Northeast Stinger
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Refs don’t like it when you’re working the refs. Like refs, these guys are human too. But they do a good job calling it down the middle.
Conference Realignment
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bobongo
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Mmm, Indeed. Then I guess they shouldn't have signed the contract. But they did, didn't they? Like my old First Sergeant used to say when someone came whining to him - "Sounds like a personal problem".
WreckinGT
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Here is an article I posted earlier about FSU and their fund raising endeavors. https://billfarley.substack.com/p/fsus-acc-exit-hinges-on-a-bidding. They will raise what they need to raise. They aren't going to go broke doing so.
WreckinGT
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We will see. Can I assume that you too think FSU will be in the ACC in 2035?
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FSU is contractually required to provide all access necessary to support the broadcast of the games.
They have to provide good vantages and safe access for the crew and equipment. And probably a lot of other things I’m not mentioning here.
It’s not just a grant of rights. It’s a grant of rights plus the means to execute them.
yeti92
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Gone by 2036 sure, but there is a line where it costs too much and it financially is too great a hit and does not make sense for FSU to leave. The ACC also has a line where too low and it financially does not make sense to allow FSU to leave. Need the ACC's line to be below FSU's line, but we don't know where those lines are, and they shift as time goes on.
If the ACC looks at the Big 10 and sees they are projecting $80-100m/school in annual payouts, they could say if you want to leave and have your media rights back, we will accept $80m/yr for each year through the end of the GOR to return your media rights, plus the normal conference buyout of $130m or whatever that amount is. FSU is not paying $1.09B to leave this year.
RonJohn
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I don't know that there would, but it is a possibility:
There are four essential elements to a charge of criminal copyright infringement. In order to sustain a conviction under section 506(a), the government must demonstrate: (1) that a valid copyright; (2) was infringed by the defendant; (3) willfully; and (4) for purposes of commercial advantage or private financial gain.
Fox, NBC, and CBS would all know this. And as I said before, none of those companies want copyright rights to be diminished in any capacity. IF they were able to somehow find a way to skirt copyright to air in dispute games, they would open up all of their competitors to use the same arguments with all of their copyrighted materials. College football is such a small part of their entire business that I don't think it would be worth the risk.
The wording in the GOR could potentially open up a legal battle over what that exact wording means. However, I must point out that the only reference to an option is from the FSU filing. The ACC response references an ESPN nine-year option, but only in response to FSU's claims about it. The ACC response doesn't actually confirm an option and doesn't provide any details about what it is if it does exist. I think there probably is some kind of option. What the details of that option are, I don't have a clue.
Do courts enforce time-share contracts that make old people living on nothing but social security continue to pay maintenance fees for a time-share that they never have a chance to use? Do courts enforce arbitration agreements that force people who purchased an RV file arbitration in the home county of the RV manufacturer for things that should be covered under a warranty? (The answer to both is yes)
People are far too lax in how they handle contracts. Many states have some protection for things like purchasing cars, but people still sign away far too much without even reading the contracts. People believe that you can't give up things like a right to a trial by jury, but you most certainly can and arbitration agreements prove that. In this case, FSU signed a document that assigns their media rights to the ACC until 2036. They can't even argue that they didn't understand the document, because their own BOT made statements about how it was going to make it difficult for any team to leave the conference. To me it is hard to see a court allowing one party out of a signed contract when that party knew the full implications of the contract when they signed it.
cpf2001
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Nothing in that link explains why they would be guaranteed to get favorable ROI and/or terms on anything they sell to raise money for *this*. Lotta "borrowing money is something we do all the time, it never goes wrong!" Yada yada yada. Yes, they will believe all day long that the ROI is gonna be there. But they could also be wrong. You can layer it all you want, like the mention of Oregon/UW being able to borrow from the Big 10 against future media rights, but robbing Peter to pay Paul only works for so long. A sophisticated investor might well look at this, and look at the sports media rights and advertising landscapes post-zero-interest-rates, and say "hmmm we are gonna want a lot of strings attached."
RonJohn
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They have a contractual obligation to do so. They could break the contract and refuse to do so.
I was pointing out the difference between what FSU could break and what they can't break. They do not have ownership of their media rights, so they can't sell those media rights to someone else. I see that as a big difference. They don't even have the physical ability to break the media rights ownership part of the GOR.
WreckinGT
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This would just start a price war that would be settled in court. The ACC can't just attempt to extort them for any unreasonable amount they feel like. That would just boost FSU's case against them.
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Hyperbole.
WreckinGT
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Not hyperbole.
yeti92
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That isn't extortion and it isn't an unreasonable amount. If the Big 10 is willing to pay that much to FSU for their media rights, the ACC is allowed to ask for the same for the sale of FSU's media rights.
