Smoke your cigars and enjoy the band while you can....

[steve dave]

the GoR is the most over relied upon talking point in conference realignment. it's no different than a buyout other than it doesn't contain a concrete buyout figure. it also wouldn't be fully paid any more than any buyout figure has been in the history of conference realignment. It would make negotiating the ultimate lump sum figure a bigger pain in the ass when someone leaves though.

True.  In simple terms, all the GoR means is that the original conference's media partners would get to broadcast the game and not the new conference's media partners.....An advertiser's check for their ads on games at the offending school's campus go to the prior conference's media partner,  and not to the new conference's media partner, for the length of the contract.

I got a kick out of Kevin Keitzman's ridiculous overestimation of the impact of GoR as an obstacle to KU going to the Big 10.  He was really bent out of shape about it, laying into Kevin Harlan (who claimed that the Big 10 has spoken with Kansas) claiming it would be way too big of hit to the Big 10.  The Whataburger check for the ad at halftime for games in Lawrence would continue to be mailed to the Fox office and not to the Big 10 Network office for the length of the GoR.

In truth, all a GoR would do to KU, for example, would be to deprive their future conference of the revenue of playing games in Lawrence.   The real money is in football, and the opportunity cost of Lawrence football games in 16 team league (loads of crap matchups) is minimal, and arguably worth the investment to get Kansas' 10+ road conference basketball games a year (with conference tournament games).

Now, if you are football power, the media partners might get a bit more jumpy about giving up home game broadcast rights/revenue.

no, it means there would be a buyout paid to the conference at a figure negotiated by both sides

I was outlining the worst possible scenario for the new conference/school, which isn't too bad.  I read your point to be that it's likely easier for the new conference/school than the worst possible scenario....that the worst possible scenario wouldn't be realized.  However, if you are the old conference, what's there to negotiate about?  If I were the Big 12, and the Big 10 took KU, for example, why would the Big 12 even return the Big 10's phone call?  Just cash the mother rough ridin' checks from your media partner, right?  But, that's really beside the point, because the fight would be between media partners, and not between schools/conferences.

Regardless of litigation outcomes, it would seem that it's probably fairly pud to get out of Big 12, if you are KU.  If Kevin Harlan isn't lying on 810am when he says that the Big 10 is talking to KU, and/or Kevin Harlan isn't being lied TO, then KU could merely be waiting for the Big 10 to say the word.    Again, maybe Kevin Harlan is a big fat liar...probably more likely that Delany is playing games with KU, as a super-super-super-safety net option.

Either way, it seems we agree that BITB is full of crap, with regard to the GoR being any sort of obstacle to KU leaving.   

what's there to negotiate about if there is a flat $20 million buyout? yet nobody ever pays it. the value of the media rights to the new conference and the school leaving are much higher than the value of the media rights to the old conference and the old media partner who possibly doesn't broadcast that conferences games. the worst case scenario is the same as the best case. the conferences/school negotiate a buyout for the rights to broadcast the games and be paid for them and everyone goes on their way. everyone who says a GoR has more teeth than a traditional buyout is wrong. it has exactly as much teeth as long as you have a good idea what the ultimate negotiated figure would be.

[steve dave]

basically what I'm saying is everytime someone says something like "nope, they couldn't leave because of the GoR" I do this  which it appears you do as well Pete

["storm"nut]

am I correct in believing that all GOR does is put something on the table that conferences can hold over a school if they want to leave and create a stronger negotiating position for the conference.

[Pete]

We agree then, SD.


For the others in this thread, in the interest of driving this [redacted] right into the ground, I want to clarify the following about the difference between a buyout penalty fee and a GoR, IMO:  GoR is potentially more expensive right now, and gets cheaper and cheaper every year going forward.

Unlike a penalty fee, the GoR literally decides who gets to put the games on their television network and sell ads that run during that game, for the life of the GoR.  It's not like a fee where you can say "I'm not going to pay you."   


But, in the final years of the GoR, that rough rider isn't worth much at all, and a penalty fee might actually be more effective at that point.



