Big East, C7, AAC, NBE Split/Restructuring Re-Visited (Yada, yada, yada...)

[Hoophound]

Which I believe was in the area of $100m all said and done.

Correct. They got the name and $10,000,000, leaving behind $100,000,000.

 

[Billy Jack]

“The Catholic 7 are leaving the Big East as they announced earlier in the basketball season, and it seems that the league they are joining will be the Big East. At least according to a report from ESPN's Brett McMurphy, Andy Katz and Dana O'Neill, the Catholic 7 (Villanova, St. John's, Georgetown, Marquette, Providence, Seton Hall and DePaul) will purchase the Big East name from the FBS football schools for an undisclosed sum of money (reportedly agreeing to "take considerably less money from a reserve pool," of exit fees and NCAA Tournament shares that was held by the conference).” SBNation

“The sale of the Big East name is not an exchange of cash. Instead, the so-called Catholic 7 will pay primarily by leaving behind much, if not all, of the money they would have received from the exit fees of other departing universities and the entry fees from new members, according to two people who have been briefed on the negotiations. The Catholic universities will not pay departure fees.” The NYT

In other words, they didn’t pay anything.

This article is exactly right except that it was written before the negotiations actually took place. So, they don’t really know what actually happened during the negotiations.

The facts are that this was a split, not an exit. A divorce. As in all divorces, the assets were divided between the 2 parties. The way that the assets were divided actually made a lot of sense. At that point in the conference’s history, the lion’s share of the NCAA units had been earned by the football schools and the exit and entry fees were completely a football issue. So the lion’s share of the money went to the football schools. They also got the football bid, which obviously had no value to the basketball schools.

On the other hand, the Big East name was a creation of the conference’s founders and UConn was the only one of those on the football side. The MSG tournament was a basketball asset, so it too made sense to go to the basketball schools.

The name and the tournament had tremendous value to the C7. I expect that Fox was active behind the scenes as the networks always are. Fix was offering $400 million for “Big East” basketball. That brand mattered, and I’m guessing that it mattered a lot. I’m sure that the C7 happily gave up the money to qualify for the Fox TV contract. The MSG contract similarly had tremendous marketing value - both to Fox as a way of selling the tournament and to the league as a way of gaining instant legitimacy and as a way of selling themselves to recruits.

In the real world, this was a negotiated settlement, plain and simpler. The C7 lost $45 million from the reserve fund that they might otherwise have gotten, but they also left on their time table without paying exit fees, which were required by the bylaws if they left with less than 27 months notice - which they did. The C7 did not buy the name; they got the assets they wanted, which included the name, and the football schools got the money which they wanted.

The most important thing which the C7 got from this divorce was stability and control of their future for their members, something which you can’t put a price tag on. Today they are one of the most stable conferences in a world of instability and a top tier basketball conference. How’s the AAC doing these days?

 

[Billy Jack]

Which I believe was in the area of $100m all said and

Because the world revolves around legal technicalities.

Food for thought, the Big XII was not a continuation of the Big 8. That is despite the fact that it contained all 8 original schools. The fact is the 8 schools left the Big 8 and began a new conference. As did the Catholic 7. The main difference is that the Big 8 ceased to exist while the Big East didn’t. The Catholic 7 simply bought the name, but the American was and is the legal successor of the Big East. It even inherited the Big East’s BCS autobid for a single season before that was blown up.

Go to the wiki page for the Big East, and you’ll see a heading, “Original Big East (1979-2013)”. You’ll see that there because that is how the situation is viewed by the world at-large.

If Wake Forest, NC State, Duke, Virginia, Virginia Tech, Louisville, Georgia Tech all left and started a conference and bought the name ACC from the conference, it would be a new conference. Even with overlapping membership. And in future years, people could talk about remembering FSU dominating the old ACC and people would know exactly what was meant. If someone piped in and said “but FSU wasn’t in the old ACC“, they could both be accurate (FSU didn’t join for decades) and misleading (clearly FSU was in the old entity known as the ACC).

So while you are accurate that West Virginia was not a founding member of the Big East and therefore was not in the old BE circa 1980, West Virginia was clearly a member of the old conference once known as the Big East. Georgetown could say they were in both iterations of the Big East, but that doesn’t make the New Big East the same thing as the Old Big East.

Your analogy to the Big 8 breaks down because the Big XII was never a successor conference to the Big 8. No way in the world were Texas, Texas A&M, and the rest ever going to apply for admission to the Big 8, pay entrance fees, and adopt the rules of the Bug 8. The Big XII was an entirely new entity in which teams from 2 different former conferences came together to form the new league. That was never the case with the Big East.

 

[Billy Jack]

Correct. They got the name and $10,000,000, leaving behind $100,000,000.

Yes, but the $100 million was going to be divided up in some way, so it’s not like they were ever going to get $100 mill.

The separation agreement also waived the separation fees that they were required to pay for exercising their option without 27 months notice. So, if we’re talking about money that went back and forth, that money has to be factored in as well because it’s money that the football schools didn’t get. Those fees for the C7 amounted to $35 million.

