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The Problem with the NFL Concussion Settlement
Author: Scarinci Hollenbeck, LLC
Date: May 17, 2016
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The Problem with the NFL Concussion Settlement
The NFL’s Concussion settlement with former players over the long term effects of concussions has created a stir that The Neurologic Rehabilitation Institute referred to as “a feeding frenzy” among lenders.
Close to five years after the initial legal action on concussions began, the NFL reached a settlement with a number of individuals who once played in the league – and who are now dealing with the health repercussions of their former career. The brief history of the conflict between the league and athletes over the lasting effects of head injuries has been opaque and at times contentious. However, the cognitive setbacks athletes may suffer over time are becoming clearer.
Now the former players, many of whom suffer cognitive issues or physical ailments, are set to collect up to $5 million in payouts from the league. The settlement, historic in sports, has spawned a potentially costly subplot, though.
Lenders offering high-interest pre-settlement payouts
Lenders smell blood in the Gatorade, so to speak. Some have begun offering settlement recipients loans ahead of the payout that include some appealing incentives, The New York Times reported. The loans total tens of thousands of dollars and come without time limits. They’re near-irresistible to the untrained eye with debts to pay and little time to await the NFL’s eventual payout. However, these loans carry interest rates as steep as 40 percent.
When it comes to former athletes depleted of their fortunes with bills to pay and cognition affected by repeated concussions, the more unfavorable details of such a loan may go unnoticed.
The Times found that in the weeks since the Concussion settlement, several former players have acquired such loans against their eventual payouts, which are in purgatory pending the results of a second appeal and the specifics of the deal. The loans’ high interest rates, among other pitfalls, kick in after the funds are doled out and can substantially reduce the payout the athletes ultimately receive. There are over a half-dozen lenders dangling such loans at the moment, and a contingent of retired players interested in their services.
Interest rates raise eyebrows, but interest persists
LaCurtis Jones, a former linebacker who spent a couple of seasons in the NFL, on top of some time playing in Canada, is one of those players interested in a loan. He understands the interest rates are high, but finds it hard to resist using a $100,000 loan to cover child support, his family’s needs and a mentoring program he hopes to start.
“I don’t have none of my money left from the NFL,” Jones told The Times. “I don’t want to get into a lot of debt, but I’m looking for someone to give me some advance money. I don’t need much.”
If you have questions about the concussion settlement or face issues many former NFL players such as Jones do, it may be best to consult a sports law attorney.
For more posts having to do with the NFL, check out:
- An Alternate Route to the NFL – the Regional Scouting Combine
- Self-Representation Could be a Setback in NFL Free Agency
- Unsung Heroes: Life on an NFL Practice Squad
- Industries: Entertainment & Media
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