Doesn't anybody else here read r/cfb?

https://www.reddit.com/r/CFB/comments/1bimyt6/clemson_university_files_lawsuit_against_the_acc/

TL;DR

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Accordingly, Clemson seeks a declaration from this court that: (i) the media rights Clemson granted to the ACC do not include any Clemson games that are played after Clemson ceases to be a member of the ACC; (ii) Clemson is not required to pay the ACC the withdrawal penalty, as such a payment is an unenforceable penalty in violation of public policy; and (iii) Clemson owes no fiduciary duties to the ACC or its other members and has breached no legal duty or obligation it might owe to the ACC by filing this lawsuit.

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Seems like a grant of rights is just that. Clemson granted their rights to the ACC. Their argument may be valid in that they can leave the ACC without penalty, but all of their games, through the end of the contract, are the right of the ACC to broadcast, so that means they can't be a part of any competition that is published/broadcast unless the ACC allows it.

Good luck playing in the SEC or the Big 10 against teams in games that cannot be televised until the 2030s, anywhere, at any time, without the express written consent of the ACC!

Maybe this is different in some way from FSU's suit, but right now it looks about the same.

The argument really is just, "Those teams left the Pac-12 for the Big Ten without paying anything, so we should be able to leave the ACC without paying anything."

Who knows, maybe if they pay enough to some judge, they can win with that argument.

BearSD said:

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The argument really is just, "Those teams left the Pac-12 for the Big Ten without paying anything, so we should be able to leave the ACC without paying anything."

Who knows, maybe if they pay enough to some judge, they can win with that argument.

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The pac12 teams didn't bail on a contract, they were discussing a new one and couldn't get it done. Acc has a long term contract in force.

Would not surprise me if they try to shift this case to a drive thru judiciary somewhere that is obviously run by a trumplican with a jd from either one of those crappy schools or the university of Phoenix.
And the original jurisdiction will allow it because they're tired of ruling frivolous over and over again on meritless proud boys and misifristinone cases.
Sad state of democracy when a bunch of obese ginger beards can bend the law whichever way they choose by installing hacks to the bench.

"[O]bese ginger beards" sounds like a dessert found in most Southern high end restaurants.

Does anybody here really think FSU and Clemson will be playing in the ACC within the next three years?

kasaja said:

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Does anybody here really think FSU and Clemson will be playing in the ACC within the next three years?

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Fitty-fitty, the ACC exists in three years.

CS/A(scholar/athlete)FL Championship or Cup level.

kasaja said:

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Does anybody here really think FSU and Clemson will be playing in the ACC within the next three years?

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I agree - hard to imagine things just stay locked in given how badly these guys want out. But we keep hearing about thee ACC GOR being ironclad. Not sure what breaks.

kasaja said:

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Does anybody here really think FSU and Clemson will be playing in the ACC within the next three years?

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Yes, I do. I think that is the most likely outcome, I think they will lose in court, then make the expanded CFP, realize they have a better path in the ACC than in the SEC and simmer down, with a lot of whining of course.

Plus ESPN is not putting up the money for the SEC to get them so they pay more, and in fact helped orchestrate the deal to bring Cal, Furd and SMU in.

There is an outside chance Fox wants them in the B1G and would help fund the buyout, but Fox is not rolling in cash. More importantly, neither school is an AAU member so I highly doubt the B1G presidents want them. Miami is an AAU member, as is Florida, so maybe some kind of swap….. no, I don't see it. It is a very safe bet they are not going anywhere and we will just have to hear them complain about it for years.

The FSU/Clemson vs. ACC cases seem to me, a layperson, to be:

-- Yes, we voluntarily signed a contract 8 years ago to sell you our house. But we think we could get a much better deal today. So, you have to give us back our house.

Hopefully they have better lawyers than me.

