What rights does the Grant of Rights assign to the Conference? "Those rights necessary for the conference to perform ..... the ESPN Agreement."

The 2013 GOR "grants to the Conference during the Term ... all rights necessary for the conference to perform the contractual obligations of the Conference expressly set forth in the ESPN Agreement...", and then restates that in various ways.

The 2016 agreement says:
1. The term "ESPN Agreement" in the fourth "Whereas" clause of the Original Grant Agreement is hereby amended to refer collectively to the Original ESPN Agreement and the Prospective Agreements.
2. Section 5 of the Original Grant Agreement is hereby amended by deleting the first sentence of the existing Section 5 in its entirety and substituting the following therefor:
3. "Term. The "Term" of this Agreement shall begin on the Effective Date and shall continue until June 30, 2036.


...so if there's no ESPN Agreement past 2027, does the GOR grant any rights at all to the ACC? Technically the agreement is still in effect through 2036, but if there's no ESPN Agreement past 2027, it's an agreement with no provisions.

Probably doesn't matter. If there's no agreement past 2027, then it'll look like the PAC10 getting pulled apart so they'll have enough votes to dissolve the conference and end the GOR.

(12-26-2023 05:16 PM)johnbragg Wrote:  What rights does the Grant of Rights assign to the Conference? "Those rights necessary for the conference to perform ..... the ESPN Agreement."

The 2013 GOR "grants to the Conference during the Term ... all rights necessary for the conference to perform the contractual obligations of the Conference expressly set forth in the ESPN Agreement...", and then restates that in various ways.

The 2016 agreement says:
1. The term "ESPN Agreement" in the fourth "Whereas" clause of the Original Grant Agreement is hereby amended to refer collectively to the Original ESPN Agreement and the Prospective Agreements.
2. Section 5 of the Original Grant Agreement is hereby amended by deleting the first sentence of the existing Section 5 in its entirety and substituting the following therefor:
3. "Term. The "Term" of this Agreement shall begin on the Effective Date and shall continue until June 30, 2036.


...so if there's no ESPN Agreement past 2027, does the GOR grant any rights at all to the ACC? Technically the agreement is still in effect through 2036, but if there's no ESPN Agreement past 2027, it's an agreement with no provisions.

This is what I've been asking for quite awhile now.

Whether: If there's no espn deal, then there's no GoR.

Someone in another thread suggested that one of the things a judge may ask, is to ask if espn is exercising their right to the unilateral extension.

I think answering that question puts espn in a position that perhaps they might not want to be in. I could see a "no" happen there.

If they say "yes", they will get dragged into this FSU vs ACC fight

If they say "no", they avoid most of it.

And they have the cover of saying that it's a cost-cutting measure, as Disney is billions in debt...

Guys - this is 100% the GOR still has the same effect until 2036 under the contract. That is how the “Term” is defined.

A GOR does NOT need to be the same length as the TV contract. Repeat: they do NOT need to be the same.

Even more glaring is that FSU itself didn’t even try making this argument in its complaint. If THEY don’t even think it’s an argument (and that would be a hypothetically easier argument to to show as it deals with the terms of the contract itself as opposed to significantly more difficult extraneous legal theories), then the fact that fans are even bringing it up is irrelevant. Not even FSU’s own lawyers are attempting that argument.

How bout this scenario:

ESPN does not extend the ACC contract past 2026.

Clemson, Miami, UNC and others bail.

ACC goes to open market.

Open market offers $15m a year.

The ACC takes it.

FSU, Clemson, Miami, UNC and others only owes $15m per year until 2036.

Is that how it works?

I don't know why so many people are hung upon that point.

In calculating the buy-out payment, certain estimate/forecast is necessarily involved. For example, the future ACCN payout is not fixed. It depends on the number of subscribers so it's a variable payment. So for the period from 2027 through 2036, the GoR is still effective. They just need to estimate the media payment for 2027 through 2036 based on what they know as of now.

