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Everybody's working for 2022
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JRsec Offline
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Post: #41
RE: Everybody's working for 2022
(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.
(This post was last modified: 09-14-2021 01:51 PM by JRsec.)
09-14-2021 01:30 PM
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Wedge Offline
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Post: #42
RE: Everybody's working for 2022
(09-14-2021 07:44 AM)CliftonAve Wrote:  It's just common sense. I don't know why there have been so many people on this forum who have been preaching Texas and Oklahoma are staying for 4 years. Its like a bad relationship, once your significant other has indicated they are moving on cohabitating afterwards is problematic. Best to kick them to the curb, even it costs you a few bucks on the front end.

Right. And in this case, as in many other relationships that are ending, the Big 12 already has a new significant other (actually four new significant others 02-13-banana) and would like to finalize the divorce so that they can get on with their new relationship.
09-14-2021 01:38 PM
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Post: #43
RE: Everybody's working for 2022
(09-14-2021 01:04 PM)b0ndsj0ns Wrote:  
(09-14-2021 12:51 PM)Attackcoog Wrote:  
(09-14-2021 10:05 AM)Bogg Wrote:  
(09-14-2021 08:08 AM)b0ndsj0ns Wrote:  The UCONN price wasn’t that high because no moves needed to be made in response and no value was lost by having them leave. If those 3 left for 22 the AAC would have to add schools for 22 and there would be a massive negative financial impact. I don’t know what the number would be, don’t think 30, but I’d be stunned if it was not higher than UCONNs total.

UConn also agreed to four home-and-homes with the AAC in basketball as part of that deal (which gets a little dicey now, actually). A straight cash settlement seems likely to be above $20 million each.

That wasnt a factor because it was a complete unknown when the exit fee was negotiated. The exit fee was decided in July of 2019. The AAC hadnt reached any agreement with ESPN on the future of their deal without UConn at that point. In fact, the AAC was still negotiating the effect on the TV deal with ESPN as late as December of 2019. W Virginia paid 20 million to exit early---but W Virginia left when the Big East was still a power conference and still had the C7, Louisville, Rutgers, and hopes of a much higher TV deal. Im guessing 17 million is going to be the price because a precedent has essentially been set with the UConn exit. I think the AAC schools will be gone by 2022.

https://www.cbssports.com/college-footba...port-says/

https://www.orlandosentinel.com/sports/c...story.html

I'm betting it's higher. It is a precedent and I'm sure you guys will try to argue that, but UCONN wasn't a part of the schools that would trigger an automatic look in by ESPN if I remember correctly. It may not have been known for certain how the deal would be impacted by them leaving, but unless you believe Aresco is like legit stupid he had a pretty good idea of the impact before that was agreed to. No one is going to even pretend to argue the TV deal impact of losing UCONN and losing you 3 are going to be the same. Also leaving in 22 would require the AAC to figure out a way to get at least 1 new school in the league in 22 which has an additional cost that wasn't a part of UCONN's departure. I don't see it being under 20 to be out in 22. While I don't advocate for being petty, and don't think it's a good idea to try to burn bridges, there's not really any good legal footing to demand to be out in 1 year for the exact amount UCONN was. That was a settlement and every settlement is different depending on the circumstances it's not binding precedent.

I dont think its burning bridges. Lame duck seasons are good for nobody. The meetings are awkward and tense. Its too easy for leaks to happen. Not to mention---its a bad look for a conference if exiting schools win conference championships. Thats why schools almost always leave within a year of publicly announcing their intent to exit. As for the damage of 3 schools leaving---the exit fee's collected will be 3 times as high as when one schools left. At 17 million a shot---the AAC will have received 68 million in exit fees since 2019 with which to replace schools. The purpose of an exit fee is not to enrich the remaining schools---its liquidated damages designed to allow the conference to overcome any damage caused by the exit of members. The AAC will have 68 million dollars to expedite the arrival of 1 to 4 new teams if they wish to use the money to prevent any problems with 2022 membership. By the way---these 3 exiting teams will soon be voting members in the Big 12---so---I would think any concerns about burning bridges would go both ways.

UT/OU may be the exception when it comes to exiting quickly---and the reason would simply be cost. Unless some sort of innovative solution is found, the exit fees just look too high to overcome--making an early 2022 exit difficult to see. The only way I see it happening is if the Big12 is willing to move on despite the fact they make less money in doing so.
(This post was last modified: 09-14-2021 02:04 PM by Attackcoog.)
09-14-2021 01:56 PM
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Post: #44
RE: Everybody's working for 2022
(09-14-2021 11:58 AM)quo vadis Wrote:  
(09-14-2021 11:14 AM)Crayton Wrote:  
(09-14-2021 09:51 AM)Jared7 Wrote:  
(09-14-2021 09:47 AM)Crayton Wrote:  
(09-14-2021 09:36 AM)Jared7 Wrote:  No, the bylaws say that withholdings start immediately after the Notice of Withdrawal was given which commences the Interim Period. That is set to last for 4 years and it's $160 million per school. Blatantly misrepresenting what the bylaws actually say is par for the course for UT, who blatantly breached a 99-year commitment and is now trying to get out of paying what they owe. And if they leave 3 years early, it'll be whatever they earn in the SEC; which would mean much more than $160 million each.

