Quote:
Originally Posted by alnorth
The Grant of Rights is a property transaction, just like selling a car. The schools which signed it, sold a real, valuable product and they got paid for it in the form of a better contract. Property Rights are more protected and sacrosanct in this country than anywhere else in the world. Unless you are the victim of fraud or something like that, once you sell your car and sign it over, you cant change your mind the day after, and the schools which sold their rights to the Big 12 cant change their mind. The only way to unwind it is if the guy chooses to sell you the car back or the conference chooses to give the schools their TV rights back. (edit: or if enough schools vote to dissolve the conference, which depending on who you talk to means either 6 or 8 votes to dissolve. Good luck with that)
The exit fee is supposed to compensate the conference, but at $50MM it is really a punitive penalty designed to punish. Maryland didn't even vote for the penalty, it was imposed on them and they received absolutely no benefit from that penalty. The problem is that the exit fee must, legally, be a good-faith attempt to compensate the conference. The exit fee is liquidated damages, which courts recognize, but it must be intended to compensate the conference, it can not be so ludicrously high that it was really intended as a punishment.
The ACC will have to argue in court that Maryland leaving damaged them so badly, that $50MM is a reasonable rough estimate of their loss. Maryland will point out that the TV contract was not impacted and they replaced them with Louisville.
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Thanks, Al. I frequent an ACC board, and I think the consensus on that board is that the exit fee will actually stick (teams continue to pay the Big East, for instance). It'll be interesting to watch in the coming weeks, months, years (or decades, I hope).