What is the ACC grant of rights, and why is Florida State suing to get out of it?

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What is the ACC grant of rights, and why is Florida State suing to get out of it?

Dan Rorabaugh, USA TODAY NETWORK - Florida · Tallahassee Democrat

Fri, Dec 22, 2023 ·

7 min read

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Florida State is filing a lawsuit in Florida court to leave the ACC . Why they're taking this step is a story that dates back long before the FSU football team was snubbed from the College Football Playoff .

The lawsuit was approved at Friday's special Board of Trustees meeting.

FSU's biggest contention with the conference is over its grant of rights , the media deal that all schools within a conference have to sign. The restrictive deal lasts until 2036, and the proceeds Florida State gets from it pales in comparison to its rivals in the Big Ten and SEC after their latest blockbuster TV deals.

"I believe this board has been left no choice but to challenge the legitimacy of the ACC grants of rights and its severe withdrawal penalties," FSU President Richard McCollough said at Friday's Board of Trustees meeting.

The ACC filed its own lawsuit against FSU in North Carolina, claiming that "Florida State explicitly agreed that it would not 'take any action, or permit any action to be taken by others subject to its control ... that would affect the validity and enforcement' of the Grant of Rights."

So just what is the ACC grant of rights? Here's what we know.

Why is FSU leaving the ACC?

Florida State, along with Clemson and other high-tier schools in the conference, has for years railed against the ACC and its revenue-sharing plan. Most of the anger is centered around the TV deal with ESPN, which expires in 2036.

The final straw, though, might have been the FSU football team being left out of the College Football Playoff . The Seminoles looked like one of the best teams in college football all season until quarterback Jordan Travis , who finished fifth in voting for the Heisman Trophy, broke his leg against North Alabama on Nov. 19.

With Tate Rodemaker under center the next week at Florida and third-string QB Brock Glenn in the ACC championship against Louisville, FSU put up 443 total yards and scored 40 combined points in the last two games before bowl season. But the defense, led by pass rushers Jared Verse and Patrick Payton , stepped up, holding opponents to 420 yards and 21 total points. The Seminoles finished 13-0 with a Power 5 conference championship, something that had guaranteed a spot in the playoffs the previous 10 years.

But despite being ranked No. 4 heading into the final weekend, the CFP committee decided the struggling offense wasn't good enough to make the four-team playoff. Undefeated Michigan and Washington would face one-loss Alabama and Texas, respectively, leaving Florida State to play two-time defending champion Georgia in the Orange Bowl on December 30 and making a lot of people (including Gov. Ron DeSantis , Sen. Rick Scott and, of course, Donald Trump ) incredibly , loudly upset .

What does the ACC grant of rights mean?

Schools in every conference must sign deals that transfer their media rights to the conference for the duration of the contract. The grant was originally signed in 2013 amid another period of conference realignment. With the original Big East breaking apart, the ACC had added Pittsburgh and Syracuse , the Big Ten was a year away from adding Rutgers and Maryland, and the rest of the teams were reforming into the American Athletic Conference.

"The ACC's original grant of rights, obtained and published in 2022 by The Athletic , ran through June 30, 2027," explains Brooks Holton of the Louisville Courier Journal . "It was amended in 2016 , when the conference extended its media rights deal with ESPN and Disney in conjunction with the launch of the ACC Network." The amendment extended the grant of rights to June 30, 2036.

In return for signing away their media rights, schools get a share of the conference's revenue. In May, the ACC Board of Directors announced a "success incentive initiative" that pays schools more if their teams win in the postseason. That is set to start next season.

How much is the ACC media rights deal payout?

The ACC is in a contract with ESPN that expires in 2036. The deal splits TV revenue evenly between all 14 schools (that's soon to be 17 with Stanford, California and SMU set to join in 2024).

Front Office Sports reported the deal pays about $30 million per school. The three new teams are expected to add $60 million to that pot, according to Front Office Sports. Florida State athletic director Michael Alford said in August the school receives $42 million annually from the conference.

Why is the ACC struggling?

Because that amount is paltry compared to what the Big Ten and SEC are getting from their new TV deals.

The Big Ten signed a seven-year, $8 billion deal to air games between Fox, CBS and NBC that went into effect this season. Next year, the SEC starts a 10-year, $3 billion deal to move from CBS to ESPN .

Those deals include huge payouts for the schools. Florida coach Billy Napier said projections show each SEC school would get millions more from the new deal, rising from $55 million to potentially more than $70 million . Florida State athletic director Michael Alford said Big Ten schools will receive about $80 million each year from its TV contract.

Alford said the gap between FSU and its rivals in the SEC and Big Ten will continue to grow as conferences exercise their flexibility around media rights. In three years, for example, FSU could trail rival Florida by an additional $90 million in revenues.

How much would it cost to leave the ACC?

By signing the grant of rights, schools agreed to transfer their media rights through the end of the contract, regardless of whether they are still in the ACC.

"That means FSU or any other school looking to jump ship would not receive annual revenue distributions from the ACC or their new conference for more than a decade," explained Holton .

A graphic shown by the FSU Board of Trustees on Friday said it would cost $572 million to break the grant of rights.

Can the ACC grant of rights be broken?

That's what Florida State and its lawyers are working to find out . David C. Ashburn, managing shareholder of the Tallahassee Office of Greenberg Taurig LLP and representing FSU, laid out the counts FSU is seeking to challenge the grant of rights:

It violates Florida law.
Unenforceable penalty on the grant of rights penalty. Ashburn said the court can invalidate the fee or set a new, smaller fee for an exit.
Breach of contract. "So first and foremost, the ACC has failed to appropriately give FSU the value of its athletic program media rights back being diluted those agreements those rights going forward," Ashburn said.
Breach of fiduciary duty. "It tracks in many respects the contractual obligations and the ACC does have fiduciary duties to its members."
Fundamental failure of contractual purpose.
Unconscionability and violation of public policy.

Which college football conference makes the most money?

The Big Ten brought in $845.6 million in revenue and paid about $58.8 million to nearly all of its 14 member schools in fiscal year 2022, according to USA TODAY . That number is set to skyrocket with the conference's new TV deal that went into affect this year with about $1.14 billion annually coming in from CBS, ESPN and Fox through 2030.

The SEC reported it made $802 million with $49.9 million per school in FY2022. That, too, is likely to jump starting next year, when its 10-year ESPN deal worth $300 million annually kicks in.

What teams are in the ACC?

For now, the ACC has 14 full-time teams:

Florida State
Miami
Clemson
North Carolina
North Carolina State
Duke
Wake Forest
Georgia Tech
Virginia
Virginia Tech
Louisville
Pittsburgh
Syracuse
Boston College

Notre Dame is also a member of the ACC in all sports except football. And three more teams are set to join the conference in time for the 2024 college football season:

Stanford
California
SMU

Read FSU lawsuit against ACC

Tallahassee Democrat sports editor Jim Henry and Florida State sports reporter Ehsan Kassim, and Brooks Holton of the Louisville Courier Journal contributed to this report.

This article originally appeared on Treasure Coast Newspapers: FSU leaving ACC over grant of rights: What to know about TV deal

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