The withholding begins immediately, for good reason, but the maximum sum that will be withheld is still 2 years.

The GOR is a different beast; best guess now is that they'll still get paid through the Big 12 contract (playing SEC teams), and the SEC will gain their rights in 2025.

What provision in the bylaws says that? The Interim Period commences and withholdings last until actual withdrawal. That's 4 years - not 2. Is Florida a party to this contract? Is the SEC? The GOR component will be more than $40 million per year (each). Best guess now is that UT and OU will owe much more than the $160 million they already owe.

"Withhold" means the money actually belongs to Texas, but is kept in anticipation of being payed something, in this case: exit fees. Exit fees are equal to 2 years worth of media payouts. The Big 12 cannot withhold more than the exit fees. Naturally, the Big 12 should not wait until 2023 to start withholding and should start immediately, because as we see exit dates can change and it is better to get the money up front than to risk being stiffed later.

There is no mechanism (currently) by which Texas can retrieve their media rights; the Big 12 owns them. Texas, if they start play in the SEC before 2025, cannot give those rights to the SEC; the Big 12 owns them. BUT, because the Big 12 is still selling Texas home games to their media partners, they are also still paying Texas for those rights (subject to the withholding mentioned above).

Now, if Texas wants their media rights to be packaged with the SEC contract (and receive the larger payout that comes with it), they can TRY and buy them back from the Big 12. But the price may be prohibitive because estimates have the price as almost a quarter of the Big 12's existing media value.

The SEC's media value won't increase appreciably until they have those rights; 8 OUT games in other SEC stadiums will be roughly equal to the 8 teams sent to OUT stadiums. So, Texas won't see a revenue increase (maybe bowl payments? a nominal cut of the CCG money?) until their rights are transferred, likely in 2025.

I tend to agree. IMO, the bylaws seem to contemplate two year's worth of withholdings as the buyout amount. The bylaws seem to call the "interim period" between notice and effective withdrawal as basically a two-year period. The logic seems to be - buyout amount is value of final two year's distribution, school gives notice two years in advance, buyout fee is withheld for those two years to pay off the buyout at the time the school exits.

It is fuzzy though because they also say that the moment you give notice, you don't collect any more distributions. The bylaws seem to assume that notice would be given two years in advance. They don't seem to have contemplated a school giving four year's notice.

I suspect it will end up being two year's worth of distribution, because otherwise, if say Kansas State were to "give notice" that they intend to leave in 2035, the L12 could seemingly withhold payment to them for the next 14 years, which IMO is nonsensical and could not survive in court. I suspect TX and OU will maintain that in July they "gave notice that they will give notice" in July 2023 and if the L12 challenges that and says it is withholding all four years, then we end up in court. I think the L12 will lose that, as it doesn't pass the smell test (e.g. K-State hypothetical) and it would seem that it benefits a conference to know sooner rather than later than a school is leaving, so there's no real grounds for withholding for longer periods, that seems punitive. E.g., in this case, the early notice has allowed the L8 to make plans and expand with new members now, to become an L12. Better that it have that information now than in 2023, I would say.

FWIW, I expect a deal to be reached for them to leave sooner than 2025, probably 2023. What the dollars will be, I don't know. I suspect it will be about $80m - $100m each, but we shall see.

^This. The idea that if you let them know earlier, they keep more--That is just nonsensical and doesn't fit in the context of the agreement.
09-14-2021 02:17 PM
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b0ndsj0ns Offline
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Post: #45
RE: Everybody's working for 2022
(09-14-2021 01:56 PM)Attackcoog Wrote:  
(09-14-2021 01:04 PM)b0ndsj0ns Wrote:  
(09-14-2021 12:51 PM)Attackcoog Wrote:  
(09-14-2021 10:05 AM)Bogg Wrote:  
(09-14-2021 08:08 AM)b0ndsj0ns Wrote:  The UCONN price wasn’t that high because no moves needed to be made in response and no value was lost by having them leave. If those 3 left for 22 the AAC would have to add schools for 22 and there would be a massive negative financial impact. I don’t know what the number would be, don’t think 30, but I’d be stunned if it was not higher than UCONNs total.

UConn also agreed to four home-and-homes with the AAC in basketball as part of that deal (which gets a little dicey now, actually). A straight cash settlement seems likely to be above $20 million each.

