Very good article on ACC next move and the key to the future

[orangepassion]

http://www.cbssports.com/collegefootball/blog/jeremy-fowler/21072228/whats-next-for-the-acc-

The key to ACC future may not be who they add, but whether they can enforce getting the $50 million exit fee.

 

[OrangePA]

I'm not an anti-trust lawyer, but I do not see the ACC losing this argument.

Given the amount of money flowing through college football and college basketball, I do not see the $50 million fee as reasonable - and a reasonable restraint on trade is permitted under the Sherman Act.

That Maryland made the move for $ millions makes it clear that the $50 million fee is not unreasonable. Otherwise MD wouldn't have made the move. Clearly the fee did not inhibit the trade or unreasonably restrain the trade.

So, I don't see MD getting around it.

 

[SmilinBob]

Unless the ACC knew Maryland wanted to leave, set the 50 fee and then of course the Terps voted no. If that is the order, I don't see the ACC getting the whole 50.

 

[Alsacs]

The ACC is going to lose this case unless they can show the loss of 1 school isn't punitive enough to warrant a 50 million dollar fee. That is why the ACC must wait and not pick a school so quickly as the damage of losing Maryland and replacing them with Louisville is not worth 50 million in damages and is purely punitive. The only ACC schools worth 50 million dollars to the conference are North Carolina and Florida State. This why the ACC needs to SECURE FSU's commitment before adding a 14th team and make sure they won't bolt to the Big XII before suing Maryland for the 50 million dollars.

 

[SmilinBob]

The domino theory.

 

[Orangello]

All UMD had to do was provide notice to the ACC of their departure from the conference before the vote to raise the exit fee was taken. They didn't do that. They also didn't seek to amend the bylaws in advance of that vote to require a unanimous vote on any exit fee increase. They'll probably argue that the $50M fee is against public policy and therefore unenforceable because it represents a "tax" on every citizen of the state which only the state legislature can levy, not the Board of Trustees of a university.

I think they're screwed.

 

[Crusty]

I'm not an anti-trust lawyer, but I do not see the ACC losing this argument.

Given the amount of money flowing through college football and college basketball, I do not see the $50 million fee as reasonable - and a reasonable restraint on trade is permitted under the Sherman Act.

That Maryland made the move for $ millions makes it clear that the $50 million fee is not unreasonable. Otherwise MD wouldn't have made the move. Clearly the fee did not inhibit the trade or unreasonably restrain the trade.

So, I don't see MD getting around it.

I am not a lawyer but I have probably been involved in more litigation than most lawyers. One thing I have learned is that a contract is nothing more and nothing less than the judge says it is. You notice than President Loh is a law professor and he mentioned "liquidated damages" because they can be difficult to enforce. (Notice how he bent over backwards to avoid using the word "fees" and used "sum" instead?) Judges don't like liquidated damages clauses because they take certain decisions out of the judge's hands - and judges, especially federal judges, have the same God complexes as surgeons. This is why these things tend to get negotiated away and Loh certainly knows these things and he is counting on them.

On the other hand the ACC will sue in Greensboro NC and hope for a friendly judge. They know that they need to win in order to end the musical chairs and I suppose that will make them very difficult to negotiate with - I certainly hope so.

In he end I would bet that one of the followingtwo things happen:

1. ACC loses, probably on appeal
2. Settlement for a hefty amount; less than the full $50 million but enough to be a credible deterrent.

Man, do I hate lawyers.

 

[PeteCalvin]

All UMD had to do was provide notice to the ACC of their departure from the conference before the vote to raise the exit fee was taken. They didn't do that. They also didn't seek to amend the bylaws in advance of that vote to require a unanimous vote on any exit fee increase. They'll probably argue that the $50M fee is against public policy and therefore unenforceable because it represents a "tax" on every citizen of the state which only the state legislature can levy, not the Board of Trustees of a university.

I think they're screwed.

I 100% agree. Mr. Under Armour better have that checkbook ready. There is more to this decision than just the $50 million MD owes. The ACC can argue that anything less than full enforcement of the contract will leave the door open for other schools to renege and leave, thus completely diminishing the value of the overall product. To prevent further pillaging by outside interests, the CONTRACT must be upheld. Just because MD voted 'No' doesn't mean they get special treatment or can skirt the contract. They knew going into the vote that they very well may end up on the losing side.

This is not a WVa to Big 12 case. WVa was able to get out because the value of the BE, and thus WVa's future interests, was in jeopardy. The ACC was healthy and was about to become more valuable with the addition of ND. Maryland has ZERO ground to stand on. Nothing, unless you count their financial incompetence as an organization. "Sorry, Your Honor, but we blame the ACC for making us spend more than we had to keep our athletics afloat."

I'm no lawyer, but that'll work, I'm sure.

 

[PeteCalvin]

I am not a lawyer but I have probably been involved in more litigation than most lawyers. One thing I have learned is that a contract is nothing more and nothing less than the judge says it is. You notice than President Loh is a law professor and he mentioned "liquidated damages" because they can be difficult to enforce. (Notice how he bent over backwards to avoid using the word "fees" and used "sum" instead?) Judges don't like liquidated damages clauses because they take certain decisions out of the judge's hands - and judges, especially federal judges, have the same God complexes as surgeons. This is why these things tend to get negotiated away and Loh certainly knows these things and he is counting on them.

