The NCAA is the private organization. The State of California, by enacting this law, is telling the NCAA that they can't punish any players or schools for allowing the players to receive money for endorsements or use of their likeness, etc. They way it could be argued by the NCAA - By being members, the schools have entered into a contract with the NCAA that they won't allow the payments and the State is interfering with that contract by saying that the players can get money. This type of state action was barred in 1819 by the Supreme Court's decision in Trustees of Dartmouth College v. Woodward., based on the contracts clause of the Constitution (Article 1, Section 10, clause 1), "No State shall ... pass any ... Law impairing the Obligation of Contracts ..." Daniel Webster, an alum, represented Dartmouth.
The law should be thrown out on its face, without arguments or briefs.