear to have it. The ayes have it, and the
amendment is agreed to.
Are there further amendments? If there are no further
amendments, the Chair notes the presence of a reporting quorum.
Those in favor of reporting the bill favorably will say aye.
Opposed, no.
The ayes appear to have it. The ayes have it, and the
motion to report favorably is agreed to.
Without objection, the bill will be reported favorably to
the House in the form of a single amendment in the nature of a
substitute as amended, incorporating the amendments offered
here today. Without objection--adopted here today, excuse me.
Without objection, the Chairman is authorized to move to go to
conference pursuant to House rules. Without objection, the
staff is directed to make any technical and conforming changes,
and all Members will be given 2 days as provided by House rules
in which to submit additional, dissenting, supplemental, or
minority views.