Thank you for the excellent update Nick. These cases are both interesting from a legal perspective (and your presentation makes them more so), and from this Clemson fan's perspective. I also do not want to see FSU and Clemson leave the ACC. Cal, et al. is a welcome addition, adding an interesting dynamic to the conference and I look forward to watching those games.
I see a couple people giving kudos to Nick (and I always appreciate his work), but isn't it TwistNHook who is writing the articles with Nick posting on his behalf?
Out of curiosity, what do you think the ACC's long-term play is if they win this case? Best case scenario, the Court rules that FSU and Clemson have a GOR that is locked in for at least the value of the ESPN deal until 2036 plus exit fees, and this ruling magically comes down pe-February 2025, and ESPN exercises its option with no strings attached until 2036 as originally hoped for. What next?
The ACC's two most profitable brands in the biggest money making sport are pissed, and bridges are burned on both sides. As time goes on over the next 10 years, it just will mean they leave in 2036 for nothing. Its not like the ACC would eject those two schools, they are the reason for much of the media deal. So, like it or not, the ACC is dependent on those two schools. So, what is the long-term play? If nothing else is clear, there is no chance they stay beyond 2036 under the current deal. I am not saying the ACC can settle, I just do not get where the ACC thinks this is going to go. I can tell you right now, FSU's alumni base will not stomach staying in this conference past 2036. Without FSU and Clemson in the conference, what do you think the media deal would be? Not much... its why the ACC is fighting so hard now. ACC is in a bad spot. Not sure I see a good outcome. The ACC's best bet was to play ball with them last Spring and give unequal revenue shares... they chose not to then. Then in the summer, rather than shift all of the money from the new schools to FSU/Clemson/UNC/UM (which made the most sense as the bread winners), they gave those shares to schools like Wake and BC... The ACC spends more time appeasing Wake and BC than they should... it is probably one of the biggest gripes in the last 30 years from FSU... the appeasement of the NC schools. It is why they moved the ACC Football championship from Florida to NC. It is why they push most of the men's tournament games there... NC schools rule the roost in the ACC. Welcome to the ACC (the "All Carolina Conference").
First, I want to thank you for your professional tone. As a practicing attorney, I appreciate a well toned and thoughtful opposing viewpoint. I actually at times get exhausted on many forums from other schools and those on FSU fan sites with people not understanding much of what is going on, and trying to compare it to a football game. I have even heard alleged attorneys on both sides make very silly statements about things that clearly come from a biased perspective. When the judge on Monday dismissed without prejudice the FSU complaint, to let them amend and refile, the tone I saw online was borderline insane from the pro-ACC crowd. I heard people saying "FSU cannot even get its filing right..." or "their complaint was horrible, this proves they are idiots..." People act as if the collective body of alumni at FSU got together and drafted the complaint. The law firm representing FSU in Florida, Greenberg Traurig, is one the big boy firms world-wide, and the three attorneys of record for them went to FSU, Duke and Emory law. These guys are very good, and it is not like some FSU Frat guy coughed out a complaint. They will refile, and it actually may be a good thing in the end, as they can now add in additional elements into their filing that will bolster things even more, and address the personal jurisdiction issue.
Anyway, in the end, the real decider in all of this, in my view is less these cases, and more the ticking clock on the ESPN deal. Where I disagree with you is the fact you do not think the ACC likely settles unless FSU succeeds in its appeal. You could argue there is no circumstances the ACC settles until February 2025. As we now know via the FSU filing, Jim Phillips granted ESPN an extension until February of 2025 to extend the current ESPN deal beyond the end of 2026 and to make it last until 2036. So far, ESPN has not exercised that option, and the current ESPN deal will expire at the end of 2026 into 2027, if ESPN does nothing by February 2025. That is about 9ish months away, a pregnancy term. ESPN has not exercised its option, and the reason is unknown. The reason is crucial to understanding whether or not a settlement can be reached.
I can think of 3 reasons why they are not extending, and depending on which one, will dictate if the ACC and FSU/Clemson can settle or not.
Before explaining the reasons, let me explain that one of the best arguments FSU has in lowering the GOR buyout is that the ESPN deal is mentioned in the GOR expressly and potentially is thus linked as part of that GOR deal, and until the option is exercised, the ESPN deal ends not in 2036 but in 2027, and arguably so should the GOR if the option is not exercised since the GOR as drafted by the ACC expressly mentions the ESPN deal by name. It almost is the consideration in the GOR deal. I only mention this because this impacts Scenario/Reason 2 below (the second reason ESPN may not be extending the deal).