If OU left right now, for example, the Big 12 media partners likely wouldn't accept less money than what they would get if they continued to broadcast OU home games and reap those advertising dollars for the remaining life of the GoR. There is a price at which all would settle, but the Big 12 media partner's worst case scenario is that they just keep broadcasting OU's games and earning that money until the GoR expires.  So, if thing is going to expire in 1 more year, it's not worth crap....very little opportunity cost for the new conference.


GoR is pretty effective right now, but decreases in power, it would seem, until it's nearly worthless in it's final years.

[steve dave]

Nobody will hold onto rights of a team that left their conference ever. A buyout of the same "value" would be much more effective (though even that would never be paid in full). It's defining what that value is that is problematic.

[CyberToothCat]

GoR is pretty effective right now, but decreases in power, it would seem, until it's nearly worthless in it's final years.

Well, then hopefully the Big 12 has plans to extend or renew the GoR in about 5 years because the thought of OU and UT sitting there at the end of the GoR with little or no cost to prevent them from looking around is beyond terrifying.

[Saulbadguy]

test

[Pete]

Nobody will hold onto rights of a team that left their conference ever. A buyout of the same "value" would be much more effective (though even that would never be paid in full). It's defining what that value is that is problematic.

Wouldn't that be the Media partners' call?  They own the rights, they bought them from the conference.

Fox would absolutely show a UT game or an OU game after those two left.  Why the eff wouldn't they?

Even if what was left of the Big 12 did have a "say," they'd be so rough ridin' desperate to squeeze every last ounce of revenue from a dying source that all pride would go out the window.  The Big East had shown us how that works.

[MadCat]

test

It either worked...or it didn't.

[Panjandrum]

As you guys said, a GOR can be a pain in the ass.

It's not ironclad, but it's annoying enough to act as a deterrent.

[steve dave]

Nobody will hold onto rights of a team that left their conference ever. A buyout of the same "value" would be much more effective (though even that would never be paid in full). It's defining what that value is that is problematic.

Wouldn't that be the Media partners' call?  They own the rights, they bought them from the conference.

Fox would absolutely show a UT game or an OU game after those two left.  Why the eff wouldn't they?

Even if what was left of the Big 12 did have a "say," they'd be so rough ridin' desperate to squeeze every last ounce of revenue from a dying source that all pride would go out the window.  The Big East had shown us how that works.

use your same argument to ask why a conference has let a team leave and pay 60% of what their contractual buyout figure is.

[Pete]

Nobody will hold onto rights of a team that left their conference ever. A buyout of the same "value" would be much more effective (though even that would never be paid in full). It's defining what that value is that is problematic.

Wouldn't that be the Media partners' call?  They own the rights, they bought them from the conference.

Fox would absolutely show a UT game or an OU game after those two left.  Why the eff wouldn't they?

Even if what was left of the Big 12 did have a "say," they'd be so rough ridin' desperate to squeeze every last ounce of revenue from a dying source that all pride would go out the window.  The Big East had shown us how that works.

use your same argument to ask why a conference has let a team leave and pay 60% of what their contractual buyout figure is.

No, because the media partners didn't have the decision rights on that one.

[steve dave]

Pete, read this: http://www.outkickthecoverage.com/myth-of-the-big-12s-grant-of-rights.php

[Pete]

From the comments section of that blog

Urgh! I wish more attorneys understood IP law. A GOR is a license whereby one party licenses (not pledges) their rights in their copyrights to another party for a term or for the life of the copyright. When you give someone an exclusive license, you promise that the licensee and only the licensee may exercise the right. This means that when you grant an exclusive license, even you may not exercise the granted right, nor may you authorize anyone else to do so. This is not a new idea. Examples of contracts which contain a GOR clause include recording contracts, publishing contracts, and software licensing contracts. GOR have been upheld in the past and are hard to get out of (see mellencamp v. riva music). If what you are suggesting would actually get someone out of a GOR clause, it would have been argued by now. I have not run across a case where it has been tried.

