Interesting read:

http://msn.foxsports.com/college-footbal...rights.php

(03-24-2014 03:07 PM)UHouston62 Wrote:  Interesting read:

http://msn.foxsports.com/college-footbal...rights.php

OK, under his theory, a court might allow a school to carry its TV rights away from the conference because it could calculate the cost to the conference of this loss as damages, and since the practice has been for networks not to reduce payments, the damages would be small.

A couple of observations.

First, if Texas left the Big 12, it would result in a reduction of the value of the Big 12 TV deal, and thus the damages, would be substantial. I'm not buying his "past practice"/fiduciary duty argument. If Wake Forest left the ACC, sorry Deacons, damages would be not so much.

Second, no network is going to fund the raid on another conference without a declaratory judgment in place agreeing with this opinion. So the raiding conference and/or the departing school are going to have to go to court in advance of the move to establish their right to breach the grant of rights and bring their TV rights with them. How long is that going to take? Who has the stomach for this fight?

Finally, ESPN and Fox are both in bed with all five Power Conferences. They would be stealing from themselves if they paid more to encourage realignment. Remember, ESPN saved the Big 12 by agreeing to maintain the payout when Colorado and Nebraska left. They like having five Power Conferences. It gives them the upper hand in contract negotiations.

This may be a case of "being right and having a dollar will get you a cup of coffee." From a practical standpoint, the grant of rights creates sufficient uncertainty to discourage anyone from actually pursuing his theory.

Great find. Thanks for posting.

this article has been discussed before and the consensus by people that had much more persuasive arguments is that the person that wrote this article is the type of lawyer you dream of facing in court so you can wipe the floor with them

he is not even discussing the proper type of law in his arguments he is discussing the GOR as if it is like an exit fee only without a set penalty when it is not close to the same

I don't believe the GoR is as iron clad as many do. However, it has the advantage of conference members wanting it to be iron clad.

Someone posted the B12 GoR. I don't remember it specifying LDs. The B12 bylaws do specify exit fees, which many are calling LDs.

if Maryland was exiting the ACC under the GOR their entire "discovery' phase so far would be a huge waste of time

as far as I can see Maryland is trying to say that at some time in the past (when Maryland was firmly a member of the ACC) the ACC discussed taking teams from the Big 10 and would have discussed not caring that the Big 10 might suffer damages from that and based on the lack of care by the ACC for something that MIGHT have happened in the past the ACC is not allowed to care that they might be damaged by Maryland leaving now

and further more the argument Maryland is making is that the 52.2 million is arbitrary and not realistic damages and is punitive

if Maryland was leaving under a GOR agreement it would be up to Maryland to prove they are being damaged by not taking their media rights with them and absent of that proof there would be no reason to allow them to do so

and once Maryland tried to set an amount they would be damaged by not allowing them to take their media rights that opens the ACC up to claim that same amount of damages......one party can't sign a contract willingly and then when THEY willingly break that contract try and claim damages while at the same time also trying to state the party they broke the contract with is not damaged that is just a stupid argument

so instead of the ACC having to prove that 52.2 million is a reasonable exit fee and Maryland trying to show there are no damages to the ACC from them leaving the GOR makes it the exact opposite

Maryland is free to leave, but they do not get to take their media rights and if they want to argue over media rights then they open themselves up to claims of damages because they are the ones that have to first claim they are damaged by not taking their media rights and as soon as they make that argument they open it up for the ACC to make the same exact claim.....so they are essentially making the vast majority of the case for the ACC by setting damages and asking for damages while trying to ignore that they are the ones willingly breaking a contract

while with an exit fee it is the exact opposite argument....the ACC has to prove damages and an amount and support why the 52.2 million is legit and not punitive

again this article has been discussed many times before and the vast majority of legal minds on this forum and others that could present any type of a logical argument tore that article to shreds and basically said the person that wrote it is a fool and is not even starting off in the proper area of law and it only gets worse from there

Seriously? Haven't we seen enough of OKTC acting like they know more than they really do? GOR shifts the leverage to the league where it previously was with the schools, possession is 9/10ths of the law etc...

Also this isn't going to be unique to the B12, the ACC GOR was modeled on the B12's.

If a school left it would have a chore proving that they were damaged by a GOR that they agreed to with their BOR's over several months and is paying them handsomely.

