Appeals Court Wades into FSU-ACC Fight

By Dara Kam, The News Service of Florida

TALLAHASSEE — A Florida appellate-court panel heard arguments Wednesday in a two-state legal battle between Florida State University and the Atlantic Coast Conference over issues such as sports media rights

Attorneys for the ACC went to the Tallahassee-based 1st District Court of Appeal in June seeking to put on hold a lawsuit filed by FSU in Leon County circuit court amid a dueling lawsuit that the conference filed in North Carolina.

The conference’s appeals-court petition, which came after Leon County Circuit Judge John Cooper refused to stay FSU’s lawsuit, cited a legal “principle of priority” and said the North Carolina and Florida cases both involve similar questions about sports media contracts and rights. Because the ACC is based in North Carolina, the conference argued its lawsuit should take priority.

Alan Lawson, a former Florida Supreme Court justice who represents the ACC, pointed Wednesday to “well-established” case law as he argued that Cooper erred in rejecting the conference’s request to put FSU’s case on hold while the North Carolina case plays out.

“Where two courts have concurrent jurisdiction of the cause of action, the first court to exercise jurisdiction has an exclusive right to hear all issues or questions arising in the case,” Lawson argued.

Judge Ross Bilbrey, however, said courts can consider “some exceptions” to the process.

Lawson said Cooper “departed from the essential requirements of the law” establishing “extraordinary” exceptions to the principle of priority. Having two lawsuits at the same time equates to “irreparable harm” for the conference, Lawson argued.

“It’s harassing, it’s oppressive, it’s vexatious, and that alone is irreparable harm,” Lawson said.

The legal battle stems from what is widely believed to be Florida State’s desire to leave the ACC to join a more-lucrative conference — and from potentially hefty amounts of money that the university would have to pay to exit the conference. At the appeals court, the conference filed what is known as a petition for writ of certiorari.

Attorneys for FSU contend that the conference, which filed the North Carolina case one day before Florida State filed its lawsuit in December, rushed to court without getting approval from member schools because it was anticipating the competing lawsuit filed by the FSU Board of Trustees.

A key issue in the case is a 2013 “grant of rights” agreement. The deal transferred the conference schools’ media rights to home games to the ACC, in exchange for a collective media-rights contract with ESPN. The grant-of-rights agreement, which Lawson said Wednesday was “irrevocable,” was modified in 2016 and lasts until 2036.

“FSU and each member promised that they would not take any action that would affect the validity and enforcement of the rights granted to the conference under this agreement,” Lawson said.

Lawson acknowledged that the timing of the ACC lawsuit was linked to Florida State trustees’ decision to challenge the agreement.

“FSU has breached its contract with the ACC and all member institutions, when it challenged the grant-of-rights agreement. That agreement, by its express terms, is irrevocable and they promised that they would not challenge it during the term of the contract,” he said.

Bilbrey asked Lawson whether Florida’s Sunshine Law, which required Florida State’s trustees to hold a public meeting and vote on the ACC issue, had “any impact on the principle of priority” about which lawsuit should take precedence.

“Anybody can get the jump on a Florida city, county, university, from an out-of-state perspective,” the judge said.

“If you had ‘procedural fencing’ … you could then use that to determine that it would not be appropriate to give priority to the out-of-state case. Again, that is not what happened here,” Lawson said.

Elliot Scherker, an attorney who represents the FSU trustees, said the panel needs to decide whether Cooper’s ruling constituted “such an egregious abuse” of the judge’s discretion that it warranted the appellate court’s revision.

“The ACC has not met and cannot possibly mean that burden and cannot be entitled to certiorari,” Scherker, a lawyer with the Greenberg Traurig law firm, said.

If Florida State leaves the ACC, it would have to pay a $130 million to $140 million withdrawal fee, attorneys for the conference said in April.

Florida State’s lawsuit alleges that the withdrawal payment is an unenforceable and “punitive” penalty to coerce schools into staying in the conference.

Scherker said Wednesday that the financial hit would amount to a “taking” of Florida State’s property.

The ACC’s position is that “it can continue to own the rights to FSU’s home games after FSU leaves the ACC, that they can take quintessentially Florida property and use it until 2036,” Scherker said.

“No, you can’t do that. You can’t take our Florida property, much less in a North Carolina action,” Scherker said.

Florida State’s attorney accused the ACC of “trying to stop a plaintiff from going forward in a plaintiff’s chosen forum by bringing the action” in North Carolina.

But Lawson disputed that the lawsuit is a “takings case,” arguing that it is a commercial dispute that belongs where the conference is based and where its members frequently visit.

“There is nothing extraordinary and nothing nefarious about the timing of the ACC’s lawsuit or the forum that it chose,” Lawson argued. “You’d have to be wearing garnet and gold-colored lenses to come up with Tallahassee as the answer for the most natural place for that contract dispute.”

FSU sought dismissal of the North Carolina lawsuit, but Louis Bledsoe, chief business court judge in Mecklenburg County, rejected the request in April. Florida State appealed Bledsoe’s decision, and the case is pending at the North Carolina Supreme Court.

In the ACC petition at the 1st District Court of Appeal, the conference’s attorneys wrote that “the North Carolina court found that there was nothing improper with a North Carolina organization filing a suit over a North Carolina contract when it was virtually certain that its counter-party (FSU) intended to breach that contract.”

Judge Joseph Lewis on Wednesday asked Scherker and Lawson what would happen if the cases continue in both states.

“If both suits are allowed to proceed and both result in different outcomes, what happens then?” Lewis asked.

The result would be “quintessentially an exercise of judicial discretion by a circuit judge,” Scherker said.

Lawson said there would be further delays.

“What happens if there are inconsistent rulings? Then there’s additional litigation in which we find out which judgment isn’t worth the paper that it’s written on,” he said.