That wasnt a factor because it was a complete unknown when the exit fee was negotiated. The exit fee was decided in July of 2019. The AAC hadnt reached any agreement with ESPN on the future of their deal without UConn at that point. In fact, the AAC was still negotiating the effect on the TV deal with ESPN as late as December of 2019. W Virginia paid 20 million to exit early---but W Virginia left when the Big East was still a power conference and still had the C7, Louisville, Rutgers, and hopes of a much higher TV deal. Im guessing 17 million is going to be the price because a precedent has essentially been set with the UConn exit. I think the AAC schools will be gone by 2022.

https://www.cbssports.com/college-footba...port-says/

https://www.orlandosentinel.com/sports/c...story.html

I'm betting it's higher. It is a precedent and I'm sure you guys will try to argue that, but UCONN wasn't a part of the schools that would trigger an automatic look in by ESPN if I remember correctly. It may not have been known for certain how the deal would be impacted by them leaving, but unless you believe Aresco is like legit stupid he had a pretty good idea of the impact before that was agreed to. No one is going to even pretend to argue the TV deal impact of losing UCONN and losing you 3 are going to be the same. Also leaving in 22 would require the AAC to figure out a way to get at least 1 new school in the league in 22 which has an additional cost that wasn't a part of UCONN's departure. I don't see it being under 20 to be out in 22. While I don't advocate for being petty, and don't think it's a good idea to try to burn bridges, there's not really any good legal footing to demand to be out in 1 year for the exact amount UCONN was. That was a settlement and every settlement is different depending on the circumstances it's not binding precedent.

I dont think its burning bridges. Lame duck seasons are good for nobody. The meetings are awkward and tense. Its too easy for leaks to happen. Not to mention---its a bad look for a conference if exiting schools win conference championships. Thats why schools almost always leave within a year of publicly announcing their intent to exit. As for the damage of 3 schools leaving---the exit fee's collected will be 3 times as high as when one schools left. At 17 million a shot---the AAC will have received 68 million in exit fees since 2019 with which to replace schools. The purpose of an exit fee is not to enrich the remaining schools---its liquidated damages designed to allow the conference to overcome any damage caused by the exit of members. The AAC will have 68 million dollars to expedite the arrival of 1 to 4 new teams if they wish to use the money to prevent any problems with 2022 membership. By the way---these 3 exiting teams will soon be voting members in the Big 12---so---I would think any concerns about burning bridges would go both ways.

UT/OU may be the exception when it comes to exiting quickly---and the reason would simply be cost. Unless some sort of innovative solution is found, the exit fees just look too high to overcome--making an early 2022 exit difficult to see. The only way I see it happening is if the Big12 is willing to move on despite the fact they make less money in doing so.

That's what I meant by burning bridges not burning bridges the other way. Also the question is do I believe the additional 7 million per school is going to cover the damages to the TV deal during those 2 seasons you left early(the 10 million is a sunk cost baked into the 27 month waiting period)? I'd love to think so but if the overall value drops by half it doesn't come close. The lame duck seasons are good for the AAC if it gives schools an additional year or 2 of 6-7 million a year payouts vs starting 2-4 million payouts sooner. If ESPN immediately dropped the TV deal to 3 million per school in 2022 that's liquidated damages to the league of roughly 30 million for that year. That's 60 million for the 2 years the 27 month notice period would cover. So unless you are going to argue I'm way off in my prediction of how much the AAC TV deal is gonna drop that number doesn't come close to covering the financial damages of those 3 leaving 2 football seasons earlier. That's what the negotiation is about, how much extra do you need to pay to leave 2 football seasons earlier. The 10 million is the cost to be out by the 2024 football season, how much liquidated damages does it cause the remaining schools each year sooner you push that. I'm guessing close to 30 million a year, hope I'm wrong.
(This post was last modified: 09-14-2021 02:53 PM by b0ndsj0ns.)
09-14-2021 02:42 PM
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Post: #46
RE: Everybody's working for 2022
(09-14-2021 01:05 PM)Cyniclone Wrote:  On the other hand, perhaps Texas is having buyers’ remorse about the SEC




Haha!
09-14-2021 02:49 PM
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Post: #47
RE: Everybody's working for 2022
(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.
09-14-2021 03:24 PM
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Post: #48
RE: Everybody's working for 2022
(09-14-2021 01:56 PM)Attackcoog Wrote:  
(09-14-2021 01:04 PM)b0ndsj0ns Wrote:  
(09-14-2021 12:51 PM)Attackcoog Wrote:  
(09-14-2021 10:05 AM)Bogg Wrote:  
(09-14-2021 08:08 AM)b0ndsj0ns Wrote:  The UCONN price wasn’t that high because no moves needed to be made in response and no value was lost by having them leave. If those 3 left for 22 the AAC would have to add schools for 22 and there would be a massive negative financial impact. I don’t know what the number would be, don’t think 30, but I’d be stunned if it was not higher than UCONNs total.

UConn also agreed to four home-and-homes with the AAC in basketball as part of that deal (which gets a little dicey now, actually). A straight cash settlement seems likely to be above $20 million each.