The GOR is not perfect but it's much tougher than the fans on this board like to imagine.

Seriously doubt anyone wants the legal hassle of testing a GOR.

Now once they get close to coming up, THEN the PAC and B1G (and potentially the SEC too but probably only in response to someone else's actions) are going to start nosing around the big properties in the B12 (UT/OU/KU) and the ACC (UNC/UVA/DUKE/VT/GT/FSU/MIAMI)

I read someplace, don't remember where, that the ACC's GoR is up for renewal 5 years before it actually expires. Can anyone confirm if that's true? If it is, that's pretty smart on the part of the conference. It would force a departing member into a five lame duck period if they want to leave with all their rights or into a negotiation where the conference has all the leverage.

(03-24-2014 05:34 PM)prp Wrote:  I read someplace, don't remember where, that the ACC's GoR is up for renewal 5 years before it actually expires. Can anyone confirm if that's true? If it is, that's pretty smart on the part of the conference. It would force a departing member into a five lame duck period if they want to leave with all their rights or into a negotiation where the conference has all the leverage.

I suggest you ask the Dude of WV. He knows all the inner details.

(03-24-2014 03:37 PM)orangefan Wrote:  

(03-24-2014 03:07 PM)UHouston62 Wrote:  Interesting read:

http://msn.foxsports.com/college-footbal...rights.php

OK, under his theory, a court might allow a school to carry its TV rights away from the conference because it could calculate the cost to the conference of this loss as damages, and since the practice has been for networks not to reduce payments, the damages would be small.

A couple of observations.

First, if Texas left the Big 12, it would result in a reduction of the value of the Big 12 TV deal, and thus the damages, would be substantial. I'm not buying his "past practice"/fiduciary duty argument. If Wake Forest left the ACC, sorry Deacons, damages would be not so much.

Second, no network is going to fund the raid on another conference without a declaratory judgment in place agreeing with this opinion. So the raiding conference and/or the departing school are going to have to go to court in advance of the move to establish their right to breach the grant of rights and bring their TV rights with them. How long is that going to take? Who has the stomach for this fight?

Finally, ESPN and Fox are both in bed with all five Power Conferences. They would be stealing from themselves if they paid more to encourage realignment. Remember, ESPN saved the Big 12 by agreeing to maintain the payout when Colorado and Nebraska left. They like having five Power Conferences. It gives them the upper hand in contract negotiations.

This may be a case of "being right and having a dollar will get you a cup of coffee." From a practical standpoint, the grant of rights creates sufficient uncertainty to discourage anyone from actually pursuing his theory.

Great find. Thanks for posting.

this is why i am such a opponent of the "network theory"

(03-24-2014 06:09 PM)TexanMark Wrote:  

(03-24-2014 05:34 PM)prp Wrote:  I read someplace, don't remember where, that the ACC's GoR is up for renewal 5 years before it actually expires. Can anyone confirm if that's true? If it is, that's pretty smart on the part of the conference. It would force a departing member into a five lame duck period if they want to leave with all their rights or into a negotiation where the conference has all the leverage.

I suggest you ask the Dude of WV. He knows all the inner details.

The Dude informs me the ACC GoR is worthless and the ACC is about to be poached out of existence by the Big XII.

I have never seen a good explanation of how the "enforcement" of a GOR would work (or does no one really know because they have never been challenged??). Aren't the schools in a GOR signing away their TV rights to the conference IN RETURN FOR A SHARE OF THE CONFERENCE'S TV REVENUE?

Without hearing otherwise, it seems to me to that there are scenarios where certain schools would be attractive to a conference with a cable network even with a GOR.

Let's hypothesize that, 5 years from now, the ACC is making $21mm from their ESPN deal and the B1G is making $33mm from their new TV deals and the BTN. The B1G adds UNC and UVA.

The B1G doesn't change the number of games they control (the new B1G conference road games for UNC and UVA they gain are offset by the fact the UNC and UVA home B1G conference games would fall under the ACC contract).

However, ESPN (ACC) would still have to pay UNC and UVA $21mm for televising all of their home games, wouldn't they?

Wouldn't the $12mm per year the B1G has to pay UNC/UVA be worth it, for the opportunity to increase the BTN revenue in the populous states of No Car and Va??

