Pete Thamel shares numbers, details and dates on Florida State's lawsuit vs. the ACC

Alex Weberby:Alex Weber•12/30/23

If you want to know every last detail on Florida State’s quest to leave the ACC, then park yourself in a seat and get out those reading glasses, because this article has it all.

On Saturday morning’s Bowl Season edition of College GameDay, prominent college football insider Pete Thamel joined to explain the Florida State/ACC situation and upcoming battle in court. Below you can read about the following:

  • The actual court proceedings and process
  • The $ numbers on FSU’s exit fee and the projected value of the grant of rights
  • The $ figure FSU is losing as an ACC member compared to SEC/B10
  • Why FSU is a massive “chess piece” for Big Ten, SEC
  • Whether other ACC schools follow suit, literally

Dive in…

Initial court proceedings

Florida State wants out of the ACC and has officially began the process of suing the conference to avoid its exit fee and wiggle free of the grant of rights, which currently controls the Seminoles’ media rights through the next 12 seasons.

“For Florida State to leave the ACC, what they really need to do is shed themselves of any legal entanglements,” Thamel said to begin his FSU/ACC breakdown. “So they obviously have filed in local circuit court, in Leon County in Tallahassee, they’re essentially suing the ACC.”

However, the ACC filed in North Carolina, where they’re hoping to get a judge and jury from ACC country rather than one full of FSU supporters.

“What the ACC did preemptively before Florida State announced they were going to challenge the grant of rights, is they challenged Florida State in Mecklenburg County in North Carolina. So what they’re basically doing is angling for a home game, like most people in college football.”

Thamel then detailed why Florida State has to challenge to get out of the ACC before they can begin negotiation with the SEC or Big Ten.

“They don’t have a destination yet where to go, but the thought process is: they need to start the process to leave, become clear of any tortious interference — which means the Big Ten or the SEC can’t come and get them if they’re still tied to the ACC. They don’t want to look like they were interfering with the contract.”

Now, let’s get into the actual money that’s at stake in this potential court case.

$572 million on the line

“What those courts decide is the $572 million question,” said Thamel, before GameDay co-host Pat McAfee stepped in to ask what exactly comprised that 572 figure.

“The exit fee is $130 million. They have 12 years left (in their ACC contract) and the estimated media value for that 12 years creates the delta to get to the number,” explained Thamel. “That’s what Florida State has estimated in court documents that they’re going to file that it would cost them to leave.”

The real financial hit

Should Florida State lose the suit and are forced to pay the exit fee and suffer the media rights losses, Thamel believes Florida State could ask for some help. That could happen if they settled, too, and paid the ACC and unnamed figure in between the $130 million exit fee and that full $572 million number.

“We’ve reported that they’ve engaged private equity,” which would be in the form of a massive loan to pay for the buyout. “First, they would have to pay some significant amount of money, yes, and then they’d have to pay the private equity company back” — and certainly with interest.

Plus, once they did get out of the ACC and into a new conference, there’s no guarantees the major SEC or Big Ten money would come right away.

“But wherever they go, one thing that’s fairly certain right now with the media market the way it is: they’re not going to get full freight,” claims Thamel.

“Much like Washington, Oregon, Cal, Stanford, SMU all went to their new leagues at discounted rates, Florida State will not enter a league at full throttle. So they’re basically going to have to pay to leave, and then they’re going to have to take much less money moving forward.”

Could be a tough few years for accountants at FSU to swallow. But Thamel also made the point that money is why Florida State wants to leave in the first place. Because once they are situated in, say, the SEC, they can make immensely more cash per year than they were in the ACC.

“Financially, they have found it untenable to move forward. If Florida’s making $60-70 million, they can’t be making 30-40. That’s ultimately the math,” says Thamel, adding that this move is in the when not if category.

“They are going to leave the ACC at some point. It’s their intent, their president has said it, their athletic director has said it. It was inevitable.”

The Aug. 15 deadline

If Florida State wants out, no matter the result of the lawsuit, then they’ll have to wait until the 2025-26 school seasons, since the deadline to leave for 2024-25 already passed. But the deadline for ’25-’26 comes up on Aug. 15.

“It will not be next year, we know that. By August 15th of this year, they’d have to declare to leave for ’25-’26. They have a six-month legal runway to see how this all looks, to see if the ACC will negotiate some exit settlement with them,” says Thamel.

But the situation gets awkward if the legal battle isn’t settled by then.

“Then, August 15th becomes a crucial date in this, because if they declare they’re going to leave, then they could potentially exit before then, but it would be foolish to exit — they said they don’t want to be independent without somewhere to go.

“Well, there’s only two places to go, the SEC and Big Ten. The SEC doesn’t have a tremendous appetite for them as of right now, but if the Big Ten does have an appetite for them, it becomes a bit of a game of chicken, right. Does the SEC want the Big Ten planting a flag in the south? We’re going to these mega conferences and Florida State becomes this crucial chess piece.”

In addition to the massive financial implications of the case, Florida State also has to balance that timeline of needing to have a decision to leave ready before Aug. 15 when $572 million is still hanging in the balance.

Will Clemson, North Carolina be next?

As for the other desirable programs in the ACC, Pete Thamel believes they could be taking the wait and see approach. Particularly, North Carolina and Clemson have their eye on this case.

“So Clemson has not been as outspoken, but has done just as much due diligence. They would be expected to make a similar move next, perhaps in the upcoming months.

“North Carolina, I can’t overstate, is really the most coveted property in the ACC right now. North Carolina, with its brand and big cities — I believe it’s the 11th-most populated state in the country — and it goes SEC North but also Big Ten South. So it’s kind of a battleground state, to use an election term, that both leagues are going to look at.”

There you have it, folks: the full picture on Florida State’s attempt to leave the ACC and all of the trickle-down effects this court ruling could ultimately cause.

Plus, after that complete dissertation from Pete Thamel on the looming legal showdown between Florida State and the ACC, Pat McAfee gave the reporter his props.

“You look fantastic, I’m getting emotional watching you up here. You command the stage,” he joked. But after several straight minutes of detailed breakdown and legalese, it’s a deserved set of compliments.