Guest Post: Legal Analysis of the ACC Opposition Motion

Part 11 in our ongoing ACC legal drama!

Ed Note: TwistNHook is back for more legal analysis, and with news breaking that Clemson might be considering legal action similar to Florida State’s suit, his expertise is all the more valued. Go ACC! Please don’t collapse and leave Cal homeless again!

Part 1: ACC Stability
Part 2: FSU vs. ACC Part 1
Part 3: FSU vs. ACC Part 2
Part 4: The ACC Strikes Back Part 1
Part 5: The ACC Strikes Back Part 2
Part 6: Florida State's Amended Complaint
Part 7: The ACC's Motion to Dismiss, Part 1
Part 8: The ACC’s Motion to Dismiss, Part 2
Part 9: Florida State’s Motion to Dismiss, Part 1
Part 10: Florida State’s Motion to Dismiss, Part 2

Hello friends, I wanted to provide you with another blog post on the ACC v. FSU legal fight.  There is so much going on, it’s important to understand exactly what we are talking about here.  Let’s just take it 1 step at a time

See, the ACC filed a lawsuit against FSU in North Carolina (which they later amended).  FSU filed a Motion To Dismiss/Stay, because they argue that FSU’s FL lawsuit should be the primary lawsuit here.  The ACC has now filed a Opposition to that Motion.  This is set for March 22, 2024 in North Carolina.  The ACC has filed a similar motion in FL and it is set for April 9, 2024.  It strikes me that the FL Judge may follow what the NC Judge does.  For example, if the NC Judge denies FSU’s motion (allowing NC to proceed), the FL Judge may stay the FL matter.  It would be a bit weird if both matters were allowed to proceed, although that may occur.  

So, this hearing on 3.22.24 could decide FSU’s legal challenge in one fell swoop.  If it causes the FL matter to be stayed, FSU’s legal adventure is over before it barely began.  This FSU Motion, thus, is extremely important.  Let’s dive into the Opposition here to see what the ACC is saying in response to the FSU Motion.

A key item to focus on here is that FL is a “priority” jurisdiction.  That means whoever files first wins.  The ACC filed first here and that does not appear to be in dispute.  Thus, FSU has to come up with a series of arguments to state that somehow the ACC lawsuit was not proper.  Let’s look at those and the ACC’s response.

Premature Filing

The first argument FSU raised in its motion was that the ACC lawsuit was premature.  Both sides argue this in the other jurisdiction.  However, in their preferred jurisdiction, there is a major dispute that needed to be resolved by their lawsuit.  It is a bit hypocritical, but that’s never stopped lawyers before!  

The ACC argues that they filed a lawsuit, in part, for Declaratory Judgment (which is also what FSU did in FL).  This is where the party gets a Judge to declare a reality (ie GOR is invalid etc).  The ACC cites to law that indicates a party can file a Declaratory Judgment lawsuit “before obligations are repudiated or rights are violated.”  This means that a party in NC can file a Declaratory Judgment lawsuit if it appears that a violation of a contract may occur.

The ACC argues that since FSU filed no documents contradicting the ACC’s facts, the ACC’s facts must be taken as true.  I cannot independently verify that that is the law of NC.  Presuming it is true, the ACC goes through a recitation of the history prior to the FSU filing of its lawsuit.  This shows that the ACC knew a repudiation was about to happen.  This justified the filing of their suit and shows that it is not premature.  It is important to remember that FSU filed the next day, so it is a somewhat hard argument to make that the ACC’s lawsuit was premature.

The ACC argues that under FSU’s interpretation, nobody could sue for Declaratory Judgment until after the breach had occurred.  They argue that that would be illogical to create a legal framework that only benefited one side.  

2/3rds Requirement

The next section held my focus, because it related to the 2/3rds requirement for filing lawsuits.  The ACC has language in its bylaws reflecting this requirement.  FSU noted that this had not occurred and argued that that meant the ACC complaint was improper.  