That wasnt a factor because it was a complete unknown when the exit fee was negotiated. The exit fee was decided in July of 2019. The AAC hadnt reached any agreement with ESPN on the future of their deal without UConn at that point. In fact, the AAC was still negotiating the effect on the TV deal with ESPN as late as December of 2019. W Virginia paid 20 million to exit early---but W Virginia left when the Big East was still a power conference and still had the C7, Louisville, Rutgers, and hopes of a much higher TV deal. Im guessing 17 million is going to be the price because a precedent has essentially been set with the UConn exit. I think the AAC schools will be gone by 2022.

https://www.cbssports.com/college-footba...port-says/

https://www.orlandosentinel.com/sports/c...story.html

I'm betting it's higher. It is a precedent and I'm sure you guys will try to argue that, but UCONN wasn't a part of the schools that would trigger an automatic look in by ESPN if I remember correctly. It may not have been known for certain how the deal would be impacted by them leaving, but unless you believe Aresco is like legit stupid he had a pretty good idea of the impact before that was agreed to. No one is going to even pretend to argue the TV deal impact of losing UCONN and losing you 3 are going to be the same. Also leaving in 22 would require the AAC to figure out a way to get at least 1 new school in the league in 22 which has an additional cost that wasn't a part of UCONN's departure. I don't see it being under 20 to be out in 22. While I don't advocate for being petty, and don't think it's a good idea to try to burn bridges, there's not really any good legal footing to demand to be out in 1 year for the exact amount UCONN was. That was a settlement and every settlement is different depending on the circumstances it's not binding precedent.

I dont think its burning bridges. Lame duck seasons are good for nobody. The meetings are awkward and tense. Its too easy for leaks to happen. Not to mention---its a bad look for a conference if exiting schools win conference championships. Thats why schools almost always leave within a year of publicly announcing their intent to exit. As for the damage of 3 schools leaving---the exit fee's collected will be 3 times as high as when one schools left. At 17 million a shot---the AAC will have received 68 million in exit fees since 2019 with which to replace schools. The purpose of an exit fee is not to enrich the remaining schools---its liquidated damages designed to allow the conference to overcome any damage caused by the exit of members. The AAC will have 68 million dollars to expedite the arrival of 1 to 4 new teams if they wish to use the money to prevent any problems with 2022 membership. By the way---these 3 exiting teams will soon be voting members in the Big 12---so---I would think any concerns about burning bridges would go both ways.

UT/OU may be the exception when it comes to exiting quickly---and the reason would simply be cost. Unless some sort of innovative solution is found, the exit fees just look too high to overcome--making an early 2022 exit difficult to see. The only way I see it happening is if the Big12 is willing to move on despite the fact they make less money in doing so.

Depends on how much the R8 lose with their new contract. The less they lose the easier it is to move quickly. If the new deal is $25 million/school, that's just $24 million lost a year (based on Bowlsby's $28 million).
09-14-2021 03:27 PM
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Jared7 Offline
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Post: #49
RE: Everybody's working for 2022
(09-14-2021 01:30 PM)JRsec Wrote:  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.

1. The Big 12 situation has a unique set of bylaws (post 2012) and involves a GOR. To date, neither has been tested as yet. Other examples are not relevant here.

2. The Big 12 will withhold and keep UT's and OU's revenues per the bylaws. UT and OU have already breached the bylaws. If they don't like the withholdings, they can sue, but it won't be an orderly transition like Sankey wants.

3. The bylaws govern the withholdings and the revenues will be withheld. Artists do not sign by-laws in addition to GOR's so this case is unique. The GOR is a separate issue and only applies if UT and OU leave early; if they don't, 4 years' withholdings apply; if they do, withholdings apply until they leave and then they, per the settlement, will separately owe a GOR component (which will be higher than the withholdings would have been). If they leave without a settlement, there will be a lawsuit, a TRO and an injunction and any further damages will be added to the amounts owed.

4. If UT and OU attempt to sue the Big 12 about the withholdings, they will face a sovereign immunity defense because they are, in effect, suing state schools (KU; ISU; WVa.; OSU). They will probably win this because it has been tested many many times in many many cases and there is a universally recognized exception to such defenses when the supposed sovereign entity engages in commercial activities. But winning on that preliminary issue would take time and a lot of legal expenses and wouldn't be the orderly transition Sankey wants. Only after that is resolved would a court get to the merits of how much UT and OU owe for breaching their 99-year commitment.

5. Yet again, artists in the entertainment industry are not covered by bylaws that spell out who gets what. UT and OU agreed to abide by these bylaws for 99 years. The Buyout Amounts are the Buyout Amounts and are not exit fees nor will they be converted into exit fees. Capitalizing "Sovereign Immunity" doesn't change its legal import and it would be UT and OU suing sovereign entities; not the other way around. The contract has already been broken by UT and OU - the Buyout Amounts constitute the already-agreed damages for that.

6. The Big 12 will be "managing" the UT and OU accounts by withholding their agreed Buyout Amounts starting next June. The SEC has nothing to do with it.

7. The Big 12 is due damages from UT and OU's breach of the 99-year commitment. The bylaws specify the amount and procedure for determining the amount. That is 4 years' worth of withholdings (or roughly $160 million). Each. Further damages such as breaching the GOR or hurting gate money or damaging reputation can and indeed will be added to that if UT and OU continue to try to damage the Big 12.
(This post was last modified: 09-14-2021 03:41 PM by Jared7.)
09-14-2021 03:35 PM
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Post: #50
RE: Everybody's working for 2022
(09-14-2021 03:35 PM)Jared7 Wrote:  
(09-14-2021 01:30 PM)JRsec Wrote:  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.

