Shilo Sanders' Bankruptcy, Legal Woes Complicate NIL Story (original) (raw)

University of Colorado safety Shilo Sanders has petitioned a federal bankruptcy court to help him address more than $11 million in debt stemming largely from a civil judgment entered against him in an assault and battery case.

Court records indicate that Sanders—whose brother, Shedeur, and father, Deion, are the Buffaloes’ QB and head coach, respectively—has earned much less in name, image and likeness than some reports estimated.

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The legal controversy began in September 2015, when Sanders was 15 years old. Although the parties dispute many of the facts, John Darjean was working as a security guard at the Focus Learning Center school in Texas. Sanders, a student at the school, refused to turn his cell phone over to Darjean, who told Sanders he was violating a school rule about use of a cell phone.

Sanders argued that Darjean “cornered” him in a school lobby area and then grabbed Sanders’ arm—“hard enough to leave marks”—as he tried to finish a phone call with his mother, Pilar Sanders. Darjean, in contrast, insisted he acted reasonably and in a “rational and non-threatening manner.” Darjean claimed that Sanders physically assaulted him, resulting in “permanent neurological injuries and damage to his cervical spine.”

In 2016, Darjean sued Sanders and his parents for assault and battery in a Dallas County court. The case proceeded slowly and Sanders’ parents were dismissed from the lawsuit. In 2020, Sanders’ attorneys withdrew after Sanders—an undergrad at South Carolina at the time—said he could no longer afford the attorneys.

A trial date was pushed back several times and Sanders claims he wasn’t notified about case developments. A trial was held in 2022 without Sanders’ involvement. The court found Sanders liable, ordering him to pay Darjean $11.89 million. Court records indicate the judgment was not appealed and that no motion for a new trial was filed. Sanders claims he didn’t know about the judgment until 2023, when Darjean’s attorneys undertook collection efforts and sought the judicial appointment of a post-judgment receiver to oversee the collection.

Last October, attorneys for Sanders notified the Dallas court that Sanders had filed a petition for relief under Chapter 7 of the Bankruptcy Code in a federal bankruptcy court in Colorado. The notice was intended to trigger an automatic stay for the collection of debt against Sanders and his property.

The stay is often a major reason for the filing of bankruptcy: It temporarily shields parties with the right to collect debt from access to the debtor, in theory allowing the debtor time to reorganize and improve their finances.

In a filing to the bankruptcy court earlier this year, attorneys for Sanders said that “creation of a post-judgment receivership would have a permanent effect on his ability to start his life after graduation, and would likely result in [Sanders] remaining subject to collection efforts from [Darjean] for the rest of his life.”

They added that bankruptcy relief would allow Sanders “to get a fresh start, free from the oppressive burden of his debts.”

Sanders’ petition to the bankruptcy court indicated he faces two unsecured claims, one from Darjean for 11millionandonefromUticaMutualforabout11 million and one from Utica Mutual for about 11millionandonefromUticaMutualforabout215,000, and a secured property claim from Mercedes-Benz Financial Services of 104,000relatedtoa2023Mercedes.ThepetitionalsostatedthatSandershadearned104,000 related to a 2023 Mercedes. The petition also stated that Sanders had earned 104,000relatedtoa2023Mercedes.ThepetitionalsostatedthatSandershadearned193,713 from January to October 2023, 216,950in2022and216,950 in 2022 and 216,950in2022and17,360 in 2021.

Those income numbers pale in comparison to Sanders’ reported NIL value, which has been estimated as topping $1 million. One recurring criticism of NIL is that valuations sometimes appear based more on conjecture or opportunistic exaggeration than reliable data.

Sanders’ attorneys claim Darjean has violated a protective order, issued in 2018, by disclosing confidential information in Sanders’ bankruptcy case. They claim that last month Darjean uploaded a self-made documentary on YouTube titled “Prime Time for Truth,” and the documentary features “extensive portions of the depositions from the State Court Case subject to the State Court Protective Order.”

Attorneys for Darjean, who has separately sued Sanders in the bankruptcy court, reject this argument, stressing that Sanders publicly filed for bankruptcy last October and insisting that Sanders has violated the protective order through disclosures.

Darjean and Sanders are likely to remain in court for a while as they battle over how Sanders’ bankruptcy could delay and potentially relieve him of the obligation to pay Darjean. It’s also possible that the parties will simply reach a settlement.

Sanders, 24, previously played for South Carolina and Jackson State before transferring to Colorado after his father took the coaching job there following the 2022 season.

Although Sanders is an NFL prospect, his younger brother is a far more heralded one. Shedeur Sanders, 22, is widely expected to be a top pick, possibly the first overall selection, in the 2025 NFL draft. Caleb Williams, the first pick in the 2024 NFL draft, is expected to sign a four-year contract worth $39.5 million, including a 25.5millionsigningbonus.AsforDeionSanders,theformerNFLandMLBplayersignedafive−yearcontractwithColoradoin2022worth[nearly25.5 million signing bonus. As for Deion Sanders, the former NFL and MLB player signed a five-year contract with Colorado in 2022 worth [nearly 25.5millionsigningbonus.AsforDeionSanders,theformerNFLandMLBplayersignedafive−yearcontractwithColoradoin2022worthnearly30 million.