The main question here is not whether damages exist but whether the courts would allow a school to get back the IP that the conference has the exclusive right to exploit so they can re-license it to another conference. Your premise is wrong because you assume this is a pledging of rights (a promise) and not an exclusive license of rights (property interest/ control) in a copyright. While damages would come into play if a college left their conference, copyright issues control the GOR clause of the agreement. There is no question that the conference has an exclusive right to the media rights of the departing school. A conference would not be forced to sell it's license back to the college, they own it for the term of the agreement. If a conference refused to allow a school to buyback their rights then the school would have to prove that the conference breached a fiduciary duty or breached the contract. I think IP cases are the way to go if you want to crack the GOR clause.

[Pete]

Another comment from the same

With a GoR, the conference owns the TV rights of the school. If the school leaves, their TV money stays with the conference. Nothing to do with liquidated damages, because there won't be any damages except for the self-inflicted wound of the departing school.

[Pete]

Wow. This article is a big, ignorant pile of fail.

The one key, deeply flawed, WRONG presumption in this article is that the school can transfer their TV rights to the new conference. NOPE! WRONG!

This is not contract law. We are not dealing with a breach of contract and needing to figure out damages, and the intricacies of liquidated damages. This is pure, uncomplicated, PROPERTY RIGHTS. The schools sold their TV rights to the conference for 13 years, and in exchange for those rights they were paid with a better TV contract.

Those TV rights don't belong to them anymore. If you sell your house, you can't change your mind later, the house doesn't belong to you anymore, and those 13 years of TV rights do not belong to the schools anymore. There is not a country on this entire planet where property rights are more protected and more sacrosanct than this one.

This so-called "legal analysis", is hilariously flawed, and incorrect. Besides, why would the big 10 and the PAC 12 waste their time with a GOR? The Big 12 did not invent it.

What is more likely, that all of the legal pundits and all the sources from within other conferences who all commented that the GOR means the Big 12 is locked together, are correct?

Or that this dude, random blogger extraordinaire with a seemingly shaky grasp of the difference between contract law and property rights, is correct?

[Pete]

It seems to me, that the GoR and the "penalty fee" example have zero in common, except that they can both be negotiated.  However, in the GoR, the departing school and new conference have much less leverage initially.  This increases as the GoR decreases in years, until it's a pile of crap in the last year.

[steve dave]

they both have a $ value which is the only thing in common that matters at all

[Pete]

they both have a $ value which is the only thing in common that matters at all

Agreed that they have value, but the GoR is property law, not contract law.

If the old conference media partners own exclusive rights to broadcast the departing schools games, then arguably they can choose to either continue to broadcast the games and reap all the revenue from doing so, or sell them to the new guys.  It would seem that a court could not force the old conference media partner to sell them to the new conference media partner....would not rely on the rarely enforced "specific performance" remedy, because that's not even in play.

Maybe I am wrong, but I don't think I am.

The marketability of the team who departs would play a huge factor in whether the old media partner decided to continue to broadcast the games or to sell them.  If I'm FOX (for example), I'd gladly sell KU off to the new media partners, but I'd sure as hell broadcast OU or UT unless the new media partners completely made me whole with a big ass payment (factoring in investment and operating costs to arrive at the true net present value of the broadcast revenue).



In summary:

Right now, the GoR locks in UT and OU way more than everyone else in the conference.   KU is free as a bird, relative to OU and UT.

Later, say 1-3 years before expiration of the GoR, everyone is as free as a bird.

[KITNfury]

Speaking in absolutes about the GoR is stupid. It hasn't been challenged in court so anybody saying this or that would happen is full of crap.

[steve dave]

Speaking in absolutes about the GoR is stupid. It hasn't been challenged in court so anybody saying this or that would happen is full of crap.

It would never get to court anyway

[Panjandrum]

Pete, read this: http://www.outkickthecoverage.com/myth-of-the-big-12s-grant-of-rights.php

I can't believe you linked Outkick the Coverage, sd.

[KanSt43]

Just wanted to post in this topic because it has 972 pages, so it's obviously elite.

Cheers.

[steve dave]

Pete, read this: http://www.outkickthecoverage.com/myth-of-the-big-12s-grant-of-rights.php

I can't believe you linked Outkick the Coverage, sd.

there are over one million quotes from the dude in this thread, ANYTHING GOES

[Dr Rick Daris]

oh no. first sd engaged pete on conf armegeds and now he's aiming missiles in the direction of pan. i predict 1k pages before the weekend.