(03-25-2014 07:15 AM)krup Wrote:  I have never seen a good explanation of how the "enforcement" of a GOR would work (or does no one really know because they have never been challenged??). Aren't the schools in a GOR signing away their TV rights to the conference IN RETURN FOR A SHARE OF THE CONFERENCE'S TV REVENUE?

Without hearing otherwise, it seems to me to that there are scenarios where certain schools would be attractive to a conference with a cable network even with a GOR.

Let's hypothesize that, 5 years from now, the ACC is making $21mm from their ESPN deal and the B1G is making $33mm from their new TV deals and the BTN. The B1G adds UNC and UVA.

The B1G doesn't change the number of games they control (the new B1G conference road games for UNC and UVA they gain are offset by the fact the UNC and UVA home B1G conference games would fall under the ACC contract).

However, ESPN (ACC) would still have to pay UNC and UVA $21mm for televising all of their home games, wouldn't they?

Wouldn't the $12mm per year the B1G has to pay UNC/UVA be worth it, for the opportunity to increase the BTN revenue in the populous states of No Car and Va??

Would the Big 10 be willing to risk losing Michigan and Ohio St. road games? Its a total non-starter. No conference is going to risk that. Exit fees are the risk to the school leaving. GORs put the school AND the acquiring conference at risk. Just not going to happen.

The biggest thing to know about a Grant of Rights when it comes to conferences, is that no one in a position of power would willingly sign one if they had plans on moving. That immediately takes Texas, Oklahoma, FSU, UVa, and UNC out of the picture. Now a team that was not in a position of power who was more or less forced to sign one, sure maybe one of them has a wandering eye. But people don't willfully tie themselves up in these when they don't have to. This is what makes these a bit different than other grants of rights that exist in other industries, because often one party doesn't have any leverage or a lot of choice in the matter.

But two things we do know about them. One, they are enforceable and have been held up every time they have gone to court (some terms and conditions no so much). And in order to keep them in effect, the assignee must be continuously compensated for the rights they have assigned. If you don't pay to use them, you break the contract and not only lose the assignment of rights, but often have to pay punitive and compensary damages.

(03-25-2014 08:47 AM)adcorbett Wrote:  The biggest thing to know about a Grant of Rights when it comes to conferences, is that no one in a position of power would willingly sign one if they had plans on moving. That immediately takes Texas, Oklahoma, FSU, UVa, and UNC out of the picture. Now a team that was not in a position of power who was more or less forced to sign one, sure maybe one of them has a wandering eye. But people don't willfully tie themselves up in these when they don't have to. This is what makes these a bit different than other grants of rights that exist in other industries, because often one party doesn't have any leverage or a lot of choice in the matter.

But two things we do know about them. One, they are enforceable and have been held up every time they have gone to court (some terms and conditions no so much). And in order to keep them in effect, the assignee must be continuously compensated for the rights they have assigned. If you don't pay to use them, you break the contract and not only lose the assignment of rights, but often have to pay punitive and compensary damages.

When you confirm that the conference being left still has to pay for the TV rights, it seems to show that the schools you specifically listed are the ones NOT as constricted by the GOR. To use the UNC example I threw out above, if the B1G added UNC....

-they would lose control (until the GOR period ended) of UNC's 4-5 home B1G conference games (which would be shown by ESPN under the ACC contract) and would pay UNC $12mm a year

-In return, the B1G gets the UNC's road conference games, they improve their BB conference, and they get the BTN in-state carriage rates for North Carolina, which would generate $40mm a year in revenue.

That doesn't sound like it is such a horrible deal for the B1G (or SEC) to live with until the GOR runs out. It seems that the GOR binds the schools with LESS options and that there is still a small set of schools (Texas, UNC, FSU, maybe Virginia) that could leave even with a GOR.

That is also true. The GOR is not there to keep the schools in power there. It is to keep the others there.

However they would not sign it if they were planning a move. Doesn't mean things won't change, but as those GOR's are not very old, I doubt any would willfully sign it with a foot out the door.

(03-25-2014 09:26 AM)adcorbett Wrote:  That is also true. The GOR is not there to keep the schools in power there. It is to keep the others there.

However they would not sign it if they were planning a move. Doesn't mean things won't change, but as those GOR's are not very old, I doubt any would willfully sign it with a foot out the door.

I agree, I don't think anyone is planning anything now either. I guess the point I am trying to make is that for certain schools, we would not need to wait for their GOR to completely end for movement.