The most reasonable assumption at this point is that ESPN would continue the contract through 2036. If this is the case, then no need to fuss about this.

The second most reasonable assumption would be ESPN and the ACC negotiate and lower the payout. If that is the case, the buyout amount would be discounted a little bit. But it's going to be still quite substantial.

Lastly, I guess there is a very small possibility of the ACC signing with another TV network for 2027 through 2036, Even in this case, I am not sure the media right of FSU (or any other ACC schools) goes back to FSU.

Didn't FSU itself claim that the exit payment would be $572 million? That's their best estimate.

(12-26-2023 06:41 PM)random asian guy Wrote:  I don't know why so many people are hung upon that point.

In calculating the buy-out payment, certain estimate/forecast is necessarily involved. For example, the future ACCN payout is not fixed. It depends on the number of subscribers so it's a variable payment. So for the period from 2027 through 2036, the GoR is still effective. They just need to estimate the media payment for 2027 through 2036 based on what they know as of now.

The most reasonable assumption at this point is that ESPN would continue the contract through 2036. If this is the case, then no need to fuss about this.

The second most reasonable assumption would be ESPN and the ACC negotiate and lower the payout. If that is the case, the buyout amount would be discounted a little bit. But it's going to be still quite substantial.

Lastly, I guess there is a very small possibility of the ACC signing with another TV network for 2027 through 2036, Even in this case, I am not sure the media right of FSU (or any other ACC schools) goes back to FSU.

Didn't FSU itself claim that the exit payment would be $572 million? That's their best estimate.

Worse case scenario best estimate.

(12-26-2023 06:41 PM)random asian guy Wrote:  I don't know why so many people are hung upon that point.

In calculating the buy-out payment, certain estimate/forecast is necessarily involved. For example, the future ACCN payout is not fixed. It depends on the number of subscribers so it's a variable payment. So for the period from 2027 through 2036, the GoR is still effective. They just need to estimate the media payment for 2027 through 2036 based on what they know as of now.

The most reasonable assumption at this point is that ESPN would continue the contract through 2036. If this is the case, then no need to fuss about this.

The second most reasonable assumption would be ESPN and the ACC negotiate and lower the payout. If that is the case, the buyout amount would be discounted a little bit. But it's going to be still quite substantial.

Lastly, I guess there is a very small possibility of the ACC signing with another TV network for 2027 through 2036, Even in this case, I am not sure the media right of FSU (or any other ACC schools) goes back to FSU.

Didn't FSU itself claim that the exit payment would be $572 million? That's their best estimate.

The ACC GoR has espn agreement referenced all over it. How would it hold if say they sign with Fox or NBC. They’d need to draft a new one and have all members sign it.

As. I posted in another thread:
1. FSU declares their intent to exit in 2027 and initiate legal proceedings before ESPN look in.
2. At look in, seeing the prospects of an ACC without FSU plus maybe more, decides to offer the ACC less.
3. FSU argues that its signature on the GoR was contingent upon ESPN contract extension at previously agreed to rates. Since that. Is no longer the case, FSU cancel its GoR and retains its media rights upon leaving the ACC.
4. The ACC settles out of fear of not getting any media contract ala BE / Pac. ESPN spends money saved from the ACC on former ACC stars.

(12-26-2023 06:51 PM)Acres Wrote:  

(12-26-2023 06:41 PM)random asian guy Wrote:  I don't know why so many people are hung upon that point.

In calculating the buy-out payment, certain estimate/forecast is necessarily involved. For example, the future ACCN payout is not fixed. It depends on the number of subscribers so it's a variable payment. So for the period from 2027 through 2036, the GoR is still effective. They just need to estimate the media payment for 2027 through 2036 based on what they know as of now.

The most reasonable assumption at this point is that ESPN would continue the contract through 2036. If this is the case, then no need to fuss about this.

