AN ACT Relating to athlete agents; adding a new chapter to Title 18 RCW; and prescribing penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. This chapter shall be known and may be cited as the Washington athlete agent's licensing act.

NEW SECTION. Sec. 2. The definitions in this section apply through this chapter.

(1) "Agent contract" means any contract or agreement pursuant to which a person authorizes or empowers an athlete agent to negotiate or solicit on behalf of the person with one or more professional sport teams for the employment of the person by a professional sport team or to negotiate or solicit on behalf of the person for the employment of the person as a professional athlete.

(2) "Athlete agent" means a person who, directly or indirectly, recruits or solicits a person to enter into an agent contract or professional sport services contract, or who procures, offers, promises, or attempts to obtain employment for a person with a professional sport team or as a professional athlete.

(3) "Athlete agent firm" means an individual, sole proprietorship, partnership, association, corporation, or other legal entity which employs one or more individuals to act as an athlete agent on behalf of the entity.

(4) "Department" means the department of licensing.

(5) "Director" means the director of licensing.

(6) "Immediate family" means the student athlete's spouse, child, parent, stepparent, or guardian.

(7) "Institution of higher education" means a public or private college or university in this state. "Institution of higher education" includes a community college.

(8) "Licensee" means a person who is licensed under this chapter.

(9) "Person" means an individual, sole proprietorship, partnership, association, corporation, or other legal entity.

(10) "Professional sport services contract" means a contract or agreement pursuant to which a person is employed or agrees to render services as a player on a professional sport team or as a professional athlete.

(11) "Student athlete" means a person who engages in, is eligible to engage in, or may be eligible to engage in any intercollegiate sporting event, contest, exhibition, or program in this state. The term also includes an individual who has applied, is eligible to apply, or who may be eligible to apply in the future to an institution of higher education.

NEW SECTION. Sec. 3. It is unlawful for any person to act as an athlete agent or athlete agent firm without first obtaining a license therefor, and otherwise complying with this chapter.

No suit or action may be brought for the collection of compensation as an athlete agent or athlete agent firm without alleging and proving that the plaintiff was a duly licensed athlete agent or athlete agent firm prior to the time of offering to perform any such act or service or procuring any promise or contract for the payment of compensation for any such contemplated act or service.

Chapter 18.118 RCW does not apply to the licensing of athlete agents and athlete agent firms.

NEW SECTION. Sec. 4. Any person desiring to be an athlete agent or athlete agent firm must pass an examination as provided in this chapter. The person shall make application for an examination and for a license on a form prescribed by the director. Concurrently, the applicant shall:

(1) Pay an examination fee of fifty dollars as directed by the director;

(2) If the applicant is a corporation, furnish a list of its officers and directors and their addresses and, if the applicant is a copartnership, a list of the members thereof and their addresses;

(3) Furnish such proof as the director may require concerning the honesty, truthfulness, and good reputation, as well as the identity, including but not limited to fingerprints, of any applicants for a license, or of the officers of a corporation making the application;

(4) Provide the department with the name and address of the applicant firm and the name or names under which it will do business in this state, as well as the location of its business offices in this state;

(5) Provide the department with the name and address of each owner, partner, officer, and shareholder owning ten percent or more of any stock in the applicant firm and information establishing to the satisfaction of the department that those individuals meet the requirements of this chapter; and

(6) Provide the department with the name and address of each individual who will be authorized by the applicant firm to act as an athlete agent on its behalf and information establishing to the satisfaction of the department that each individual so authorized meets the requirements of this chapter.

NEW SECTION. Sec. 5. (1) The director shall provide each original applicant for a license with a manual containing a sample list of questions and answers pertaining to agency law, contract law, and legal and business ethics and may provide the same at cost to any licensee or to other members of the public. The director shall ascertain by written examination that each applicant has:

(a) Appropriate knowledge of the English language, including reading, writing, spelling, and arithmetic;

(b) An understanding of the principles of agency law, contract law, and legal and business ethics;

(d) An understanding of the obligations between principal and agent;

(e) An understanding of the provisions of this chapter.

(2) All moneys received for the sale of the manual to applicants, licensees, and members of the public shall be placed in the general fund.

NEW SECTION. Sec. 6. Before receiving a license, every athlete agent or athlete agent firm shall pay a license fee of two hundred fifty dollars. Every license issued under this chapter expires on December 31st, which date will henceforth be the renewal date. On or before the renewal date, an annual renewal license fee in the same amount must be paid.