So, it’s not that the football schools got to keep $100 million and the basketball schools got nothing. The basketball schools got $10 million + the $35 million saved in fees = $45 million AND they got the Bug East name and the MSG tournament.

 

[JeepCSC]

Your analogy to the Big 8 breaks down because the Big XII was never a successor conference to the Big 8. No way in the world were Texas, Texas A&M, and the rest ever going to apply for admission to the Big 8, pay entrance fees, and adopt the rules of the Bug 8. The Big XII was an entirely new entity in which teams from 2 different former conferences came together to form the new league. That was never the case with the Big East.

Like the Big XII was not a successor to the Big 8, the new Big East was not a successor conference to the old Big East. Villanova and company voted to leave the Big East and followed the Big East bylaws when exiting the league. The BE commissioner stayed in the BE offices in Providence. Those leaving created a new conference with new bylaws and new officers in a new headquarters. They subsequently bought the name of the Big East. And thus was born “old Big East” and “new Big East”, different entities demarcated by the corresponding adjectives. Like Texas and the Big 8, Butler has no relation to the old Big East.

 

[TheDrifter75]

It was a divorce, as stated, the union was dissolved. All parties started over. Some kept the old name. They used pieces, MSG, of the old union to gain legitimacy, also stated, in the new venture. I mean, why would you need legitimacy if you're the original that's been doing it for 20 plus years?

 

[ScottVib]

When you are 7 schools leaving 3 existing members (UConn, USF and Cincy) and forfeit 91% of the cash reserves of an entity... you're paying something

 

[Billy Jack]

When you are 7 schools leaving 3 existing members (UConn, USF and Cincy) and forfeit 91% of the cash reserves of an entity... you're paying something

You’re still stuck on the $100 mill as the only thing that mattered, ignoring the $35 mill in fees that they kept and ignoring the Big East name and the MSG tournament, both of which had tremendous value. It’s like a divorce in which one party gets cash but the other gets cash, an investment portfolio, the mansion on 10 acres, and the Rolls. And then the one with the cash thinks he got it all.

 

[JeepCSC]

I’m not even sure what investment portfolios and divorces have anything to do with what went on. The Catholic 7 voted to leave the Big East. A new conference was set up. That’s the gist of old BE and new BE, and it’s understood by everyone.

The Big XII raided the old Big East for West Virginia. It is known.

 

[businesslawyer]

How much did the C7 pay for the name that they “bought”.

Just to understand what you’re saying, you’r contending that the Big East name belonged to schools like Cincinnati and South Florida but not to schools lie the C7, five of whom were founding members and along with us, BC, and SU, paid for the creation of the name in the first place. And the iteration with exists today, whose core is 6 of the 8 founding members is some new entity which bought its name and is not a continuation of the “old iteration”?

And the “original Big East” was an entity that didn’t even exist until 1995? What was the entity which called itself The Big East for 16 years before “the original Big East” came into existence?

I’m really trying to follow the logic here. We have 6 members who have been playing under the Big East banner continuously for for 43 years with the exception of our relatively brief hiatus (2013-20), but thus group is the “new Big East? And somehow a group of school which came and went over the years, sometimes as associate or football-only members are actually the “original Big East”?

I think I’ve got it now.

You can be as confused as you want, but facts are facts and the facts here are easy and clear. There was a Big East conference that was a non-profit corporation. When the Catholic five left it after the defection of too many football schools, the new corporation that the Catholic schools founded in 2013 or so bought the Big East name from the Big East conference, which changed its name to the American.

A corporation doesn’t lose it’s identity when a majority of founding shareholders leave. It has its own existence. The American is in fact the corporation that was founded as the Big East Conference in the 1980s. The conference now carrying the Big East name was founded with another name in 2012 or so and then bought the Big East name.

 

[businesslawyer]

You’re still stuck on the $100 mill as the only thing that mattered, ignoring the $35 mill in fees that they kept and ignoring the Big East name and the MSG tournament, both of which had tremendous value. It’s like a divorce in which one party gets cash but the other gets cash, an investment portfolio, the mansion on 10 acres, and the Rolls. And then the one with the cash thinks he got it all.

No, you’re stuck on how you think words and the law should work instead of the reality of the situation.

 

[Zissou]

There is a practical result and there are the technicalities of the bridge from the old Big East to the new Big East.

The Big East continued with larger share of its original members, its name, and the MSG contract.

It technically formed a new entity and transferred the name and the MSG contract, but that was just a mechanism.

I think the divorce analogy is a good one. The new Big East kept more of the value of assets (Name and MSG Contract), agreed to leave more cash with the AAC, and both sides agreed to the split with no further exit fees (which was a valued concession).

The Big East and the AAC formally agreed to share the records and the history of the original Big East.

The AAC contains no members of the Big East from its early years. The Big East has Georgetown, St John’s, UConn, Providence, Seton Hall, and Nova.