The second most reasonable assumption would be ESPN and the ACC negotiate and lower the payout. If that is the case, the buyout amount would be discounted a little bit. But it's going to be still quite substantial.

Lastly, I guess there is a very small possibility of the ACC signing with another TV network for 2027 through 2036, Even in this case, I am not sure the media right of FSU (or any other ACC schools) goes back to FSU.

Didn't FSU itself claim that the exit payment would be $572 million? That's their best estimate.

The ACC GoR has espn agreement referenced all over it. How would it hold if say they sign with Fox or NBC. They’d need to draft a new one and have all members sign it.

That's possible but I'm not sure if that happens in 2027, that would invalidate the whole GoR.

The point is that the buy-out calculation would be based on what they know as of now. If I were an economist/accountant for this case, I would assign the probability for each scenario to determine the final buy-out amount.

Anything above a full exit fee offered by FSU would be good enough to avoid finding out what happens if ESPN declines its option.

What is the value of 3x the operating expense (exit fee) and GOR rights to buy back for a conference that has no off take? Good luck getting schools to commit to exclusively Apple or CW for $15 million when the remaining top brands benefit from there being no deal.

And that’s on top of the material risk the ACC would lose in court, which would absolutely have espn bail on the option, and would be catastrophic to leftovers, and any chance ACC/ESPN wants to avoid discovery

The ACC HAS to stop being maximalists and figure out a way to get realignment value out of the current uncertainty. Remove risk. From what we know, if FSU offers anything north of amortization of $150 million, the leftovers should take it.

If you’re a bottom 6 ACC school, you can’t let this reach ESPN’s deciding point before a settlement. And given ESPN could decline at any point they get an acceptable agreement on top ACC brands, there’s urgency. They should be begging to get $150 million per exiting school and to get favor from the networks. Give up FSU and others asap in exchange for espn renewing and helping move 6+ Big 12 (transaction cost paid for by settlement).

If ESPN declines and “if” the GOR was contingent on the media deal (as the OP ponders), there really is no need for a lawsuit. This may easily explain why it is not mentioned by FSU. They are operating under the likelihood that ESPN re-ups. Otherwise they’d just follow the OU/UT playbook, announce for ‘27 and negotiate a year early.


It’d be interesting if ESPN has incentive to jailbreak the ACC. Could they save money paying 14 football schools in the ACC vs. moving 4 to the SEC? Don’t think they can telegraph this to FSU without risking tampering charges.

(12-26-2023 07:01 PM)random asian guy Wrote:  

(12-26-2023 06:51 PM)Acres Wrote:  

(12-26-2023 06:41 PM)random asian guy Wrote:  I don't know why so many people are hung upon that point.

In calculating the buy-out payment, certain estimate/forecast is necessarily involved. For example, the future ACCN payout is not fixed. It depends on the number of subscribers so it's a variable payment. So for the period from 2027 through 2036, the GoR is still effective. They just need to estimate the media payment for 2027 through 2036 based on what they know as of now.

The most reasonable assumption at this point is that ESPN would continue the contract through 2036. If this is the case, then no need to fuss about this.

The second most reasonable assumption would be ESPN and the ACC negotiate and lower the payout. If that is the case, the buyout amount would be discounted a little bit. But it's going to be still quite substantial.

Lastly, I guess there is a very small possibility of the ACC signing with another TV network for 2027 through 2036, Even in this case, I am not sure the media right of FSU (or any other ACC schools) goes back to FSU.

Didn't FSU itself claim that the exit payment would be $572 million? That's their best estimate.

The ACC GoR has espn agreement referenced all over it. How would it hold if say they sign with Fox or NBC. They’d need to draft a new one and have all members sign it.

That's possible but I'm not sure if that happens in 2027, that would invalidate the whole GoR.

It would and it wouldn't, is what I'm saying.
Would the 2016 GOR extension still be in effect? Yes. It's not voided until it expires.