— Stewart Mandel (@slmandel) March 19, 2024

BearSD said:

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The FSU/Clemson vs. ACC cases seem to me, a layperson, to be:

-- Yes, we voluntarily signed a contract 8 years ago to sell you our house. But we think we could get a much better deal today. So, you have to give us back our house.

Hopefully they have better lawyers than me.

— Stewart Mandel (@slmandel) March 19, 2024

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Hopefully they don't!

UNC BOT weighs in. So now all 3 "no" votes are throwing a tantrum, although UNC still hasn't put its chips down with a filing.

https://old.reddit.com/r/CFB/comments/1bjw7b7/insidecarolinaunc_board_of_trustees_chair/

WalterSobchak said:

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UNC BOT weighs in. So now all 3 "no" votes are throwing a tantrum, although UNC still hasn't put its chips down with a filing.

https://old.reddit.com/r/CFB/comments/1bjw7b7/insidecarolinaunc_board_of_trustees_chair/

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I read that a bit differently from how the redditors read it. Looks to me like the UNC guy is nervously wondering whether FSU or Clemson has something lined up with the Big Ten or SEC, or whether they merely filed lawsuits in the hope of attracting offers from the Big Ten or SEC, and he wants them to put their cards on the table so he knows exactly where everyone stands. Of course they won't do him that favor.

WalterSobchak said:

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UNC BOT weighs in. So now all 3 "no" votes are throwing a tantrum, although UNC still hasn't put its chips down with a filing.

https://old.reddit.com/r/CFB/comments/1bjw7b7/insidecarolinaunc_board_of_trustees_chair/

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My understanding is the BOT has no power. They serve in an "advisory" role to the UNC Board of Governors on matters pertaining to the Chapel Hill campus and to the Chancellor, who answers to the BOG, not the BOT. The chancellor and the AD have been far more supportive of the ACC. That said, they did vote against us, but I think for other reasons. UNC is mired in political/culture war fights (the US Supreme Court struck down their DEI programs) and the chancellor departed for Michigan State with a BOG member (a Duke grad with no academic background) installed as interim chancellor in January.

UNC Board of Truststees Chair wants UNC out of the ACC. But fortuantely the UNC System recently granted itself the power to decide whether UNC System schools (UNC and NC State) change conferences, conceivably tying the two schools together and making the disintegration of the ACC less likely. NC State to the rescue again?

https://www.wralsportsfan.com/unc-system-power-conference-moves-unc-nc-state/21226287/

scibear said:

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UNC Board of Truststees Chair wants UNC out of the ACC. But fortuantely the UNC System recently granted itself the power to decide whether UNC System schools (UNC and NC State) change conferences, conceivably tying the two schools together and making the disintegration of the ACC less likely. NC State to the rescue again?

https://www.wralsportsfan.com/unc-system-power-conference-moves-unc-nc-state/21226287/

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They seem to be trying to avoid a Cal/UCLA split result. Reminds me of when Texas almost joined the Pac, but Texas politicians demanded the Pac take another Texas school as well, and the Pac said no. In retrospect, yet another error in judgment by Scott and the Pac CEOs.

Clemson's decision to enter the legal party is because it sees itself slipping further behind teams in the SEC and B1G. And its the timespan that is a factor. They are looking at this in a 2-3 year timetable in terms of how far behind they will be.

Consider that ESPN just struck a deal with the CFP starting in 2026. The deal clearly benefits the SEC and B1G and not the ACC and B12.The B1G and SEC will each receive 29% of the $1.3 billion annual payout from the network. Teams are going to see their payouts quadruple from the current figure to the tune of $21 million to $23 million.

The ACC and Big 12 will get 17.1% and 14.7% of the distribution. This is what Clemson is looking at. It makes the revenue gap even worse. ACC schools will receive about $7 million to $10 million less than teams in the SEC and B1G. Within three years, media consultants are projecting that the Big Ten and SEC schools will possibly be earning nearly double ($80M-$90M) in annual conference distribution as those in the ACC and Big 12 ($45M-$50M). This is based on tv revenue.

