With Florida State, Clemson dropping lawsuits there is peace in the ACC – sort of. Here’s what to know
In 1938, with much of Europe besieged by the threat of widespread war, British Prime Minister Neville Chamberlain offered one of the most incorrect and short-sighted assessments in modern world history. In celebrating an agreement designed to appease Germany and reduce ever-increasing hostility, Chamberlain said the deal would bring “peace for our time.”
Instead, it only delayed the inevitable. Germany, it turned out, could not be appeased. World War II began less than a year after Chamberlain’s ill-fated speech, and “peace for our time” became a mock-worthy line; something like a meme decades before anyone knew what a meme was. You can almost see the text over any number of historical photographs depicting the carnage of the war:
“Peace for our time.”
Whether Jim Phillips, the ACC Commissioner, becomes a college sports version of Neville Chamberlain remains to be seen. And yet amid a long stretch of intra-conference hostility, with two members driven to lawsuits and the league fighting for stability — and, yes, peace — Phillips claimed victory on Tuesday, upon the official end of litigation that threatened the ACC’s future.
Florida State and Clemson, which sued the ACC over money and in pursuit of a way out of the league’s Grant of Rights agreement, agreed to drop their lawsuits Tuesday in exchange for a couple of long-sought concessions. For one, they’ll have a chance to earn a greater and disproportionate share of league revenue. And, two, the fee to leave the ACC will become a lot more affordable over the next six years. Phillips, for one, framed it as a win for his conference.
“Today’s resolution begins the next chapter of this storied league and further solidifies the ACC as a premier conference,” he said in a statement, referencing a “new structure” related to revenue distribution that he said “demonstrates the ACC embracing innovation.”
The new model, he said, would further incentivize “our membership based on competition and viewership results. The settlements, coupled with the ACC’s continued partnership with ESPN, allow us to focus on our collective future — including Clemson and Florida State — united in an 18-member conference demonstrating the best in intercollegiate athletics.”
Undoubtedly, Phillips and others who’ve been fighting to preserve the ACC’s future will spin these developments as a victory. Just days ago, the conference was being sued by two of its most prominent members. The ACC, in turn, was also suing both of those schools. Now the lawsuits are over. The campfire-singing and S’mores-passing can commence. The faint melody of Kumbaya is starting to resonate in the distance.
Indeed, the ACC will remain intact, and FSU and Clemson aren’t going anywhere. At least not for now.
And so there is peace for our time in the ACC. But for how long? And at what cost?
Those are but two of many questions about the ACC’s armistice. In Q-and-A form, here’s what to know:
Q. What’s the nitty-gritty of the settlement, and what are FSU and Clemson getting?
A. What’s changing is that the ACC is adopting what it described Tuesday as an “additional revenue distribution model that is based on viewership.” In other words: Ratings matter. The schools that generate the best ratings in football and men’s basketball (but especially in football) will receive a greater share of the league’s television revenue.
That’s a win for Clemson and FSU, whose football ratings usually remain strong regardless of their performance, and for other schools who deliver good ratings, like Miami. It’s not great news for ACC members with smaller followings. While FSU and Clemson stand to gain a larger share of the TV money pie, the portions at Wake Forest and Boston College (among others) will shrink.
In terms of raw numbers, the ACC during the 2022-23 fiscal year generated $706.6 million in revenue. Television revenue accounted for $481.7 million of that total. In the model league members approved on Tuesday, 40% of the ACC’s TV revenue will continue to be distributed equally, as it has been. The remaining 60%, according to a league source, will be distributed based on a formula that rewards the schools with the highest television ratings.
Schools with the strongest brand power will stand to make a lot more money. Schools with the weakest brand power will not be as fortunate. Such is the world of college athletics in 2025.
Q. What else is there to know about the settlement?
A. In addition to the new revenue distribution model that’s all about ratings, the ACC’s exit fee structure is also changing. It will become cheaper for schools to buy their way out of the conference. The current exit fee, determined by the size of the league’s annual budget, was a point of contention in FSU’s litigation against the ACC.
During a Clemson Board of Trustees meeting on Tuesday, school lawyers detailed the changes. The fee to leave the conference is $165 million this fiscal year. The cost decreases by $18 million annually until it’s $75 million during the 2030-31 fiscal year. If a member wants to pay $75 million to leave in six years, it would also retain its media rights.
Q. Back to the ratings for a minute. Aren’t ratings determined by a lot of factors beyond any school’s control — like opponent or the time of a game or the network, and those kinds of things?
A. They are, indeed.
Q. And isn’t that somewhat unfair, in that ratings might not have anything to do with how good a team actually is?
A. Yes, but such is the media world in 2025. The latest Mr. Beast video has almost 50 million views on YouTube. He’s going to make more money off that than, you know — some other video, with far fewer views, that might be of greater artistic and cultural merit.
Q. The league already announced performance-based initiatives that allowed for unequal revenue distribution. If a school maxed out those, and also earned the most valuable share of TV money, how much more money would it receive?