ACC argues a few things to try to get around this:

1. First, they argue that FSU is basically trying to contradict facts here.  This is what a CA attorney would call a Demurrer analysis.  Basically, FSU is trying to argue the ACC failed to take an action.  However, the ACC argues that since all ACC facts in the complaint must be taken as true, the ACC alleged enough facts to make its case.  This is complicated, but it is basically an argument that it does not matter what actually happened as long as the ACC states sufficient facts to support its claim.  The ACC argues that it did allege sufficient states supporting its standing to file the lawsuit and that that is sufficient

2. The second argument is that the Court should not get involved in the internal matters of the ACC bylaws.  The ACC argues that it can interpret “material litigation” however it wants and the Court is not in a position to dispute that.  The ACC cites to some law in support of this position.  

3. Next, the ACC argues that the word “material litigation” is undefined.  However, it does imply that there may be some “non-material” litigation where the 2/3rds vote is not necessary.  As such, the ACC argues that this lawsuit is just such a lawsuit.  This may seem like a bizarre argument since this lawsuit seems super material to me and many others.  
   

   In response to that thought, the ACC argues that this lawsuit is a "commercially reasonable action to protect the rights provided to ESPN.”  Basically, they argue that the ACC had to file its NC lawsuit not to protect the ACC but to protect ESPN.  The ESPN Agreements, executed by FSU, require the ACC to protect ESPN.  So, the ACC argues they had to file the lawsuit.  Since the lawsuit does not “change any contractual or commercial relationships,” the ACC argues the 2/3rd vote was not necessary.  I honestly do not know hot to interpret this argument since the lawsuit seems to change contractual or commercial relationships.  I guess the ACC is arguing that it is seeming to just confirm the relationships and not actually change anything.  
   

   Then, ACC raises the “cannot dispute facts” argument here.  It basically says that even if FSU disagrees with its analysis, they did not provide any facts in dispute.  As such, the ACC facts are the gospel truth and so whatever they say goes.  Let’s see how this plays out.   

4. The next argument that the ACC raises is that they did have the 2/3rd vote.  They just didn’t invite FSU to it!  The ACC says that after filing the lawsuit, they held a vote on the Amended Complaint.  Apparently, they held a no-notice meeting, which requires 3/4th of the teams to vote for it.  So, at least 12 out of 15 voted to have this meeting.  Then, they had a unanimous vote and approve the Amended Complaint and retroactively ratify the initial complaint.  It is not clear what teams attended.  1 of the 3 that could have not known would be FSU.  Up to 2 other teams may not have known, but all 14 may have.  Those other two potentials could be teams like Clemson, UNC, or Miami.  Sucks that FSU didn’t get invited to the party, right?

I cannot speak as to how this argument will go.  It would 100% approve the Amended Complaint, no questions asked.  FSU argues that the initial FSU Complaint was filed before the Amended ACC Complaint (True) so it should have priority filing in FL.  I will note that the Amended FSU complaint came after the Amended ACC complaint.  

Lacks Jurisdiction

Next, the ACC deals with FSU’s argument that NC lacks jurisdiction over FSU and that the lawsuit must be in FL.  First, the ACC notes that this issue was raised in the ACC-Maryland lawsuit in 2013 and found in the ACCs favor.  Also, the ACC notes that FSU signed up to be a member of a NC-based organization, so it means ACC can sue FSU in NC.  It does logically follow that if FSU’s analysis was correct, ACC would have to file a lawsuit in like 10 different states if it wanted to deal with its members.  That does not make a lot of sense. 

The ACC also notes what I noted in my previous posts, that the FL law cited by FSU states that FSU can be sued “in all courts of law or equity.”  They note, as I did, that this does not say “all Florida Courts of law or equity.”  The plain reading of the text means that they can get sued everywhere and anywhere.  