Both the ACC and B12 GORs end around 2025/2026. Instead of having to wait until they run out, if the new B1G TV contracts really do reach a level that separates them from the pack starting in 2018, we could see things starting to heat up again as early as then.

this. the morons (i'm being as kind as i possibly can here) that continue to speculate about loopholes in the ACC GOR are amusing in that way. they willfully ignore the fact that the schools with options would NEVER sign such an agreement if they had wandering eyes.

(03-25-2014 08:47 AM)adcorbett Wrote:  The biggest thing to know about a Grant of Rights when it comes to conferences, is that no one in a position of power would willingly sign one if they had plans on moving. That immediately takes Texas, Oklahoma, FSU, UVa, and UNC out of the picture. Now a team that was not in a position of power who was more or less forced to sign one, sure maybe one of them has a wandering eye. But people don't willfully tie themselves up in these when they don't have to. This is what makes these a bit different than other grants of rights that exist in other industries, because often one party doesn't have any leverage or a lot of choice in the matter.

But two things we do know about them. One, they are enforceable and have been held up every time they have gone to court (some terms and conditions no so much). And in order to keep them in effect, the assignee must be continuously compensated for the rights they have assigned. If you don't pay to use them, you break the contract and not only lose the assignment of rights, but often have to pay punitive and compensary damages.

Same thing with the morons speculating on the Big 12. It's gonna be a while before either gets hit again if they do at all.

(03-25-2014 09:50 AM)ren.hoek Wrote:  this. the morons (i'm being as kind as i possibly can here) that continue to speculate about loopholes in the ACC GOR are amusing in that way. they willfully ignore the fact that the schools with options would NEVER sign such an agreement if they had wandering eyes.

(03-25-2014 08:47 AM)adcorbett Wrote:  The biggest thing to know about a Grant of Rights when it comes to conferences, is that no one in a position of power would willingly sign one if they had plans on moving. That immediately takes Texas, Oklahoma, FSU, UVa, and UNC out of the picture. Now a team that was not in a position of power who was more or less forced to sign one, sure maybe one of them has a wandering eye. But people don't willfully tie themselves up in these when they don't have to. This is what makes these a bit different than other grants of rights that exist in other industries, because often one party doesn't have any leverage or a lot of choice in the matter.

But two things we do know about them. One, they are enforceable and have been held up every time they have gone to court (some terms and conditions no so much). And in order to keep them in effect, the assignee must be continuously compensated for the rights they have assigned. If you don't pay to use them, you break the contract and not only lose the assignment of rights, but often have to pay punitive and compensary damages.

(03-25-2014 07:15 AM)krup Wrote:  I have never seen a good explanation of how the "enforcement" of a GOR would work (or does no one really know because they have never been challenged??). Aren't the schools in a GOR signing away their TV rights to the conference IN RETURN FOR A SHARE OF THE CONFERENCE'S TV REVENUE?

Without hearing otherwise, it seems to me to that there are scenarios where certain schools would be attractive to a conference with a cable network even with a GOR.

Let's hypothesize that, 5 years from now, the ACC is making $21mm from their ESPN deal and the B1G is making $33mm from their new TV deals and the BTN. The B1G adds UNC and UVA.

The B1G doesn't change the number of games they control (the new B1G conference road games for UNC and UVA they gain are offset by the fact the UNC and UVA home B1G conference games would fall under the ACC contract).

However, ESPN (ACC) would still have to pay UNC and UVA $21mm for televising all of their home games, wouldn't they?

Wouldn't the $12mm per year the B1G has to pay UNC/UVA be worth it, for the opportunity to increase the BTN revenue in the populous states of No Car and Va??

I stopped reading at the B1G making $33 million from their TV rights. They are currently getting $7.5 million for the B1G Network. The best they can hope for is $10 million after adding Rutgers and Maryland. And this is wildly optimistic. They are only selling their Tier 1 rights. In what universe would anyone pay $23 million for Tier 1 rights when the current going rate for Tier 1 & 2 is around $20 million? The other conferences have look in clauses. These are tied to the market rate being paid for TV rights. By paying the B1G those numbers it ensures the others will get close to that in look in years. That is a business model that has bankruptcy built in. My guess is all 5 P5 conferences will be within 15% of each other after the B1G and SEC renegotiate their deals.