A. The numbers get a bit complicated but according to a league source, schools who perform the best on the field or court and who also generate the highest ratings could stand to make an additional $30 to $40 million annually, with that figure increasing as the value of the ACC’s television deal goes up in the coming years. Again, that’s a rough number.
Q. So who really won here?
A. You mean aside from the lawyers? They’re the big winners in all of this. Florida State and the ACC sued each other in late 2023. Clemson and the ACC sued each other almost exactly a year ago, in March 2024. Enough time has gone by for a lot of billable hours to accumulate. The legal bills, on all sides, have run into the millions.
If the invoices haven’t been enough to fund beach houses, they’ve at least been enough for some new cars and an extended European vacation or two. So congratulations are in order to the attorneys, on all sides. They engaged in an exhaustive back-and-forth in cases that ultimately went nowhere, only for Clemson, FSU and the ACC to settle and reach an agreement they could’ve reached from the beginning, over a long lunch and an outline on the back of a couple of napkins.
Whenever schools and leagues complain about not having enough money in college sports, point them to these cases. They cost millions upon millions and ultimately could’ve been avoided.
Q. OK, so aside from the lawyers, who really won here?
A. It depends on your perspective. Florida State and Clemson can (and undoubtedly will) claim victory. The ACC will take a victory lap. Other ACC members that didn’t sue, but who were also upset about money and eyeing the Big Ten or SEC can also claim victory, in that they avoided the dirty work but will reap the same benefits that apply to FSU and Clemson.
North Carolina and Miami fit into that category.
Settlements only happen when there’s enough to benefit all parties and, clearly, that’s the case here. FSU and Clemson stand to earn a greater share of the ACC’s television revenue, because of their brand power. That’s a win for them. If they want to leave the conference in five years, around the next wave of television contracts in the Big Ten and SEC, it will now cost less to do so.
The ACC, meanwhile, gains some measure of stability. Now that two league members are no longer attempting to sue their way out of it, Phillips can sell the image of one big, happy ACC family.
Q. But is it one big, happy ACC family?
A. Phillips and officials from Florida State and Clemson did their best to make it sound that way on Tuesday, in glowing statements. Clemson University President Jim Clements praised the league’s new revenue-sharing model as “innovative,” and said, “We remain proud members of the ACC.” FSU President Richard McCullough, meanwhile, said he was “very pleased” with the settlement.
“From the start, we’ve held firm to the belief that the best solution would be one that enables FSU and every ACC institution to earn enhanced revenue through performance,” he said.
But let’s be real here: the same underlying factors that led to these lawsuits haven’t changed, and may well be impossible to change. The Big Ten and SEC make more money than the ACC, on account of the football “brands” and rating draws in those conferences. The financial gap between those leagues and the ACC will continue to widen.
There’s not much the ACC can do about that. Rearranging the distribution model so that the league’s most valuable brands are rewarded is an attempt to make the likes of FSU and Clemson and Miami more financially competitive with their SEC and Big Ten peers. But it’s probably a temporary solution.
FSU and Clemson are saying happy and nice things now, but check back in five years.
Q. Why five years?
A. Because that’s the timeframe that coincides with the next round of TV deals in those leagues. Either the Big Ten or SEC, or both, stands to cross the billion-dollar threshold in television revenue. And if it costs only $75 million for a school to leave the ACC and join one of those leagues, then it stands to reason that FSU and Clemson and others could just be biding their time.
Q. And wait, almost forgot: What about the league’s Grant of Rights?
A. It’s still a thing! And exists. But it appears far less punitive than it did yesterday. If a school wants to pay $75 million in 2031 to leave the league, it keeps its own media rights.
Q. The ACC’s deal with ESPN still goes through 2036. What are the odds the league remains intact through the duration of that deal?
A. They seem low but the only honest answer is: Who knows?
It’s impossible to gauge where college athletics will be a decade from now. How will the impending House Settlement and revenue sharing change the landscape, for one? Would the Big Ten and SEC, both of which are already imposing their will on the ACC and Big 12, go in on some kind of merger? Does a football-driven, NFL-like superconference become a reality?
And what of TV and the value of media rights? Do the traditional players remain as important, or does Apple or Amazon or Netflix or some platform that hasn’t even been invented yet reshape everything yet again? Impossible to know, on all fronts. Impossible to answer.
Think back to 10 years ago. Could anyone have predicted NIL, and the transfer portal? What about the Big Ten raiding the Pac-12, and adding UCLA and USC and Washington and Oregon? What about Cal and Stanford (not to mention SMU) in the ACC?
College athletics history has taught us two things: One, the craven and relentless pursuit of TV money rules all. And, two, the only constant is change. So can the ACC stick together for another 11 years? Sure. Anything is possible. Will it? Probably not, if history is any indication.
But, for now: There’s peace for our time. Just don’t get too used to it.