1. The Big 12 situation has a unique set of bylaws (post 2012) and involves a GOR. To date, neither has been tested as yet. Other examples are not relevant here.

2. The Big 12 will withhold and keep UT's and OU's revenues per the bylaws. UT and OU have already breached the bylaws. If they don't like the withholdings, they can sue, but it won't be an orderly transition like Sankey wants.

3. The bylaws govern the withholdings and the revenues will be withheld. Artists do not sign by-laws in addition to GOR's so this case is unique. The GOR is a separate issue and only applies if UT and OU leave early; if they don't, 4 years' withholdings apply; if they do, withholdings apply until they leave and then they, per the settlement, will separately owe a GOR component (which will be higher than the withholdings would have been). If they leave without a settlement, there will be a lawsuit, a TRO and an injunction and any further damages will be added to the amounts owed.

4. If UT and OU attempt to sue the Big 12 about the withholdings, they will face a sovereign immunity defense because they are, in effect, suing state schools (KU; ISU; WVa.; OSU). They will probably win this because it has been tested many many times in many many cases and there is a universally recognized exception to such defenses when the supposed sovereign entity engages in commercial activities. But winning on that preliminary issue would take time and a lot of legal expenses and wouldn't be the orderly transition Sankey wants. Only after that is resolved would a court get to the merits of how much UT and OU owe for breaching their 99-year commitment.

5. Yet again, artists in the entertainment industry are not covered by bylaws that spell out who gets what. UT and OU agreed to abide by these bylaws for 99 years. The Buyout Amounts are the Buyout Amounts and are not exit fees nor will they be converted into exit fees. Capitalizing "Sovereign Immunity" doesn't change its legal import and it would be UT and OU suing sovereign entities; not the other way around. The contract has already been broken by UT and OU - the Buyout Amounts constitute the already-agreed damages for that.

6. The Big 12 will be "managing" the UT and OU accounts by withholding their agreed Buyout Amounts starting next June. The SEC has nothing to do with it.

7. The Big 12 is due damages from UT and OU's breach of the 99-year commitment. The bylaws specify the amount and procedure for determining the amount. That is 4 years' worth of withholdings (or roughly $160 million). Each. Further damages such as breaching the GOR or hurting gate money or damaging reputation can and indeed will be added to that if UT and OU continue to try to damage the Big 12.

Precedent and law will decide all of it, period. Many contracts are written with unenforceable clauses within them.
09-14-2021 03:50 PM
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Post: #51
RE: Everybody's working for 2022
(09-14-2021 03:50 PM)JRsec Wrote:  
(09-14-2021 03:35 PM)Jared7 Wrote:  
(09-14-2021 01:30 PM)JRsec Wrote:  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.

1. The Big 12 situation has a unique set of bylaws (post 2012) and involves a GOR. To date, neither has been tested as yet. Other examples are not relevant here.

2. The Big 12 will withhold and keep UT's and OU's revenues per the bylaws. UT and OU have already breached the bylaws. If they don't like the withholdings, they can sue, but it won't be an orderly transition like Sankey wants.

3. The bylaws govern the withholdings and the revenues will be withheld. Artists do not sign by-laws in addition to GOR's so this case is unique. The GOR is a separate issue and only applies if UT and OU leave early; if they don't, 4 years' withholdings apply; if they do, withholdings apply until they leave and then they, per the settlement, will separately owe a GOR component (which will be higher than the withholdings would have been). If they leave without a settlement, there will be a lawsuit, a TRO and an injunction and any further damages will be added to the amounts owed.

4. If UT and OU attempt to sue the Big 12 about the withholdings, they will face a sovereign immunity defense because they are, in effect, suing state schools (KU; ISU; WVa.; OSU). They will probably win this because it has been tested many many times in many many cases and there is a universally recognized exception to such defenses when the supposed sovereign entity engages in commercial activities. But winning on that preliminary issue would take time and a lot of legal expenses and wouldn't be the orderly transition Sankey wants. Only after that is resolved would a court get to the merits of how much UT and OU owe for breaching their 99-year commitment.

5. Yet again, artists in the entertainment industry are not covered by bylaws that spell out who gets what. UT and OU agreed to abide by these bylaws for 99 years. The Buyout Amounts are the Buyout Amounts and are not exit fees nor will they be converted into exit fees. Capitalizing "Sovereign Immunity" doesn't change its legal import and it would be UT and OU suing sovereign entities; not the other way around. The contract has already been broken by UT and OU - the Buyout Amounts constitute the already-agreed damages for that.

6. The Big 12 will be "managing" the UT and OU accounts by withholding their agreed Buyout Amounts starting next June. The SEC has nothing to do with it.

7. The Big 12 is due damages from UT and OU's breach of the 99-year commitment. The bylaws specify the amount and procedure for determining the amount. That is 4 years' worth of withholdings (or roughly $160 million). Each. Further damages such as breaching the GOR or hurting gate money or damaging reputation can and indeed will be added to that if UT and OU continue to try to damage the Big 12.

Precedent and law will decide all of it, period. Many contracts are written with unenforceable clauses within them.