If the application for a renewal license is not received by the director on or before the renewal date, the renewal license fee shall be three hundred dollars. Acceptance by the director of an application for renewal after the renewal date shall not be a waiver of the delinquency.

In order to renew a license, an athlete agent or athlete agent firm shall demonstrate to the department that it is in compliance with this chapter.

An athlete agent representing multiple firms or an athlete agent firm with multiple business locations shall also apply for renewal of all licenses issued.

An athlete agent or athlete agent firm which renews within sixty days after the expiration of a license may be relicensed upon filing all information required for renewal and paying the late renewal fee set forth in this section. A licensee whose license has lapsed for more than sixty days after expiration shall be required to make application as a new licensee, comply with all requirements of this chapter for new applicants, pay the late renewal fee, and demonstrate to the satisfaction of the department that no licensable activity was conducted during the period the license was expired.

The director shall issue to each active licensee a license and a pocket identification card in such form and size as the director prescribes.

NEW SECTION. Sec. 7. (1) If an athlete agent or athlete agent firm's license is revoked by the department, no new license may be issued to the person unless he or she complies with this chapter.

(2) After the revocation of any license, no new license may be issued to the same licensee within a period of at least one year from the date of the revocation nor at any time thereafter except in the sole discretion of the department.

(3) No license may be issued by the department to any person who has been convicted of forgery, embezzlement, obtaining money under false pretenses, extortion, criminal conspiracy, fraud, theft, or other similar offense.

NEW SECTION. Sec. 8. (1) Subject to section 15 of this act, an athlete agent shall provide a cash or surety bond with a principal sum of twenty-five thousand dollars, payable to the people of the state of Washington and conditioned that the individual athlete agent will do all of the following:

(a) Comply with this chapter;

(b) Pay all sums due a person at the time the sums are due and payable; and

(c) Pay all damages occasioned to any person by reason of intentional or unintentional misstatement, misrepresentation, fraud, deceit, or any unlawful or negligent acts, commissions, or omissions of the athlete agent while acting as an athlete agent, or his or her representatives or employees while acting within the scope of their employment, including, but not limited to, a violation of this chapter.

(2) The bond shall be made upon a form provided by the department. A surety bond shall be written by a company recognized and approved by the department to do business in this state. A cash bond shall be provided to the department and deposited with the state treasurer in accordance with the regulations for the deposit of cash bonds.

(3) A bond provided under this section shall not limit or impair a right of recovery otherwise available under the law.

NEW SECTION. Sec. 9. (1) An athlete agent shall file with the department, on a form provided by the department, a disclosure statement which contains all of the following:

(a) The educational background, training, and experience of the athlete agent with respect to practice as an athlete agent;

(b) The business name and addresses of any athlete agent firm represented by the athlete agent, and the license number of the athlete agent and athlete agent firm in this or any other state;

(c) A record of all felony convictions or misdemeanor convictions punishable by imprisonment of the athlete agent and each owner, partner, officer, or shareholder of ten percent or more of the stock of the athlete agent firm represented by the athlete agent; and

(d) A record of any sanctions issued to or disciplinary actions taken against the athlete agent, the athlete agent firm, or any athlete, professional sport team, or institution of higher education as a result of the conduct of the athlete agent or the athlete agent firm.

(2) An athlete agent shall file an updated disclosure statement with the department within thirty days of a change in the information required under subsection (1) (b) or (c) of this section.

(3) Before entering into negotiations for an agent contract or professional sport services contract, an athlete agent shall give to the prospective client a copy of the current disclosure statement on file with the department.

(4) The department shall file with each institution of higher education a copy of the current disclosure statements for all persons who act as athlete agents or athlete agent firms within this state.

NEW SECTION. Sec. 10. (1) An athlete agent firm shall file with the department a copy of each agent contract or professional sport services contract executed by the athlete agent within thirty days after the contact is signed by the client. The contract shall embody all agreements between the parties.

(2) An athlete agent firm shall maintain a complete record of all agent contracts and professional sport services contracts and financial transactions involving those contracts and shall permit the department to inspect those books and records during customary business hours upon request.

(3) An athlete agent or athlete agent firm shall not do either of the following:

(a) Induce a student athlete to enter into an agent contract or professional sport services contact before the student athlete's eligibility for collegiate athletics expires or before the student athlete has declared his or her eligibility will expire; or

(b) Enter into an agreement whereby the athletic agent offers anything of value to an employee of an institution of higher education in return for the referral of a student athlete by that employee.

NEW SECTION. Sec. 11. (1) The department shall review the operations of licensees or persons who may be required to be licensed and shall investigate complaints received. The department may initiate contested case proceedings based on the findings of a departmental investigation.