The one interesting thing to consider is: as this gap widens, between SEC/B1G and ACC/B12, it becomes more and more apparent that any attempt at leaving the ACC with an exit fee and a media release somewhere between $200-300 million, would be considered punitive. A penalty. The ACC insists that no penalty exists.

I still think that FSU and Clemson are aiming for settlement. Now, if UNC and NC State file a lawsuit or join one of the other two - I think it signals the end.

philly1121 said:

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Clemson's decision to enter the legal party is because it sees itself slipping further behind teams in the SEC and B1G. And its the timespan that is a factor. They are looking at this in a 2-3 year timetable in terms of how far behind they will be.

Consider that ESPN just struck a deal with the CFP starting in 2026. The deal clearly benefits the SEC and B1G and not the ACC and B12.The B1G and SEC will each receive 29% of the $1.3 billion annual payout from the network. Teams are going to see their payouts quadruple from the current figure to the tune of $21 million to $23 million.

The ACC and Big 12 will get 17.1% and 14.7% of the distribution. This is what Clemson is looking at. It makes the revenue gap even worse. ACC schools will receive about $7 million to $10 million less than teams in the SEC and B1G. Within three years, media consultants are projecting that the Big Ten and SEC schools will possibly be earning nearly double ($80M-$90M) in annual conference distribution as those in the ACC and Big 12 ($45M-$50M). This is based on tv revenue.

The one interesting thing to consider is: as this gap widens, between SEC/B1G and ACC/B12, it becomes more and more apparent that any attempt at leaving the ACC with an exit fee and a media release somewhere between $200-300 million, would be considered punitive. A penalty. The ACC insists that no penalty exists.

I still think that FSU and Clemson are aiming for settlement. Now, if UNC and NC State file a lawsuit or join one of the other two - I think it signals the end.

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Of course they are doing this because of the money going to the SEC/B1G and of course they want a settlement.

I still don't know why the rest of the ACC would want to settle, at least for now. When it's closer to the end of the contract term, sure.

I hope they don't come after our seven million dollar bonanza.

sycasey said:

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philly1121 said:

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Of course they are doing this because of the money going to the SEC/B1G and of course they want a settlement.

I still don't know why the rest of the ACC would want to settle, at least for now. When it's closer to the end of the contract term, sure.

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Exactly. The entire conference would have to approve any potential settlement, and no one has yet suggested potential settlement terms that would be in the best interests of the other members.

First and foremost, the enforceability of liquidated damages provisions is based on two* factors:

1) are actual damages difficult or impossible to quantify; and
2) are the liquidated damages a reasonable approximation of what actual damages would be.

So the relevant inquiry is how much the ACC (and its non-departing members) would be damaged by the leaving member(s), not the increased amount any member wanting to leave thinks it is being prevented from obtaining.

Take the PAC as an example: Even before they left it was clear that USC and Ucla leaving would have some detrimental impact on the value the remaining PAC members would be able to command on the open market for their remaining media rights, but the amount of that diminution in value was very difficult to predict until they actually attempted to market those rights. When they did, it became very obvious that the diminution was significant. $100M to $200M? Yeah, probably more actually. Nobody predicted at the time of their announcements that the entire PAC would essentially become insolvent and break apart. In fact the more value USC and Ucla were able to get elsewhere the higher the liquidated damages could have been and still have been "reasonable" because it would be actual evidence of the value they removed from the PAC. Maybe not dollar for dollar, but it would at least provide a ballpark. The PACs demise would've just been the equitable cherry on top of the remaining members' argument.

Now the PAC and ACC situations are fundamentally different because USC and Ucla waited for the PAC GOR to expire so there would be no damages. But there's another important thing to remember here: Even if the ACC liquidated damages provision is unreasonable and thus deemed penalty, nothing in that determination would preclude the ACC remaining members from seeking ACTUAL damages from the leaving member(s). The argument would simply shift to establishing those damages. But make no mistake there would be actual damages caused by members leaving now, and those actual damages could potentially be catastrophic as we saw with the PAC. And again, the more they get somewhere else the more they removed from the ACC.