I agree with this. That's why I think these GORs might be vulnerable - the way I understand it, some around here (don't remember exactly who) say that if a team leaves a conference, the conference holding its GOR gets to get paid by the media company for their games, but then the conference does not have to pay the leaving school. That in effect the school is working for nothing for the duration of the GOR.

I have trouble believing a court will uphold that. I suspect a court will likely say "look, you own this school's media rights. That means the money they make from their media goes to you, but of course you also have to pay them for those rights. You don't get to not pay them just because you're mad they are leaving, even if that's what your conferences rules say. And no, paying them revenue for prior years doesn't get you off the hook either, because we're talking about future years" or somesuch.

People have talked about analogies to other areas of intellectual property, like copyrights, but I don't know of any situations like that - e.g., Sony has a "GOR" from Marvel for the movie rights to the Spiderman character, and allegedly, it is very lopsided, Sony paid a then-desperate Marvel a relative pittance, and now they make big money off Spiderman movies. But still, IIRC, they have to pay Marvel for those rights. They can't just not pay them.

But IANAL, and as you say, courts will decide all of this in the end.
(This post was last modified: 09-14-2021 04:05 PM by quo vadis.)
09-14-2021 04:00 PM
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Jared7 Offline
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Post: #52
RE: Everybody's working for 2022
(09-14-2021 03:34 PM)quo vadis Wrote:  And about TX and OU: Do you think that Texas and Oklahoma, presumably with highly-skilled lawyers, would make the mistake of giving notice (in the bylaws sense) two extra years in advance, thereby costing each of them the whopping sum of $80 million extra dollars each? That they just blundered in to that despite maybe having rooms full of JD and PhD decision-makers? People who maybe helped write these same bylaws back in 2012?

Or do you think maybe that they did know they would incur $80 million in extra buyout costs by "giving notice" this July, but just went ahead and announced anyway out of, I don't know, some sense of pride or ego? Even though it's not apparent what pride or ego value attaches to announcing now as opposed to 2023, much less $80 million dollars worth each?

I'm curious about how you view this whole thing.
My view is that UT and OU wanted to make a splashy announcement in July and announce that they were not extending the GOR and accepting the SEC invitation. They wanted to do this so that they could lord it over the college football world starting then and continuing forever. At the time, they thought that the "exit fee" would be $80 million each - the earliest reports from their mouthpieces said that. Only after the announcement did they realize that the by-laws provided differently. When numerous other outlets either read the publicly-available bylaws or talked to actual members of the Big 12. And that's when we began to see the $160 million figure reported. And that is the reason they are currently attempting to maintain the fiction that they haven't given effective notice of withdrawal. They are not only breaching their 99-year commitment, they are attempting to do so by paying as little as they possibly can in doing so.

The Big 12, which still has members and not just administrators and an enforceable GOR with ample consideration, has now attempted to mitigate the damages by expanding, with a target date of 2023 for the newest members to join the league. UT (and OU), however, are not satisfied with that and are now leaking stories about how "everyone" is aiming at 2022 when everyone isn't. If they really are targeting 2022, they will have to pay for it. In amounts equal or close to the 4 years' worth of withholdings previously agreed to plus a GOR component which will be more than that if they leave early.
09-14-2021 04:08 PM
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quo vadis Online
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Post: #53
RE: Everybody's working for 2022
(09-14-2021 04:08 PM)Jared7 Wrote:  
(09-14-2021 03:34 PM)quo vadis Wrote:  And about TX and OU: Do you think that Texas and Oklahoma, presumably with highly-skilled lawyers, would make the mistake of giving notice (in the bylaws sense) two extra years in advance, thereby costing each of them the whopping sum of $80 million extra dollars each? That they just blundered in to that despite maybe having rooms full of JD and PhD decision-makers? People who maybe helped write these same bylaws back in 2012?

Or do you think maybe that they did know they would incur $80 million in extra buyout costs by "giving notice" this July, but just went ahead and announced anyway out of, I don't know, some sense of pride or ego? Even though it's not apparent what pride or ego value attaches to announcing now as opposed to 2023, much less $80 million dollars worth each?

I'm curious about how you view this whole thing.
My view is that UT and OU wanted to make a splashy announcement in July and announce that they were not extending the GOR and accepting the SEC invitation. They wanted to do this so that they could lord it over the college football world starting then and continuing forever. At the time, they thought that the "exit fee" would be $80 million each - the earliest reports from their mouthpieces said that. Only after the announcement did they realize that the by-laws provided differently. When numerous other outlets either read the publicly-available bylaws or talked to actual members of the Big 12. And that's when we began to see the $160 million figure reported. And that is the reason they are currently attempting to maintain the fiction that they haven't given effective notice of withdrawal. They are not only breaching their 99-year commitment, they are attempting to do so by paying as little as they possibly can in doing so.

The Big 12, which still has members and not just administrators and an enforceable GOR with ample consideration, has now attempted to mitigate the damages by expanding, with a target date of 2023 for the newest members to join the league. UT (and OU), however, are not satisfied with that and are now leaking stories about how "everyone" is aiming at 2022 when everyone isn't. If they really are targeting 2022, they will have to pay for it. In amounts equal or close to the 4 years' worth of withholdings previously agreed to plus a GOR component which will be more than that if they leave early.