Potential Reason 1, on why ESPN has not Extended - The most logical answer might be, they will not extend until FSU and Clemson are locked in. Well if that is true, the ACC is in a jam, because if they settle, the ESPN deal goes bye bye, and even if those schools paid a billion, is still does not equal the value of the ESPN deal through 2036 if extended. So that means, the ACC has to win and likely has to win fast and does not want this to drag on, or they are screwed anyways. No other media outlet will come in and replace ESPN either under that scenario. This is a bad spot to be if this is the reason, because it is a stand-off then. FSU/Clemson want out, ESPN will not extend without them locked in, and the ACC can't settle or they lose the deal.
Potential Reason 2 - What if the reason ESPN is not extending is due to the fact the ACC added 3 schools without running it by ESPN last summer to trigger the pro-rata clause in the ESPN deal, and then took most of their shares and artificially inflated pay-outs of the rest of the schools? That would piss off ESPN, because what is to stop the ACC from doing that again under the deal with other schools after ESPN extends? The pro-rata share clause does not appear to have a limit. Well if that is all true, ESPN could be hesitant in extending beyond 2026, because their budget is unknown. Schools could continue to be added. Anyway, if this is the reason, then the ACC may want to settle so it can freely amend the ESPN deal and not risk impacting the FSU/Clemson deal for materially changing the contract. It cannot try to amend the ESPN deal in current litigation since it is mentioned in the GOR the schools are suing over... that would not go over well. I could only imagine how the judge would react if the ACC says "Your honor we made some changes to the ESPN deal, but it has no outcome on this case..." No bueno!
Potential Reason 3 - What if the reason ESPN is not extending has nothing to do with the above, but because they are overextended in the CFP deal and purchasing the NFL network and the upcoming NBA deal, etc.? If this is the reason, then I think there is less chance of a quick settlement, because no matter what FSU/Clemson do, the ESPN deal is already dead, although I think the ACC would have better leverage to settle now than 10 months from now and no ESPN deal.
Anyway, my point is, you did not really cover the Extension Issue much, and frankly, that is a huge part of whether or not this can or will be settled. Also, if the deal is not extended, and these cases are still in Court, that will not go well for the ACC. I think you underestimate that the clock is really not in the ACC's favor here.
Agree with Neil from Clemson — a good sport, obviously — and just HAVE to say great job choosing photos. Two Seminole dudes all glittered up yet looking so sullen; how do you find these gems?!
Thank you for the excellent update Nick. These cases are both interesting from a legal perspective (and your presentation makes them more so), and from this Clemson fan's perspective. I also do not want to see FSU and Clemson leave the ACC. Cal, et al. is a welcome addition, adding an interesting dynamic to the conference and I look forward to watching those games.
The amount of passion and work you’ve put in for these analyses are greatly appreciated. Thanks, Nick!
Let’s drag these suits on through 2036(?).
I see a couple people giving kudos to Nick (and I always appreciate his work), but isn't it TwistNHook who is writing the articles with Nick posting on his behalf?
Out of curiosity, what do you think the ACC's long-term play is if they win this case? Best case scenario, the Court rules that FSU and Clemson have a GOR that is locked in for at least the value of the ESPN deal until 2036 plus exit fees, and this ruling magically comes down pe-February 2025, and ESPN exercises its option with no strings attached until 2036 as originally hoped for. What next?
The ACC's two most profitable brands in the biggest money making sport are pissed, and bridges are burned on both sides. As time goes on over the next 10 years, it just will mean they leave in 2036 for nothing. Its not like the ACC would eject those two schools, they are the reason for much of the media deal. So, like it or not, the ACC is dependent on those two schools. So, what is the long-term play? If nothing else is clear, there is no chance they stay beyond 2036 under the current deal. I am not saying the ACC can settle, I just do not get where the ACC thinks this is going to go. I can tell you right now, FSU's alumni base will not stomach staying in this conference past 2036. Without FSU and Clemson in the conference, what do you think the media deal would be? Not much... its why the ACC is fighting so hard now. ACC is in a bad spot. Not sure I see a good outcome. The ACC's best bet was to play ball with them last Spring and give unequal revenue shares... they chose not to then. Then in the summer, rather than shift all of the money from the new schools to FSU/Clemson/UNC/UM (which made the most sense as the bread winners), they gave those shares to schools like Wake and BC... The ACC spends more time appeasing Wake and BC than they should... it is probably one of the biggest gripes in the last 30 years from FSU... the appeasement of the NC schools. It is why they moved the ACC Football championship from Florida to NC. It is why they push most of the men's tournament games there... NC schools rule the roost in the ACC. Welcome to the ACC (the "All Carolina Conference").