*Sometimes a third factor, whether the parties intended the payment(s) to be treated as liquidated damages, also applies but that doesn't appear to be the case in any of these states and would likely be easily met at any rate because the GOR expressly refers to them as such.

BearSD said:

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sycasey said:

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Of course they are doing this because of the money going to the SEC/B1G and of course they want a settlement.

I still don't know why the rest of the ACC would want to settle, at least for now. When it's closer to the end of the contract term, sure.

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Exactly. The entire conference would have to approve any potential settlement, and no one has yet suggested potential settlement terms that would be in the best interests of the other members.

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I mean, if FSU and Clemson are willing to pay everyone else a s***load of money just to get out super early, then sure that might work. But it doesn't seem like they would want to do that or could afford that.

sycasey said:

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BearSD said:

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sycasey said:

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Of course they are doing this because of the money going to the SEC/B1G and of course they want a settlement.

I still don't know why the rest of the ACC would want to settle, at least for now. When it's closer to the end of the contract term, sure.

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Exactly. The entire conference would have to approve any potential settlement, and no one has yet suggested potential settlement terms that would be in the best interests of the other members.

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I mean, if FSU and Clemson are willing to pay everyone else a s***load of money just to get out super early, then sure that might work. But it doesn't seem like they would want to do that or could afford that.

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That's literally what the GOR says. It doesn't say they can't leave, it just says if they do this is how much they have to pay. If they leave early and destroy the ACC they're going to pay damages one way or another. Of course they want to settle. They want to pay pennies on the dollar of what they agreed to. That's it. That's all this is or has ever been about.

WalterSobchak said:

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sycasey said:

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BearSD said:

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sycasey said:

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Of course they are doing this because of the money going to the SEC/B1G and of course they want a settlement.

I still don't know why the rest of the ACC would want to settle, at least for now. When it's closer to the end of the contract term, sure.

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Exactly. The entire conference would have to approve any potential settlement, and no one has yet suggested potential settlement terms that would be in the best interests of the other members.

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I mean, if FSU and Clemson are willing to pay everyone else a s***load of money just to get out super early, then sure that might work. But it doesn't seem like they would want to do that or could afford that.

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That's literally what the GOR says. It doesn't say they can't leave, it just says if they do this is how much they have to pay. If they leave early and destroy the ACC they're going to pay damages one way or another. Of course they want to settle. They want to pay pennies on the dollar of what they agreed to. That's it. That's all this is or has ever been about.

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There is a reason they haven't just left. The departing schools want to know what is will cost them and gauge if that it is too steep a cost. if the cost is what the FSU lawyers for FSU said (close to $600 million), no-one is leaving, though their FSU filing was not a credibility building exercise, and did a disservice to their client.

I doubt the other schools in the ACC would have a say-so in that. That would be arbitrary and actually would constitute a penalty. The ACC doesn't believe that there is a "penalty" in play here. If the ACC were to base leaving on damages incurred for lost income, I don't think that would fly. Its nearly the same argument put forward by us when UCLA left. I don't see much talk anymore about Calimony anymore.

Any penalty or damages requested by the other universities would likely trigger litigation between the departing schools and the schools that are left. There's no way they would wade into that.

WalterSobchak said:

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sycasey said:

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BearSD said:

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sycasey said:

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Of course they are doing this because of the money going to the SEC/B1G and of course they want a settlement.

I still don't know why the rest of the ACC would want to settle, at least for now. When it's closer to the end of the contract term, sure.

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Exactly. The entire conference would have to approve any potential settlement, and no one has yet suggested potential settlement terms that would be in the best interests of the other members.

