The ACC Lawsuit Settlement
The college football landscape is currently in a state of flux with new variables like conference realignment, the expanded College Football Playoff, NIL, the transfer portal and a future revenue sharing model between college athletes and their schools coming down the pipeline.
In the midst of all of this, the Atlantic Coast Conference (ACC) and two of their member schools, Clemson and Florida State (FSU) have been embroiled in ongoing litigation, that settled in early March after 14 months and millions of dollars in duelling lawsuits.
"Today's resolution begins the next chapter of this storied league and further solidifies the ACC as a premier conference. The league has competed at the highest level for more than 70 years and this new structure demonstrates the ACC embracing innovation and further incentivizing our membership based on competition and viewership results. The settlements, coupled with the ACC's continued partnership with ESPN, allow us to focus on our collective future -- including Clemson and Florida State -- united in an 18-member conference demonstrating the best in intercollegiate athletics." – ACC Commissioner Jim Phillips
What Happened?
Clemson and FSU filed respective lawsuits against the ACC, challenging a grant of rights agreement that could have meant these schools paying several hundred million dollars to leave the ACC – leading the ACC to countersue both schools in order to preserve this agreement through 2036.
Another argument was in respect to future tv rights deals if one of these schools was to leave the ACC. The ACC contended that they would belong to the conference through the 2036 ESPN contract, whilst Clemson and FSU argued it should belong to them.
Settlement Terms
The penalty to leave the ACC has now been significantly reduced, with a starting 2026 exit fee of $165 million that will decline $18 million annually and level out at $75 million until the agreement ends in 2036.
Television rights deals will also now accompany a school if they elect to leave the conference.
The ACC also announced a new brand initiative in which 60% of television revenue will become bonuses for the schools that draw the most viewership, subsequently rewarding their biggest brands – like Clemson and FSU.
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"At the end of the day, this innovative distribution model, which further incentivizes performance and investment, will help strengthen the ACC -- and a strong ACC is good for Clemson; and a strong Clemson is good for the ACC -- while providing future flexibility to adapt to changes we should anticipate within the collegiate model.” – Clemson Athletic Director Graham Neff
"We had to do something, and it had to be a positive outcome for Florida State. We're way better off than where we were 14 months ago, when we were being told we had no options. Now, we have options and we have a good fit. This is going to make the conference better. I think it's going to incentivize people in the conference to really invest." – Florida State Athletic Director Michael Alford
What’s Next
The settlement still has not been finalized, so you never know, but at this point it seems like a formality that should be done by early April.
Realignment still lurks though, and long term stability for the ACC seems unlikely in the long-term as the college football landscape continues to shift.
“You live to fight another day and at least get to the point where you’re going to see what it’s going to be like in 2030, right? Are you guaranteed life beyond that? Absolutely not. But nobody is.” – Fox Sports Executive Bob Thompson
MSc Candidate, Human Genetics
1moThis guy knows how to write sports drama