But what does the GOR cover? "Those rights necessary for the conference to perform ..... the ESPN Agreement." If ESPN doesn't pick up their option, or opts out, then the ACC has no obligations under the agreement. Which means that no rights get granted to the ACC.

The Big 12 Grant of Rights specifically carved out the Retained Rights, the one football game reserved to each school. Those games were not under the ESPN-Fox-Big 12 contracts. If ESPN opts out of the ACC contract in 2017, effectively, all of the games become Retained Rights.

(12-26-2023 05:20 PM)BeepBeepJeep Wrote:  Probably doesn't matter. If there's no agreement past 2027, then it'll look like the PAC10 getting pulled apart so they'll have enough votes to dissolve the conference and end the GOR.

Would be pretty funny if ESPN decided that the value of the ACC had dropped so much, even at full strength, that they prefer to renegotiate rather than renew in 2027.

(12-26-2023 08:34 PM)Crayton Wrote:  If ESPN declines and “if” the GOR was contingent on the media deal (as the OP ponders), there really is no need for a lawsuit. This may easily explain why it is not mentioned by FSU. They are operating under the likelihood that ESPN re-ups. Otherwise they’d just follow the OU/UT playbook, announce for ‘27 and negotiate a year early.


It’d be interesting if ESPN has incentive to jailbreak the ACC. Could they save money paying 14 football schools in the ACC vs. moving 4 to the SEC? Don’t think they can telegraph this to FSU without risking tampering charges.

I've mathed out that math before, and assuming that the SEC and Big 12 have pro-rata clauses, it costs ESPN more money.

Keep the ACC $20M * 17 = $340M from ESPN to ACC.
Minus half of the profits of the ACC Network (we're all assuming a 50-50 split) About $182M last year (13*14). So ESPN's net cost for keeping the ACC is $340M - $180M = $160M a year. That increases as the cable bundle shrinks and the ACC Network profits shrink.

Move 4 schools to the SEC, that's about 4*$75 = $300M. $300M is more than $160M. I don't think you close that gap with better matchups.

(12-26-2023 06:34 PM)Garrettabc Wrote:  How bout this scenario:

ESPN does not extend the ACC contract past 2026.

Clemson, Miami, UNC and others bail.

ACC goes to open market.

Open market offers $15m a year.

The ACC takes it.

FSU, Clemson, Miami, UNC and others only owes $15m per year until 2036.

Is that how it works?

They'd owe whatever the ACC wanted to charge them to buy the rights. However, as evidenced by the fact that FSU has not, in fact, given notice of intent to withdraw from the Conference, nobody is going to leave without sorting through the rights first. I'd go so far as to say that the strongest thing about the GoR is that nobody is willing to roll the dice and leave first then sue or negotiate to try to get their rights back later.

(12-26-2023 06:02 PM)Skyhawk Wrote:  Someone in another thread suggested that one of the things a judge may ask, is to ask if espn is exercising their right to the unilateral extension.

I think answering that question puts espn in a position that perhaps they might not want to be in. I could see a "no" happen there.

If they say "yes", they will get dragged into this FSU vs ACC fight

If they say "no", they avoid most of it.

And they have the cover of saying that it's a cost-cutting measure, as Disney is billions in debt...

I’m not a lawyer, but I don’t know how a legal system based on hypotheticals can keep a straight face, barring some previously analogous case. ESPN would not even answer it to avoid getting dragged in.

(12-26-2023 06:20 PM)Frank the Tank Wrote:  Guys - this is 100% the GOR still has the same effect until 2036 under the contract. That is how the “Term” is defined.

A GOR does NOT need to be the same length as the TV contract. Repeat: they do NOT need to be the same.

You're right. If the GOR were written to include the TV rights to all home athletic contests, or all home football and basketball contests, then the ACC would hold FSU's and everyone's TV rights until 2036. The extra ESPN payments from 2016-26 would be the Valuable Consideration that makes the GOR contract between the schools and the conference valid.

