(09-14-2021 01:30 PM)JRsec Wrote:  

(09-14-2021 12:58 PM)johnbragg Wrote:  

(09-14-2021 04:50 AM)goofus Wrote:  Lame Duck status is not ideal, but to describe it as horrible is a bit of a stretch. Nobody develops PTSD from having to spend an extra year or 2 in an old conference. If the money does not make sense to move early, schools will stick it out.

I hear different things regarding Tex and Ok buyouts of the GOR. Would it be $80M total per team to leave by 2022, or would it be $80M per year per school?

According to the bylaws, the Big 12 buyout is 2 years of league revenue distributions, about $80M.

But by another reading of the bylaws, once you announce your withdrawal, you stop getting revenue distributions. This was clearly designed as a way to enforce the $80M or so exit fee, but the way it's written, Oklahoma and Texas don't get another dime.

And, of course, there's the Grant of Rights, which has no early-exit clauses at all. As written, the Big 12 just owns UT and OU's TV rights until 2025, in return for Valuable Considerations which have never been clear to me but I am assured by smart people will (probably) stand up in court.

So there are a couple of interrelated questions:
Q: How big is the buyout to leave the Big 12?
A: $80M minimum.
Q: Can UT and OU work a deal to leave early? How much would it cost?
A: Possibly.
Q: Will the Grant of Rights hold up?
A: Frank The TAnk is a lawyer, he says yes. Clay Travis is (was?) a lawyer, says no.

One possible agreement for UT and OU to leave early is for UT and OU to agree to not challenge the GOR, leaving their home games under the Big 12 contract.

My guess is that UT and OU agree to STAY in the Big 12 until 2025, and in return the Big 12 agrees to structure their exit fee by withholding half and paying half of the UT/OU distributions for the 4 lame duck years.

1. To date no departing school has lost more than 1 year's media revenue, or more than un-distributed media revenues (meaning contracted media revenue plus any bowl or tourney creds).

So I don't see UT or OU losing more than 40 million and anticipate they will leave early.

2. The Big 12 may keep GOR revenues even if OU and UT are playing in the SEC, but OU and UT must be paid the B12 share or they breach the contract.

3. Get 50 lawyers together and ask them an opinion and you'll get 50 shades of gray without the sex.

Frank is arguing the validity of GOR's and Clay is arguing Sovereign immunity which has not been tested in regard to state owned schools. GOR's have long been standard in the entertainment industry and are valid. By application an artist who switches labels or agencies still gets paid. No pay means no performance. If you extrapolate the scenario to college football the Big 12 has rights to Texas and Oklahoma until the end of the 2024-5 season. So they earn that money whether OU and UT play in the B12 or not. But the artist gets paid full B12 shares or the contract is void. No pay means no contract. OU and UT perform, and perform in the SEC. But if the B12 receives the revenue they have to pay OU and UT to honor the contract. What the SEC benefits from are the road games at SEC venues where OU and UT draw the extra eyeball.

4. The SEC doesn't earn the full value of OU and UT until they are free of the GOR.

5. If by the end of this year the B12 fails to pay OU and UT the contract is broken unless OU and UT have announced that they will be playing in the SEC in 2022. At that point the withheld revenue becomes an exit fee. And, the B12's claim upon the rights and revenue derived from it would be the court issue and if it was determined that state schools are not covered under Sovereign Immunity then they (B12) would receive that revenue until the end of June 2025 (while paying OU and UT a B12 share) and if OU and UT are covered under Sovereign Immunity then OU and UT owe nothing more to the Big 12, and state schools everywhere would be escaping their GOR's and private schools wouldn't.

6. In the entertainment industry if a performer changes labels or agencies the question is not about whether the performer gets paid, or even which venues they perform in, but which contracted label or agency gets paid. So the real question is not if OU and UT get paid, they will, or even where they perform, but rather is it the B12 or SEC which enforces the contract and controls the disbursement. The SEC is not claiming that right until the 2025-6 season, or until OU and UT are legally acknowledged as part of the SEC whichever comes first.

So what is to be decided is whether the Big 12 wants to manage OU and UT's account until June 30, 2025, or settles and lets the SEC handle it.

7. The B12 schools are due damages. Right now if 8 schools suffer a 5 million dollar loss of revenue if OU and UT opt to play in the SEC in 2022 they will be due 40 million a year for 3 years in damages total (for both schools together). So exit fees and loss of revenue would amount to 200 million if the exit fee precedent of 1 year is upheld and 280 million if it is not. That's 140 million each.

Loss of gate would be limited to the proven loss of the difference between the 8,000 travel tickets that OU and UT are typically allotted and what their replacements buy. That's a nebulous difference.

Regarding #1. There has never been a buyout where one year's revenue has been so high.