OK, thanks. I guess we shall see how it plays out.
(This post was last modified: 09-14-2021 04:13 PM by quo vadis.)
09-14-2021 04:13 PM
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Post: #54
RE: Everybody's working for 2022
UConn was $17m and that's what it will be for the three AAC schools. The price is set.

Texas and Oklahoma is $80m simply to leave in 2025. It could be as much as $100m for each year prior.
09-14-2021 04:14 PM
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Jared7 Offline
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Post: #55
RE: Everybody's working for 2022
(09-14-2021 03:50 PM)JRsec Wrote:  Precedent and law will decide all of it, period. Many contracts are written with unenforceable clauses within them.
Actually, I think a settlement is much more likely now that the Big 12 has announced its expansion plans. For 2023; not 2022. But the enforceable provisions in the contract mean that UT and OU will have to pay for it if they want to leave early.
09-14-2021 04:18 PM
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Post: #56
RE: Everybody's working for 2022
(09-14-2021 04:14 PM)Stugray2 Wrote:  UConn was $17m and that's what it will be for the three AAC schools. The price is set.

Texas and Oklahoma is $80m simply to leave in 2025. It could be as much as $100m for each year prior.

There is zero precedent to enforce 2 years of media revenue as an exit fee. Collection enforcement alone is deuce difficult.

Almost all contract suits are centered around making all parties as financially whole as is practical and very few are interested in penalties.

Personally I think OU and UT get out for 40 million each in exit fees.

Damages will be where any additional sum comes from. Right now that's 5 million each for 8 schools per year, or 40 million per year split by OU and UT.

Then the issue will be which conference wants, or is awarded, rights control. There is no court that will permit non payment to a performing (playing) school. This never existed in GOR's used in entertainment and dang sure won't happen to a State supported school.

The main issue that could be faced should this go to court is efficacy over a state school. The B12 will have zero friends if they push this to decision and the court rules in favor of Sovereign Immunity, or simply declares that state entities can't enter into GOR's. If that happens it's open bidding on realignment and the winners won't be fans, schools, or conferences, but rather carriers with deep pockets.

The uncertainty over the novel use of GOR's in college sports is not an issue anyone wants to push. They'll settle and likely for much less than fans are predicting.

What made GOR's binding in 2011-2 was the revenue gap between the P5 was at 10 million and under. Lawsuits would eat up any gain. Now the difference which will be in place by 2024 will be as much as 40 million. Now it is worth the cost of suits. So what was unthinkable and impractical in 2011-2 is now necessary and could NET 10's of millions for the effort.

So risk / reward as an advantage has shifted from the conference to the school. Texas has more to gain and the B12 even more to lose in a lawsuit. So they'll settle.
09-14-2021 04:35 PM
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Jared7 Offline
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Post: #57
RE: Everybody's working for 2022
(09-14-2021 04:14 PM)Stugray2 Wrote:  UConn was $17m and that's what it will be for the three AAC schools. The price is set.

Texas and Oklahoma is $80m simply to leave in 2025. It could be as much as $100m for each year prior.
There is zero precedent for schools breaching 99-year commitments and not paying Buyout Amounts specified in enforceable bylaws.

Almost all contract suits enforce provisions unless they are unreasonable.

Personally, I think UT and OU are going to pay close to what they owe ($160 million).

Damages for breaching the GOR might add more.

The bylaws specify that the Big 12 controls its revenues and any amounts withheld.

The main issue if this goes to court would be whether the agreed-upon Buyouts are reasonable. Sovereign immunity is a red herring that has little relevance but UT would have zero friends if it sued state entities over what are clearly commercial activities. And if they lose and GOR's gain legal strength, it'll hurt the SEC's future plans to raid the ACC (or others with GOR's).

The uncertainty over GOR's is not something that Sankey wishes to be tested in court. UT will settle and likely for a lot more than what Longhorn and (apparently SEC fans) are hoping for.

So risk/reward has shifted to the Big 12 here - UT has a lot to lose and little to gain by going forward with a lawsuit against sovereign entities when they can easily avoid it by settling for a higher amount than anticipated. So, they'll settle.
(This post was last modified: 09-14-2021 04:57 PM by Jared7.)
09-14-2021 04:52 PM
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Post: #58
RE: Everybody's working for 2022
(09-14-2021 11:41 AM)Captain Bearcat Wrote:  
(09-14-2021 09:38 AM)YNot Wrote:  
(09-14-2021 09:20 AM)Captain Bearcat Wrote:  BYU wants to join in 2025. If they join next year, they have to cancel & buy out 18 games over the next 3 years.

Even if they join in 2025, BYU has to buy out 4 games in 2025, 4 in 2026, and 1 in 2028.

Nope. BYU wants to join in 2023. They won't have to buyout much if they start 2023 because they have a cancellation clause in their game contracts that allows them to cancel with no buyout if they join a P5 conference and give 18 months notice...so notice in Spring 2022 for the Fall 2023 games.

They also want to give the WCC two more years (2021-22, 2022-23) as a goodwill gesture to their conference mates.

