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Clemson University sues the ACC over its grant of media rights, exit fees
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- Clemson University sues the ACC over its grant of media rights, exit fees
CLEMSON — Clemson University filed a lawsuit Tuesday against the Atlantic Coast Conference in Pickens County over its grant of media rights deal in an initial legal step in the Tigers potentially leaving the conference.
According to Pickens County court records, the lawsuit takes aim at the claim by the ACC that it "irrevocably owns the media rights of member institutions to home games played through 2036, even if an institution ceases to being a member" and "paying an exorbitant $140 million penalty to leave the Conference, where members owe the Conference fiduciary duties."
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"Each of these erroneous assertions separately hinders Clemson's ability to meaningfully explore its options regarding Conference membership, to negotiate alternative revenue-sharing proposals among ACC members, and to obtain full value for its future media rights," the complaint states.
"As detailed below, collegiate athletics is at a crossroads. Without clarity as to its legal rights and obligations, Clemson cannot protect and advance its interests, or the interests of its student-athletes, in current and ongoing negotiations within the Conference, with the Conference's existing media partner ESPN, and in collegiate athletics more generally."
Clemson athletics released the following statement: "The ACC's position regarding the grant of rights, the exit penalty and obligations owed by members to the conference, as detailed in its public statements and other court filings, leaves Clemson with no choice but to move forward with this lawsuit.
"Clemson has not given notice that it is exiting the ACC and remains a member of the conference."
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The chair of the ACC board of directors, Jim Ryan, and ACC commissioner Jim Phillips released a joint statement afterwards: "The ACC remains confident that its agreements with all its members will be affirmed by the courts. Clemson, along with all ACC members, voluntarily signed and re-signed the 2013 and 2016 Grant of Right, which is binding through 2036.
"The Conference's legal counsel will vigorously enforce the agreement and bylaws in the best interests of the ACC's current and incoming members."
Clemson alleges the ACC is impacting "Clemson's ability to explore and pursue an exit from the ACC, or to negotiate alternative revenue-sharing proposals among ACC members." It argues that schools aren't tied to ACC's grant-of-rights agreement with ESPN if an institution leaves the conference. As a result, if Clemson leaves the conference, it wants to keep its broadcasting rights.
"The media rights to games played while Clemson is a member of the ACC are the only rights necessary for the ACC to perform the Conference's obligations under the ACC's media agreements with ESPN," the complaint states. "The media rights to games played at a time when Clemson is not a member of the ACC were never a part of any grant of rights."
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Another complaint Clemson has is the revenue disparity between the "Power 2" conferences — SEC and Big Ten — and the ACC. The suit states the SEC and Big Ten's revenues will grow larger over the years to "an estimated average of $30 million per member institution per year."
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The suit also emphasizes how the ACC's $140 million withdrawal penalty is significantly higher than other conferences.
According to the complaint, the Big Ten has no withdrawal penalty, the Big 12's is "an amount of equal to revenues distributed to the departing member for the final two years of its membership in the conference" and the SEC's is "$30 million if two years' notice provided; $40 million if less than two years' notice is provided; and $45 million if no notice is provided."
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Clemson believes "the ACC's actions interfere with Clemson's free exercise of its rights and are fatally detrimental to Clemson's efforts to ensure that its athletic programs can continue to compete at the highest level."
Clemson is asking the court to rule:
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The ACC only owns Clemson's TV rights if Clemson is in the ACC
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The ACC's withdrawal penalty is "unconscionable and unenforceable," and Clemson is not required to pay it
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Clemson does not owe any fiduciary duties to the ACC, meaning the university does not have a legal obligation to act in the conference's best interest, and "has not breached any legal duty or obligation it might owe to the ACC by filing the lawsuit"
This is the second lawsuit that the ACC faces with Florida State suing the conference in December. Clemson's lawsuit seeks response from the ACC within 30 days, or it will claim judgment by default.
Derrian Carter covers Clemson athletics for The Greenville News and the USA TODAY Network. Email him at dcarter@gannett.com and follow him on X, formerly known as Twitter, @DerrianCarter00
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This article originally appeared on Greenville News: Clemson University sues the ACC over grant of media rights contract
