Seventy-year-old ACC is officially running out of time

Speaking on Capitol Hill last week in a roundtable discussion put together by Sen. Ted Cruz, retired Alabama coach Nick Saban said the “big mistake that people make is college athletics is not a business.”

Tuesday’s news of Clemson filing a lawsuit against the ACC pushes back against that narrative. With their 28-page complaint filed in Pickens County, South Carolina, court the Tigers have all but formally notified the conference it plans to seek a new home.

But Clemson is not alone in their quest to escape the ACC and its media rights deal. Florida State has been entrenched in a legal battle with the conference for months, and it could just be a matter of time until a third university joins the battle. North Carolina voted with Clemson and FSU against the additions of SMU, Cal and Stanford this past summer.

Clemson’s case is specifically centered around the ACC’s Grant of Rights, which binds the league, schools and broadcast partners together until the ESPN deal expires in 2036. Each ACC school is only making roughly $23.3 million annually. The latest Big Ten deal is expected to pay institutions between $70 to $100 million per year.

“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,” the lawsuit states.

Clemson hasn’t notified ACC of exit – yet

Tuesday’s court filing coincided with ESPN and the College Football Playoff finalizing its six-year agreement that will average $1.3 billion annually. That’s not a coincidence. With the new deal, the Big Ten and SEC control all the power in the sport. Institutions in those leagues will receive an annual payout of roughly $21 million.

ACC schools will make $13 million per year. With the latest CFP deal and the current college sports climate, the ACC is a second-rate citizen, as my colleague Andy Staples pointed out on Tuesday. Nobody is questioning Clemson and Florida State for looking around and seeking options to escape the ACC.

In a statement released Tuesday afternoon, Clemson emphasized it has not given notice to the ACC that it is exiting the conference. The complaint, however, makes it clear the Tigers are looking for any way to get out.

What happens to the ACC?

What comes of the ACC is the big question. If Florida State and Clemson ultimately win their legal battles, more institutions will file similar lawsuits to leave. ESPN also has the option next February to decline to opt-in into the final nine years of its TV contract with the ACC.

Some expect the Big Ten and SEC to compete over the pool of programs available in the next wave of conference realignment. But that would probably lessen the current TV payouts for schools. For years, many stakeholders have discussed a possible college football super league. Could the collapse of the ACC trigger the move?

Possible.

“Without a judicial declaration of its legal rights, which have been openly challenged by the ACC, Clemson is unable to pursue a wide range of strategic alternatives that may be necessary for its continued success in collegiate athletics and as an institution,” Clemson wrote in its complaint.

The possible split of the ACC comes when college sports is on the cusp of revenue sharing and possibly employment unless Congress moves to codify athletes are not employees. The crumbling of the ACC could be a domino toward the next college sports model.

Florida State and Clemson could push to settle. The buyout number probably sits somewhere between $150 million and a $572 ceiling. The Seminoles and Tigers would eventually make the money back through a larger TV payout down the road.

Plenty will be fought over in legal documents and the courtroom in the coming months. But Tuesday’s court filing was a sure sign that the 70-year-old ACC is officially on the clock.