But THIS Grant of Rights is only written to cover the rights necessary for the ACC to carry out its contractual responsibilities to ESPN. If ESPN declines the option, the ACC (presumably) has no such responsibilities.

Just like the Big 12 had a carve-out for their "Reserved Rights" games that were not part of the ESPN/Fox contract and not part of the GOR, the whole ACC media package would be not part of the ESPN contract and not part of the GOR.

Quote:Even more glaring is that FSU itself didn’t even try making this argument in its complaint. If THEY don’t even think it’s an argument (and that would be a hypothetically easier argument to to show as it deals with the terms of the contract itself as opposed to significantly more difficult extraneous legal theories), then the fact that fans are even bringing it up is irrelevant. Not even FSU’s own lawyers are attempting that argument.

They don't have to make the argument. And it might cut against their interests to mention it.
1. ESPN is probably going to pick up the option, making the whole discussion moot. Florida STate has to plan for that situation, which is the much more likely one.
2. If ESPN doesn't pick up the option, then FSU is a free agent in 2027. No ESPN contract, no ACC rights to FSU games required to fulfil the ESPN contract. If the ACC wants to try to argue that the GOR covers rights required to fulfil some other contract, they can go to court at that point.
3. Florida STate's antitrust and other hail-mary arguments rely partially on the GOR and Severe Withdrawal Penalty being restraint-of-trade and other kinds of unenforecable. If the $572 number is recalculated for just the next three years, it's the $150m or so exit fee plus $32 * 3 = ~$100M, about $250M.

(12-26-2023 08:46 PM)johnbragg Wrote:  

(12-26-2023 07:01 PM)random asian guy Wrote:  

(12-26-2023 06:51 PM)Acres Wrote:  

(12-26-2023 06:41 PM)random asian guy Wrote:  I don't know why so many people are hung upon that point.

In calculating the buy-out payment, certain estimate/forecast is necessarily involved. For example, the future ACCN payout is not fixed. It depends on the number of subscribers so it's a variable payment. So for the period from 2027 through 2036, the GoR is still effective. They just need to estimate the media payment for 2027 through 2036 based on what they know as of now.

The most reasonable assumption at this point is that ESPN would continue the contract through 2036. If this is the case, then no need to fuss about this.

The second most reasonable assumption would be ESPN and the ACC negotiate and lower the payout. If that is the case, the buyout amount would be discounted a little bit. But it's going to be still quite substantial.

Lastly, I guess there is a very small possibility of the ACC signing with another TV network for 2027 through 2036, Even in this case, I am not sure the media right of FSU (or any other ACC schools) goes back to FSU.

Didn't FSU itself claim that the exit payment would be $572 million? That's their best estimate.

The ACC GoR has espn agreement referenced all over it. How would it hold if say they sign with Fox or NBC. They’d need to draft a new one and have all members sign it.

That's possible but I'm not sure if that happens in 2027, that would invalidate the whole GoR.

It would and it wouldn't, is what I'm saying.
Would the 2016 GOR extension still be in effect? Yes. It's not voided until it expires.

But what does the GOR cover? "Those rights necessary for the conference to perform ..... the ESPN Agreement." If ESPN doesn't pick up their option, or opts out, then the ACC has no obligations under the agreement. Which means that no rights get granted to the ACC.

The Big 12 Grant of Rights specifically carved out the Retained Rights, the one football game reserved to each school. Those games were not under the ESPN-Fox-Big 12 contracts. If ESPN opts out of the ACC contract in 2017, effectively, all of the games become Retained Rights.

That is a theoretically interesting question. But I suspect the option is mere formality and both sides know it.

I don’t know the exact content of the ESPN media contract. For example, if ESPN opts out, there might be some consequences (termination fee or something). I just don’t know without actually reviewing the ESPN contract.

But the GoR doesn’t address that possibility, indicating that the ACC was not concerned about it.

I won’t worry about it.