My hunch is that BYU will keep its 2022 football schedule and then keep, buy out, or reschedule any return road trips for which the first game has already been played in Provo.

There will definitely be some tough scheduling decisions. Do you keep the best games or do you try to put together a manageable OOC schedule? What to do with the three rivalry series - Utah, Utah State, and Boise State?

Okay. If this is true, then the OP is incorrect.

BYU is not going to be in the Big 12 for 2022 unless the Big 12 makes it worth their while ($$$). I doubt the Big 12 wants that; they're not beggars.

I also doubt that the Big 12 wants an 11-team conference for 2022. The Big 12 wants Texas & OU to leave the same year that the new 4 join.

Tom Holmoe mentioned in his interviews after the announcement that 2023 is what seemed to work well for everyone so they don't have to redo schedules in all sports for a new member in 2022 and then do it all over again when the 3 other teams join. So if all or most of the new members came in for 2023 that would be much less work schedule-wise.
09-14-2021 05:03 PM
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Jared7 Offline
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RE: Everybody's working for 2022
(09-14-2021 05:03 PM)f1do Wrote:  
(09-14-2021 11:41 AM)Captain Bearcat Wrote:  
(09-14-2021 09:38 AM)YNot Wrote:  
(09-14-2021 09:20 AM)Captain Bearcat Wrote:  BYU wants to join in 2025. If they join next year, they have to cancel & buy out 18 games over the next 3 years.

Even if they join in 2025, BYU has to buy out 4 games in 2025, 4 in 2026, and 1 in 2028.

Nope. BYU wants to join in 2023. They won't have to buyout much if they start 2023 because they have a cancellation clause in their game contracts that allows them to cancel with no buyout if they join a P5 conference and give 18 months notice...so notice in Spring 2022 for the Fall 2023 games.

They also want to give the WCC two more years (2021-22, 2022-23) as a goodwill gesture to their conference mates.

My hunch is that BYU will keep its 2022 football schedule and then keep, buy out, or reschedule any return road trips for which the first game has already been played in Provo.

There will definitely be some tough scheduling decisions. Do you keep the best games or do you try to put together a manageable OOC schedule? What to do with the three rivalry series - Utah, Utah State, and Boise State?

Okay. If this is true, then the OP is incorrect.

BYU is not going to be in the Big 12 for 2022 unless the Big 12 makes it worth their while ($$$). I doubt the Big 12 wants that; they're not beggars.

I also doubt that the Big 12 wants an 11-team conference for 2022. The Big 12 wants Texas & OU to leave the same year that the new 4 join.

Tom Holmoe mentioned in his interviews after the announcement that 2023 is what seemed to work well for everyone so they don't have to redo schedules in all sports for a new member in 2022 and then do it all over again when the 3 other teams join. So if all or most of the new members came in for 2023 that would be much less work schedule-wise.

Exactly. It is somewhat ironic that the Big 12's negotiations with BYU and Houston have effectively set the target date for UT's and OU's settlement negotiations - 2023. The Big 12's efforts at mitigating the damages have effectively raised the price for a 2022 UT/OU departure, but may have lowered it for 2023. The OP is clearly wrong - "everyone" is looking at 2023; not 2022.
09-14-2021 05:14 PM
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JRsec Offline
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Post: #60
RE: Everybody's working for 2022
(09-14-2021 04:52 PM)Jared7 Wrote:  
(09-14-2021 04:14 PM)Stugray2 Wrote:  UConn was $17m and that's what it will be for the three AAC schools. The price is set.

Texas and Oklahoma is $80m simply to leave in 2025. It could be as much as $100m for each year prior.
There is zero precedent for schools breaching 99-year commitments and not paying Buyout Amounts specified in enforceable bylaws.

Almost all contract suits enforce provisions unless they are unreasonable.

Personally, I think UT and OU are going to pay close to what they owe ($160 million).

Damages for breaching the GOR might add more.

The bylaws specify that the Big 12 controls its revenues and any amounts withheld.

The main issue if this goes to court would be whether the agreed-upon Buyouts are reasonable. Sovereign immunity is a red herring that has little relevance but UT would have zero friends if it sued state entities over what are clearly commercial activities. And if they lose and GOR's gain legal strength, it'll hurt the SEC's future plans to raid the ACC (or others with GOR's).

The uncertainty over GOR's is not something that Sankey wishes to be tested in court. UT will settle and likely for a lot more than what Longhorn and (apparently SEC fans) are hoping for.

So risk/reward has shifted to the Big 12 here - UT has a lot to lose and little to gain by going forward with a lawsuit against sovereign entities when they can easily avoid it by settling for a higher amount than anticipated. So, they'll settle.

Sankey and the SEC aren't impacted whatsoever over a GOR ruling we signed our rights out to ESPN for the contract and the SEC still has no exit fee. The bolded part is merely absurd and so far the totality of you argument is in just contradicting mine.

Check out the GOR cases in the entertainment industry. Look up the exit fees paid by departing schools in the past. Then get back to me. I'll entertain specifics to the contrary.
09-14-2021 05:23 PM
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