First, I want to thank you for your professional tone. As a practicing attorney, I appreciate a well toned and thoughtful opposing viewpoint. I actually at times get exhausted on many forums from other schools and those on FSU fan sites with people not understanding much of what is going on, and trying to compare it to a football game. I have even heard alleged attorneys on both sides make very silly statements about things that clearly come from a biased perspective. When the judge on Monday dismissed without prejudice the FSU complaint, to let them amend and refile, the tone I saw online was borderline insane from the pro-ACC crowd. I heard people saying "FSU cannot even get its filing right..." or "their complaint was horrible, this proves they are idiots..." People act as if the collective body of alumni at FSU got together and drafted the complaint. The law firm representing FSU in Florida, Greenberg Traurig, is one the big boy firms world-wide, and the three attorneys of record for them went to FSU, Duke and Emory law. These guys are very good, and it is not like some FSU Frat guy coughed out a complaint. They will refile, and it actually may be a good thing in the end, as they can now add in additional elements into their filing that will bolster things even more, and address the personal jurisdiction issue.
Anyway, in the end, the real decider in all of this, in my view is less these cases, and more the ticking clock on the ESPN deal. Where I disagree with you is the fact you do not think the ACC likely settles unless FSU succeeds in its appeal. You could argue there is no circumstances the ACC settles until February 2025. As we now know via the FSU filing, Jim Phillips granted ESPN an extension until February of 2025 to extend the current ESPN deal beyond the end of 2026 and to make it last until 2036. So far, ESPN has not exercised that option, and the current ESPN deal will expire at the end of 2026 into 2027, if ESPN does nothing by February 2025. That is about 9ish months away, a pregnancy term. ESPN has not exercised its option, and the reason is unknown. The reason is crucial to understanding whether or not a settlement can be reached.
I can think of 3 reasons why they are not extending, and depending on which one, will dictate if the ACC and FSU/Clemson can settle or not.
Before explaining the reasons, let me explain that one of the best arguments FSU has in lowering the GOR buyout is that the ESPN deal is mentioned in the GOR expressly and potentially is thus linked as part of that GOR deal, and until the option is exercised, the ESPN deal ends not in 2036 but in 2027, and arguably so should the GOR if the option is not exercised since the GOR as drafted by the ACC expressly mentions the ESPN deal by name. It almost is the consideration in the GOR deal. I only mention this because this impacts Scenario/Reason 2 below (the second reason ESPN may not be extending the deal).
Potential Reason 1, on why ESPN has not Extended - The most logical answer might be, they will not extend until FSU and Clemson are locked in. Well if that is true, the ACC is in a jam, because if they settle, the ESPN deal goes bye bye, and even if those schools paid a billion, is still does not equal the value of the ESPN deal through 2036 if extended. So that means, the ACC has to win and likely has to win fast and does not want this to drag on, or they are screwed anyways. No other media outlet will come in and replace ESPN either under that scenario. This is a bad spot to be if this is the reason, because it is a stand-off then. FSU/Clemson want out, ESPN will not extend without them locked in, and the ACC can't settle or they lose the deal.
Potential Reason 2 - What if the reason ESPN is not extending is due to the fact the ACC added 3 schools without running it by ESPN last summer to trigger the pro-rata clause in the ESPN deal, and then took most of their shares and artificially inflated pay-outs of the rest of the schools? That would piss off ESPN, because what is to stop the ACC from doing that again under the deal with other schools after ESPN extends? The pro-rata share clause does not appear to have a limit. Well if that is all true, ESPN could be hesitant in extending beyond 2026, because their budget is unknown. Schools could continue to be added. Anyway, if this is the reason, then the ACC may want to settle so it can freely amend the ESPN deal and not risk impacting the FSU/Clemson deal for materially changing the contract. It cannot try to amend the ESPN deal in current litigation since it is mentioned in the GOR the schools are suing over... that would not go over well. I could only imagine how the judge would react if the ACC says "Your honor we made some changes to the ESPN deal, but it has no outcome on this case..." No bueno!
Potential Reason 3 - What if the reason ESPN is not extending has nothing to do with the above, but because they are overextended in the CFP deal and purchasing the NFL network and the upcoming NBA deal, etc.? If this is the reason, then I think there is less chance of a quick settlement, because no matter what FSU/Clemson do, the ESPN deal is already dead, although I think the ACC would have better leverage to settle now than 10 months from now and no ESPN deal.
Anyway, my point is, you did not really cover the Extension Issue much, and frankly, that is a huge part of whether or not this can or will be settled. Also, if the deal is not extended, and these cases are still in Court, that will not go well for the ACC. I think you underestimate that the clock is really not in the ACC's favor here.
Agree with Neil from Clemson — a good sport, obviously — and just HAVE to say great job choosing photos. Two Seminole dudes all glittered up yet looking so sullen; how do you find these gems?!