How 'ironclad' is ACC's grant of rights? Disgruntled Florida State is about to find out

Less than a month after the perceived snub of all snubs by the College Football Playoff left Tallahassee hissing mad, Florida State’s discontent with its own league has reached a fever pitch. 

With a Board of Trustees meeting abruptly scheduled for Friday and court filing likely to follow, the Seminoles are on the cusp of formally exploring a divorce from the ACC.

The Seminoles have made no secret over the past year that they are unhappy in their conference. In fact, they’ve been voicing their displeasure with a megaphone. Believing they are the biggest brand on the ACC block, they’ve watched the revenue gap between the ACC and two super conferences grow ever larger – with even a greater disparity in dollars on the horizon.

That FSU became the first-ever undefeated Power Five team excluded from the CFP – with perhaps the time-honored reputation of the superior SEC playing a role – only exacerbated angst.

The consternation has reached a tipping point, with FSU on the brink of what would be a historic challenge to what multiple sources told On3 appears to be an “ironclad” ACC grant-of-rights agreement.

That is the hurdle, albeit a monumental one, standing in the way of FSU ultimately bolting to … well, where exactly the Seminoles land remains another important, open question.  

Mit Winter, a college sports attorney with Kennyhertz Perry, expects Florida State to file a declaratory judgment action, seeking to clarify the enforceability of the grant of rights before breaching it. 

“I see this as a preemptive move to bring the ACC to the table,” Winter said.

A grant of rights agreement gives conferences the right to broadcast all member schools’ home games for the duration of the media rights deal. In the ACC’s case, the GOR binds the league, schools and broadcast partners until the rights deal with ESPN expires in 2036. 

Other ACC schools have examined the document and any wiggle room that may exist if they want to jump to another league. One longtime ACC official told On3 over the summer that the league’s GOR is “ironclad.” Another prominent source with deep ACC ties also stressed that the league believes the grant of rights agreement is virtually unbreakable. 

Could Florida State turn to private equity to assist?

Florida State is about to test just how “ironclad” it is. 

If the ACC and FSU were to ultimately reach a settlement, FSU’s ability to maneuver out of the GOR deal could come with a hefty sticker price – reportedly approaching $500 million. 

That is in addition to FSU being on the hook for an exit fee of some $120 million. 

Of note: Florida State has been working with JPMorgan Chase to explore how the athletic department could raise capital from institutional funds such as private equity, Sportico reported in early August. The private equity firm Sixth Street was reportedly in “advanced talks” to lead a possible investment. 

“I hadn’t anticipated sort of the idea of private equity getting involved in college sports,” ESPN analyst Jay Bilas told On3 at the start of the football season. “You know how much money private equity has right now – they’re looking for places to put it. So it makes some sense. I don’t know whether Florida State’s involvement is going to be on terms of just some gigantic loan or private equity takes a piece.”

If Florida State, as expected, moves ahead Friday with its legal filing, it would mark just the latest turn to the courts in a turbulent college athletics landscape defined more than ever by legal wrangling, lawsuits and ongoing proceedings with other entities – all of which figure to reshape the contours of the enterprise in the years to come. 

‘It’s not a matter of if we leave’ the ACC

While the CFP snub – FSU became the first-ever undefeated Power Five team excluded – was the latest black eye for the Seminoles, the school’s unhappiness with the league has been publicly simmering, if not boiling over, for at least a year.

At a much-publicized meeting in August, Board of Trustees member Drew Weatherford, the former FSU quarterback, said bluntly, “It’s not a matter of if we leave [the ACC], in my opinion. It’s a matter of who and when we leave.” And FSU President Richard McCullough at the same meeting said the school would “very seriously” explore leaving the conference absent significant changes to the ACC’s revenue distribution model.

In the meantime, Florida State has watched the nation’s two super conferences, the SEC and Big Ten, continue to add marquee brands and boatloads of broadcast revenue dollars.

In 2024, the SEC will add Texas and Oklahoma, while the Big Ten will add USC, UCLA, Oregon and Washington. On the revenue front, the Seminoles also know that schools in those leagues will virtually lap the field with schools from the ACC. FSU could fall behind those schools by some $30 million annually in revenue. 

This summer’s realignment madness only highlighted the fissure that exists within the ACC. While the league garnered barely enough membership support to green-light the geographically challenged additions of Stanford, Cal and SMU. Don’t forget that FSU voted against the moves, as did Clemson and North Carolina.

Where could Florida State go?

FSU believes it has a robust national brand that warrants a seat at the cool – and rich – kids’ table. One question: Who wants to add the Seminoles in the near future?

Neither the SEC nor the Big Ten has signaled further appetite to expand in the near future. But anyone connected to college sports worth their salt knows that few inevitabilities exist other than death, taxes and realignment.

More is coming – the only question is when.

One veteran media rights source called Florida State a significant national brand. A key question, as always, is whether its addition to a league would markedly grow the revenue pie enough to make the slices for each member large enough to justify the move.

Let’s not forget yet another variable – if there aren’t enough already – in the mix: NCAA President Charlie Baker wants to create a subdivision of like-minded, high-resourced schools to craft their own policies and create a trust fund with a $30,000 annual floor for each athlete. Whether the NCAA’s proposal ever sees the light of day, and in what form, remains an open question.

But it could be a relevant element in Florida State’s calculus as it looks far and wide for an attractive landing spot outside the ACC. 

In the long term, FSU needs to notify the ACC by Aug. 15 if it plans to play in another league in 2025. In the short term, the Seminoles look poised to turn to a court to ask the all-important question: Just how “ironclad” is the ACC’s grant of rights?

Disgruntled Florida State is about to find out.