Are top-drawer college football teams and their name, image and likeness collectives simply trying to protect themselves from willy-nilly transfers or are they bullying players to stay put with threats of lawsuits?
Adding liquidated damage fee clauses to NIL contracts became all the rage in 2025, a year that will be remembered as the first time players have been paid directly by schools. But some experts say such fees cannot be used as a cudgel to punish players that break a contract and transfer.
It’s no surprise that the issue has resulted in a lawsuit — make that two lawsuits — before the calendar flipped to 2026.
Less than a month after Georgia filed a lawsuit against defensive end Damon Wilson II to obtain $390,000 in damages because he transferred to Missouri, Wilson went to court himself, claiming Georgia is misusing the liquidated damages clause to “punish Wilson for entering the portal.”
Wilson’s countersuit in Boone County, Mo., says he was among a small group of Bulldog stars pressured into signing the contract Dec. 21, 2024. The lawsuit also claims that Wilson was misused as an elite pass rusher, that the Georgia defensive scheme called for him to drop back into pass coverage. Wilson, who will be a senior next fall, led Missouri with nine sacks this season.
Georgia paid Wilson $30,000, the first monthly installment of his $500,000 NIL deal, before he entered the transfer portal on Jan. 6, four days after Georgia lost to Notre Dame in a College Football Playoffs quarterfinal.
Bulldogs brass was not pleased. Wilson alleges in his lawsuit that Georgia dragged its feet in putting his name in the portal and spread misinformation to other schools about him and his contractual obligations.
“When the University of Georgia Athletic Association enters binding agreements with student-athletes, we honor our commitments and expect student-athletes to do the same,” Georgia spokesperson Steven Drummond said in a statement after the school filed the lawsuit.
Wilson’s countersuit turned that comment on its head, claiming it injured his reputation because it implies he was dishonest. He is seeking unspecified damages in addition to not owing the Bulldogs anything. Georgia’s lawsuit asked that the dispute be resolved through arbitration.
A liquidated damage fee is a predetermined amount of money written into a contract that one party pays the other for specific breaches. The fee is intended to provide a fair estimate of anticipated losses when actual damages are difficult to calculate, and cannot be used to punish one party for breaking the contract.
Wilson’s case could have far-reaching implications because it is the first that could determine whether schools can enforce liquidated damage clauses. While it could be understandable that schools want to protect themselves from players transferring soon after receiving NIL money, legal experts say liquidated damage fees might not be the proper way to do so.