Next, the ACC makes an interesting point that I failed to even realize.  FSU and ACC are fighting over sealing certain media agreements.  Here, FSU has filed paperwork with the Court.  This means that they have made a “general appearance.”  A “general appearance” is where a party requests the Court do a thing.  In this instance, the thing is “not seal media agreements.”  The law of NC (and also CA, too) is if you make a general appearance you basically waive any issues with jurisdiction.  

What this means is that basically ACC argues FSU cannot file a motion to dismiss the ACC action for another venue to take primacy.  Per the Opposition, FSU cannot do this, because they have “invoke[d] the adjudicatory powers of the Court” (ie showed up).  

Board Approval

Next, the ACC takes up FSU’s dumbest argument:  that the Board itself never approved the 2013 and 2016 contracts.  This is dumb for both serious and non-serious reasons.  The serious reasons are because the GOR contract itself states that the FSU president has the authority to sign the contract.  Additionally, a footnote in the Opposition notes that certain FSU Regulations and FSU Policies explicitly provide Presidential authority to enter into contracts.  

The non-serious reasons are that it would be perplexingly stupid to require the Board to execute all FSU contracts.  The Board would have to spend every day executing contracts.  That is not the Board’s responsibility.  The Opposition states that this argument from FSU is just plain not plausible.  

Extracontractual Obligations

The last argument raised by FSU in its Dismissal portion of the Motion is that 3 of the ACC’s claims impose “extracontractual” obligations on FSU improperly.  The Opposition states that the Motion cites no case law confirming this.  The Opposition then goes through the 4th and 6th claim to show that there is a factual basis for their counts.  The 4th is breach of confidentiality relating to the ESPN media agreements.  

The 6th is breach of good faith and fair dealing.  FSU argues that this is “extracontractual” and nothing in the relevant contracts relates to this.  The Opposition cites to some NC law indicating that every contract by its nature requires good faith and fair dealing.  

The 5th count is breach of fiduciary obligation.  The opposition spends a lot of time analyzing this.  They argue that the ACC is a “joint venture” and that a “joint venture” requires fiduciary duties from one party to another.  The ACC argues that FSU’s lawsuit is a breach of that fiduciary duty, because it is not in the best interest of the ACC.  

The FSU Motion is not clear on this, but the Opposition treats the motion like a CA-style Demurrer.  They argue that, at best, the Motion proves factual disputes, which cannot be resolved via motion like this.  As such, the Opposition argues the Motion must be denied.

Motion To Stay

Next, the Opposition takes up the Motion’s argument that the NC Court should stay the ACC proceeding.  According to the Opposition, the Motion needed to argue that litigating the matter in NC would be a “substantial injustice.”  The Opposition states that this is the key legal analysis, but that the Motion itself never actually touches on it.  The Opposition states that the Motion complains about “a race to the courthouse.”  

However, the Opposition argues that “if there was a race to the courthouse, FSU started it.”  The Opposition says that FSU is not angry there was a race to the Courthouse. They are angry that FSU lost.  

The Opposition argues that a party suing where it exists (ie Mecklenburg County in NC) is not improper forum shopping.  Improper forum shopping would be if the ACC filed in Montana, because they had some backroom deal with a Judge there.  The Opposition argues that it is the most logical thing in the world for the ACC, once they saw FSU preparing for a lawsuit over the validity of the GOR, to file its own lawsuit in its home county.  

There are 10 different factors relevant to determining proper venue per NC law.  The Opposition takes a while to go through them and analyze them.  I will spare you those boring details, but rest assured the Opposition finds that they are all in the ACC’s favor.  Surprise!

After doing this complete analysis, the Opposition finds that there is not substantial injustice to have this lawsuit in NC and the Court should not stay it. 

Conclusion

This is a well argued Opposition.  It systematically goes through each one of FSU’s arguments and seeks to tear them down one by one.  Between now and the 3.22.24 hearing on this matter, we may get a Reply Brief.  I will try to analyze that also and provide my thoughts as we head into this pivotal hearing.  Thanks for reading!