WreckinGT
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There is no evidence that the Big 10 will pay that much for FSU, nor is there any evidence that FSU's value in the ACC is equal to FSU's value in the Big 10. Overcharging significantly, making it impossible to leave without paying a clear penalty on top of fair market rights is certainly extortion.
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Yes it is. Using the word extortion in reference to this is textbook hyperbole.
Techster
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That's the part that will be challenged. I'm not a lawyer, but the GOR agreement floating around reads as if it exists for the purpose of the ESPN media contract, despite some on here saying the GOR exists separately outside of the ESPN contract. That's not my interpretation of the GOR (at least the one floating around the internet):
RECITALS:
WHEREAS, the execution and delivery of this Agreement enhances the stability of Conference membership, confirms the commitment by each Member Institution to the other Member Institutions of the Conference, and thereby provides valuable benefits to each Member Institution of the Conference;
WHEREAS, the Conference has previously entered into the Multi-Media Agreement with ESPN, Inc. and ESPN Enterprises, Inc. dated as of July 8, 2010, as amended by the Amendment and Extension Agreement dated as of May 9, 2012 (as amended collectively referred to as the "Amended ESPN Agreement'');
WHEREAS, each of the Accepted Members has been accepted for membership in the Conference by the Current Members and each Accepted Member has agreed that its membership shall be effective on the date specified on its signature page to this Agreement;
WHEREAS, as a condition to the agreement of ESPN to offer additional consideration to the Conference as pa11 .of a further amendment to the Amended ESPN Agreement (the "Additional Amendment"; the Additional Amendment, together with the Amended ESPN Agreement, collectively, the "ESPN Agreement"), each of the Member Institutions is l'equired to, and desires to, irrevocably grant to the Conference, and the Conference desires to accept from each of the Member Institutions, those rights granted herein; and
WHEREAS, the Conference and the Member Institutions desire to have this Agreement memorialize their understandings with respect to the matters set forth herein.
NOW, THEREFORE, for and in consideration of the foregoing, the covenants set forth herein and in the ESPN Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and agreed, and intending to be legally bound hereby, the undersigned each hereby agree with the Conference and with each other as follows:
Here they get more specific to the "Grant of Rights":
Grant of Rights. Each of the Member Institutions hereby (a) irrevocably and exclusively grants to the Conference during the Term (as defined below) all rights (the "Rights'') necessary for the Conference to perform the contractual obligations of the Conference expressly set forth in the ESPN Agreement, regardless of whether such Member Institution remains a member of the Conference during the entirety of the Term and (b) agrees to satisfy and perform all contractual obligations of a Member Institution during the Term thatare expressly set forth in the ESPN Agreement.
The Grant of Rights portions goes on to specifically identify what material items (media forms) the GOR covers.
The other detail of the contract that leads me to believe the GOR exists as a binding "companion" of the ESPN media contract, and not a stand alone agreement, is the Term section. The original expiration of the GOR and ESPN contract ran concurrently (originally to 2027), and when the ESPN contract was amended to 2036, the GOR Term was also extended to match the new ESPN media contract. I don't think that was coincidence. In addition, the GOR references and points to the ESPN media contract too many times...in other words, if any mention of the ESPN media contract was removed, what good is the GOR? That's essentially what occurs if ESPN opts out in 2027.
From a strictly business POV, it would not be a good business decision for ESPN to terminate this agreement in 2027. It's been pointed out that the ACC is the most profitable media contract ESPN has in terms of its college assets. HOWEVER, if ESPN does pull of the ACC media agreement, not sure how the GOR is valid beyond ESPN's last pay check to the ACC as the terms of the GOR are heavily influenced by the ESPN media agreement.
I don't think access to the ESPN media agreement would address this issue either. I think the ESPN media contract just addresses the specifics of the terms, $$$ amount, and media rights of the ACC. There's no reason to think the ESPN media agreement would hash out the membership rights outside of the ACC, outside of saying the ACC members need to agree to a binding agreement in order for ESPN to move forward with their investment in the ACC (the ACC network specifically).
Again, I'm not a lawyer, so those more well versed in legalese feel free to correct my assumptions above.
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Extortion involves force and threats. The ACC is neither forcing nor threatening FSU to take these measures.
Again. Hyperbole.
WreckinGT
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Using their position to overcharge FSU for their media rights in order to leave is extortion. Again. Not hyperbole.
bobongo
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Here you are with that "2035" folderol again. No, and I've said before, under present conditions the ACC will likely break up sometime in the early 2030s, as most others have as well, when the cost of doing so becomes manageable. But this is 2024, isn't it?
forensicbuzz
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The ESPN contract may have language requiring the GOR, but the GOR does not have any language about contracts. It's a very simple document. There's not enough language in it to have any loopholes.