(2) The department may issue a cease and desist order to any person determined by the department to be doing the following:

(a) Acting as an athlete agent or athlete agent firm without a license under this chapter;

(b) Acting as a licensee in violation of this chapter;

(c) Falsifying an application for licensure, renewal of licensure, or any document required by this chapter, including a disclosure statement; or

(d) Committing fraud, deceit, deception, or making a false statement or misrepresentation designed to deceive or persuade a person to sign or induce another to sign an agent contract or professional sport services contract or to agree to any terms within or outside the contract.

NEW SECTION. Sec. 12. A person who acts as an athlete agent or athlete agent firm within this state without a license or after the suspension or revocation of his or her license is guilty of a class C felony. Upon conviction, the person shall be fined not more than ten thousand dollars or be confined in a state correctional institution for not more than five years.

NEW SECTION. Sec. 13. (1) Except as provided in subsection (3) of this section, a person shall not give, offer, promise, or attempt to give any money or other thing of value to a student athlete or immediate family member of a student athlete to induce, encourage, or reward a student athlete's participation in a professional sport services contract.

(2) A person shall not aid or abet any act described in subsection (1) of this section.

(3) As used in subsection (1) of this section, "person" does not include any of the following:

(a) An institution of higher education or any of its officers or employees if the institution, officer, or employee is acting in accordance with an official written policy of the institution which is in compliance with rules promulgated by the department;

(b) An intercollegiate athletic award approved or administered by the institution of higher education that the student athlete attends; or

(4) Except as provided in subsection (3) of this section, a person who engages in conduct knowing or having reason to know that the conduct is in violation of this section is guilty of a class C felony, punishable by a fine of not more than ten thousand dollars or not more than five years imprisonment, or both.

NEW SECTION. Sec. 14. (1) Except as provided in subsection (2) of this section, a student athlete or member of his or her immediate family shall not solicit or accept money or anything of value for any of the purposes described in section 13 of this act. A person shall not aid or abet any act described in this subsection.

(2) This section does not apply to money or other things of value that a student athlete receives from any of the following:

(a) An institution of higher education, its officers, or employees if the institution, officer, or employee offered money or anything of value in accordance with an official written policy of the institution which is in compliance with rules promulgated by the department;

(b) An intercollegiate athletic award approved or administered by that institution; or

(3) Except as provided in subsection (2) of this section, a person who engages in conduct knowing or having reason to know that the conduct violates this section is guilty of a gross misdemeanor punishable by a fine of not more than five thousand dollars.

NEW SECTION. Sec. 15. Pursuant to chapter 34.04 RCW, the department may assess one or more of the following penalties against a person who violates this chapter or a rule promulgated under this chapter:

(1) Revocation of a license;

(2) Suspension of a license;

(3) Imposition of a civil fine of up to ten thousand dollars for each offense;

(4) Denial, for a specified time, of a license or the renewal of a license;

(5) A requirement that restitution be made;

(6) Issuance of a license with special conditions, limitations, or requirements;

(7) Issuance of a written reprimand or letter of censure as a part of the permanent record of a licensee. However, the final order shall stipulate a time following which a person may petition the department to remove the reprimand or censure from the file;

(8) Issuance of a cease and desist order; or

(9) Imposition of a requirement that the bond required by this chapter be increased and maintained for a specific period of time.

NEW SECTION. Sec. 16. (1) In addition to the penalties prescribed in section 15 of this act, a person who does any of the following is guilty of a class C felony, punishable by imprisonment for not more than five years, a fine of not more than ten thousand dollars, or both:

(a) Acts as or offers to act as an athlete agent or athlete agent firm without a license under this chapter; or

(b) Interferes with, impedes, or obstructs an investigation conducted by the department under this chapter.

(2) The department or the attorney general may petition a court to issue a subpoena which shall require the person subpoenaed to appear or produce relevant documentary material for examination during the conduct of an investigation or at a proceeding conducted by the department under the administrative procedure act, chapter 34.04 RCW.

(3) The department or the attorney general may petition a court for injunctive relief or other remedies at law to enforce orders of the department, this chapter, and rules promulgated under this chapter.

NEW SECTION. Sec. 17. Any athlete agent or student athlete who violates this chapter may be required to make restitution to the institution of higher education for any damages suffered as a result of the violation.

NEW SECTION. Sec. 18. The department shall promulgate rules to implement this chapter, pursuant to chapter 34.04 RCW.

NEW SECTION. Sec. 19. Sections 1 through 18 of this act shall constitute a new chapter in Title 18 RCW.