On the other hand the ACC will sue in Greensboro NC and hope for a friendly judge. They know that they need to win in order to end the musical chairs and I suppose that will make them very difficult to negotiate with - I certainly hope so.

In he end I would bet that one of the followingtwo things happen:

1. ACC loses, probably on appeal
2. Settlement for a hefty amount; less than the full $50 million but enough to be a credible deterrent.

Man, do I hate lawyers.

Yeah. We hate them too. I wish the lawyers on this site would go make themselves useful and fight this thing in NC.

 

[OrangePA]

The ACC is going to lose this case unless they can show the loss of 1 school isn't punitive enough to warrant a 50 million dollar fee. That is why the ACC must wait and not pick a school so quickly as the damage of losing Maryland and replacing them with Louisville is not worth 50 million in damages and is purely punitive. The only ACC schools worth 50 million dollars to the conference are North Carolina and Florida State. This why the ACC needs to SECURE FSU's commitment before adding a 14th team and make sure they won't bolt to the Big XII before suing Maryland for the 50 million dollars.

So the fee has to be justified?

Is that conclusion Sherman Law? Case law?

Why doesn't the rule of reason apply?

 

[KaiserUEO]

The ACC is going to lose this case unless they can show the loss of 1 school isn't punitive enough to warrant a 50 million dollar fee. That is why the ACC must wait and not pick a school so quickly as the damage of losing Maryland and replacing them with Louisville is not worth 50 million in damages and is purely punitive. The only ACC schools worth 50 million dollars to the conference are North Carolina and Florida State. This why the ACC needs to SECURE FSU's commitment before adding a 14th team and make sure they won't bolt to the Big XII before suing Maryland for the 50 million dollars.

exactly.

its florida st.

they are the big dog. make sure they know, that you know, that they are the big dog...and then feed the big dog, keep it sedate.

this is unc's conf, they should do what they can to keep it in tact, and hopefully should be able to bully some schools (cough dook) into doing what they want.

they need 9 maybe 10 'lets keep fla st this way' votes . assuming fla st is 1 based on what they will now get in football...we have as yes locks:

unc
dook
fla st
Syracuse
pitt
bc
wake

id say with this, you would see miami (who may be an auto yes with their problems) clemson and ga tech fall in as well.

assuming the SEC rumors are true, vpi and nc st may still say no, but its moot. va can vote as they please, but they arent going anywhere so theyd likely be a yes.

so basically this is easy. give fla st what they want and nobody else goes anywhere.

kumbaya days are slightly over, you dont have to give the keys to the vault, just to an atm.

the ACC is saved.

 

[PeteCalvin]

So the fee has to be justified?

Is that conclusion Sherman Law? Case law?

Why doesn't the rule of reason apply?

Because the courts aren't about logic or reason. They are about law. Period. Specifically, interpretation of the law. So, if there is existing case law out there that a good lawyer can twist and mold into supporting an argument, it will win out over logic every time. I'm not saying it's right, but that's how it works. I sucks, actually. The court systems could use more logic. So could Congress.

 

[javadoc]

The ACC is going to lose this case unless they can show the loss of 1 school isn't punitive enough to warrant a 50 million dollar fee. That is why the ACC must wait and not pick a school so quickly as the damage of losing Maryland and replacing them with Louisville is not worth 50 million in damages and is purely punitive. The only ACC schools worth 50 million dollars to the conference are North Carolina and Florida State. This why the ACC needs to SECURE FSU's commitment before adding a 14th team and make sure they won't bolt to the Big XII before suing Maryland for the 50 million dollars.

It's not the loss of one team that causes $50 million in damages. It's the loss of all the teams that would bolt if the penalty was less. And by then, the stampede could well steamroll to more than $50 million in damages.

Of course the penalty is somewhat punitive. It's supposed to be a freaking deterrent to action, not an equitable financial accommodation.

 

[riskylogic]

They'll probably argue that the $50M fee is against public policy and therefore unenforceable because it represents a "tax" on every citizen of the state which only the state legislature can levy, not the Board of Trustees of a university.

As a counterargument, the state legislature has not authorized the university to tax the cable subscribers of the state.

 

[Alsacs]

This will be the ACC in 2014. IMO

ACC North
Boston College
Duke (University of New Jersey at Durham according to my UNC friends)
Pitt
Syracuse
Louisville
Virginia
Wake Forest

ACC South
Florida State
Clemson
Miami
Georgia Tech
NC State
North Carolina
Va Tech

Permanent crossover opponents will be
Louisville-Florida State
Virginia-Virginia Tech
Wake-NC State
Duke-North Carolina
Miami-Syracuse
Clemson-Boston College
Georgia Tech-Pitt

 

[OrangePA]

Because the courts aren't about logic or reason. They are about law. Period. Specifically, interpretation of the law. So, if there is existing case law out there that a good lawyer can twist and mold into supporting an argument, it will win out over logic every time. I'm not saying it's right, but that's how it works. I sucks, actually. The court systems could use more logic. So could Congress.

Well it seems that you have had some bad experiences.

Although I have been involved in a few cases where the result has been illogical, for the most part logic and the rule of law prevail.

I suspect that the ACC will prevail in this matter.