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I mean, if FSU and Clemson are willing to pay everyone else a s***load of money just to get out super early, then sure that might work. But it doesn't seem like they would want to do that or could afford that.

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That's literally what the GOR says. It doesn't say they can't leave, it just says if they do this is how much they have to pay. If they leave early and destroy the ACC they're going to pay damages one way or another. Of course they want to settle. They want to pay pennies on the dollar of what they agreed to. That's it. That's all this is or has ever been about.

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I think what the GORs literally says is the broadcast rights for Florida State and Clemsen belong to the ACC. So even if the schools left the ACC and joined the SEC, the rights to broadcast their games belongs to the ACC so the ACC would receive that revenue.

calumnus said:

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WalterSobchak said:

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sycasey said:

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BearSD said:

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sycasey said:

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Of course they are doing this because of the money going to the SEC/B1G and of course they want a settlement.

I still don't know why the rest of the ACC would want to settle, at least for now. When it's closer to the end of the contract term, sure.

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Exactly. The entire conference would have to approve any potential settlement, and no one has yet suggested potential settlement terms that would be in the best interests of the other members.

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I mean, if FSU and Clemson are willing to pay everyone else a s***load of money just to get out super early, then sure that might work. But it doesn't seem like they would want to do that or could afford that.

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That's literally what the GOR says. It doesn't say they can't leave, it just says if they do this is how much they have to pay. If they leave early and destroy the ACC they're going to pay damages one way or another. Of course they want to settle. They want to pay pennies on the dollar of what they agreed to. That's it. That's all this is or has ever been about.

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I think what the GORs literally says is the broadcast rights for Florida State and Clemsen belong to the ACC. So even if the schools left the ACC and joined the SEC, the rights to broadcast their games belongs to the ACC so the ACC would receive that revenue.

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Sorry, you're right, I misremembered. The liquidated damages provision is in the ACC Constitution not the GOR.

Quote:

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1.4.5 Withdrawal of Members.
To withdraw from the Conference, a Member must file an official notice of withdrawal with each of the Members and the Commissioner on or before August 15 for the withdrawal to be effective June 30 of the following year.

Upon official notice of withdrawal, the Member will be subject to a withdrawal payment, as liquidated damages, in an amount equal to three times the total operating budget of the Conference (including any contingency included therein), approved in accordance with Section 2.5.1 of the Bylaws of the Conference (the "Bylaws"), which is in effect as of the date of the official notice of withdrawal. The Conference may offset the amount of such payment against any distributions otherwise due such Member for any Conference year. Any remaining amount due shall be paid by the withdrawing Member within 30 days after the effective date of withdrawal. The withdrawing Member shall have no claim on the assets, accounts, or income of the Conference.

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According to the ACC, damages from an undisclosed member withdrawing were estimated by an outside media consultant to potentially exceed $200M in 2012 dollars and only for some media rights.

Quote:

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39. On July 8, 2010, the ACC entered into its first Multi-Media Agreement with ESPN ("2010 Multi-Media Agreement") with the unanimous approval of its Member Institutions (including Clemson). Under the 2010 Multi-Media Agreement, the ACC granted ESPN the exclusive distribution rights to home or Conference-controlled Football Games, Men's Basketball Games, Women's Basketball Games, and Olympic Sports.

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41. In 2012, through an Amendment and Extension Agreement, the ACC and ESPN agreed to extend the term of the 2010 Multi-Media Agreement until 2027, increasing the [REDACTED] to be paid such that, by the end of the term, ESPN would pay the ACC (for distribution to its Member Institutions) [REDACTED] annually.

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44. Following the approval of the 2010 Multi-Media Agreement, the Conference revised the withdrawal payment and alternative performance that a withdrawing Member must make if it chose to leave the Conference.

45. During a meeting of the Council of Presidents (now Board of Directors) on September 11-12, 2012, there was extensive discussion concerning whether the withdrawal payment and alternative performance should be increased to better protect the Conference from the potential negative impact that a withdrawal of a Member could cause, as well as to more appropriately compensate the Conference for some of the potential losses.

46. During this meeting, a media consultant provided information concerning the potential lost revenue to the Conference in the event a Member withdrew. That assessment indicated that the lost revenue in 2012 could range from $6 Million to $18 Million per year depending on the identity of the withdrawing Member -- and that these losses would occur over then 12-year life of the Media agreement, for a total of $72 Million to over $200 Million. These projected losses only reflected the loss of certain Media Rights payments.

47. The Council of Presidents further discussed the fact that other losses would also occur if a Member withdrew, ranging from NCAA Men's Basketball Tournament revenues (which are distributed over time on a unit basis), the potential inability to honor bowl agreements, lost revenues on individual campuses from ticket sales, and the harm to the Conference's reputation, image, and national brand.

48. Given the extent of potential loss if a Member withdrew, and while a recommendation was made to increase the amount of the withdrawal payment from 1-1/4 to 3 times the Conference's annual operating budget, this increase was still insufficient to address the potential losses caused by withdrawal.

49. As a result of these discussions, the Council of Presidents, including Clemson's then-President, voted to increase the withdrawal payment to 3 times the Conference's annual operating budget.

50. Thus, the withdrawal payment is simply a vehicle through which a Member may choose to terminate its membership in the Conference by meeting the payment obligations rather than continuing to meet the obligations of a Member. It thus constitutes a form of alternate performance under the ACC Constitution and Bylaws and represents a fraction of the losses that would be caused to the Conference by the withdrawal of a Member.

51. The withdrawal payment, which is meant to provide an alternative means of performance for a Member who seeks to withdraw, is less than a single year of the athletic revenues generated by Clemson. In the context of agreements that will last several years and generate hundreds of millions of dollars, the withdrawal payment is a fraction of the total revenue to be paid to the Conference and received by its Members.

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Can someone who has a twitter account post the hearing threads from today by https://twitter.com/RohanLawPC and https://twitter.com/ADavidHaleJoint ? I don't have twitter so everything is randomly sorted for me, not chronological. Most interested to know if there were any rulings or if everything was taken under submission. Also saw a reference online that Cal, Stanford, and SMU "is an option and not an agreement for the ESPN agreement." Not sure what that means.

WalterSobchak said:

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Can someone who has a twitter account post the hearing threads from today by https://twitter.com/RohanLawPC and https://twitter.com/ADavidHaleJoint ? I don't have twitter so everything is randomly sorted for me, not chronological. Most interested to know if there were any rulings or if everything was taken under submission. Also saw a reference online that Cal, Stanford, and SMU "is an option and not an agreement for the ESPN agreement." Not sure what that means.

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Hale says everything was taken under submission. FSU wants everything to be decided in Florida by a judge they bought and paid for; ACC wants everything decided in Charlotte where the conference is headquartered. So, nothing new today.

FSU's motion to dismiss or stay North Carolina case is denied

Meanwhile in the FL case:

https://247sports.com/college/florida-state/article/fsus-additional-reply-to-accs-motion-to-dismiss-or-stay-in-florida-the-entire-acc-enterprise-has-failed-229888801/

WalterSobchak said:

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FSU's motion to dismiss or stay North Carolina case is denied

Meanwhile in the FL case:

https://247sports.com/college/florida-state/article/fsus-additional-reply-to-accs-motion-to-dismiss-or-stay-in-florida-the-entire-acc-enterprise-has-failed-229888801/

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Can a lawyer please comment on this? It seems to this layman that they're looking for any excuse to move the case to Florida where their golfing buddy will give them a favorable decision.

IMO all 3 courts are likely to rule venue is proper in their jurisdiction. While there is definitely some conflict of interest based on where these judges went to school, I honestly don't think that would really change much in this particular case because IMO it's overshadowed by how much judges typically love presiding over high profile cases in general.