 

[JeepCSC]

There is a practical result and there are the technicalities of the bridge from the old Big East to the new Big East.

The Big East continued with larger share of its original members, its name, and the MSG contract.

It technically formed a new entity and transferred the name and the MSG contract, but that was just a mechanism.

I think the divorce analogy is a good one. The new Big East kept more of the value of assets (Name and MSG Contract), agreed to leave more cash with the AAC, and both sides agreed to the split with no further exit fees (which was a valued concession).

The Big East and the AAC formally agreed to share the records and the history of the original Big East.

The AAC contains no members of the Big East from its early years. The Big East has Georgetown, St John’s, UConn, Providence, Seton Hall, and Nova.

Even if you agree with all that, West Virginia was poached before the divorce. It was a member of the original Big East.

 

[Zissou]

Even if you agree with all that, West Virginia was poached before the divorce. It was a member of the original Big East.

WVU was a 90s add. Not one of the first 9 from the 80s, and never a real fit to the conference. They did fill out the football schedule when that was important.

 

[JeepCSC]

WVU was a 90s add. Not one of the first 9 from the 80s, and never a real fit to the conference. They did fill out the football schedule when that was important.

So a member of the original BE, got it.

 

[Billy Jack]

Some peopl seem to be having difficulty with the meaning of th word “original”, which derives from the word origins, or beginnings. For example, when we talk about the origins of the United States, we don’t include Alaska. We talk about “the original 13 colonies”. Even though the nation expanded to eventually include 37 other states, they are not considered as part of the original colonies.

The original Big East had 8 members, one of whom delayed beginning competition for a year due to obligations to another conference. If we want to expand a little bit to the “beginnings” of the conference, we could include Pitt because they began competition 3 years after the conference began.

That was the original Big East. It had no football, and didn’t begin competition in football until 12 years later. For the first 4 years of Big East Football, half of its football teams were associate members of the conference for football only. Two of those joined as full members of the Big East 4 years later. A third was invited to join the conference as a full member 5 years after that.

If there’s any doubt about whether the current Big East is some new entity, we can simply refer to the separation agreement at the time the C7 initiated the split from the football side of the conference in 2012-13. As part of that agreement it was resolved that 1979 would be recognized as the official starting date of both of the 2 now separate conferences which emerged out of this split. That’s the official record, which confirms the notion of a split, or a separation, of the 2 halves of the Big East. So, the current conference didn’t begin in 2013; it officially began in 1979.

 

[FfldCntyFan]

Some people are having difficulty accepting the fact that a new legal entity, using a name that they negotiated the rights to, is no longer the former legal entity.

There was a professional baseball team in the 1800's named the New York Metropolitans. The team that now plays in Queens has the same name but they are not the former professional team. Conversely, the MLB team that is now called the Guardians is the same professional team that has been playing in Cleveland for more than a dozen decades.

Look up the NCAA's record keeping. According to that the conference that began in 1979 as the Big East is currently in existence as the AAC.

 

[Ha Who]

seems like one out of every 40 posts is a tweet. Time to put this thread to bed mods

 

[Hogoff]

Some peopl seem to be having difficulty with the meaning of th word “original”, which derives from the word origins, or beginnings. For example, when we talk about the origins of the United States, we don’t include Alaska. We talk about “the original 13 colonies”. Even though the nation expanded to eventually include 37 other states, they are not considered as part of the original colonies.

The original Big East had 8 members, one of whom delayed beginning competition for a year due to obligations to another conference. If we want to expand a little bit to the “beginnings” of the conference, we could include Pitt because they began competition 3 years after the conference began.

That was the original Big East. It had no football, and didn’t begin competition in football until 12 years later. For the first 4 years of Big East Football, half of its football teams were associate members of the conference for football only. Two of those joined as full members of the Big East 4 years later. A third was invited to join the conference as a full member 5 years after that.

If there’s any doubt about whether the current Big East is some new entity, we can simply refer to the separation agreement at the time the C7 initiated the split from the football side of the conference in 2012-13. As part of that agreement it was resolved that 1979 would be recognized as the official starting date of both of the 2 now separate conferences which emerged out of this split. That’s the official record, which confirms the notion of a split, or a separation, of the 2 halves of the Big East. So, the current conference didn’t begin in 2013; it officially began in 1979.

The “original Big East” had 8 original members. The “new Big East” had 7 original members. West Virginia was part of the original Big East. They however were not an original member of the Big East.

 

[huskymedic]

Some peopl seem to be having difficulty with the meaning of th word “original”, which derives from the word origins, or beginnings.

Dude… let it go and move on.

 

[huskymedic]

seems like one out of every 40 posts is a tweet. Time to put this thread to bed mods

The thread will survive - It’s easier to put someone else to bed…

 

[JeepCSC]

The “original Big East” had 8 original members. The “new Big East” had 7 original members. West Virginia was part of the original Big East. They however were not an original member of the Big East.

This is right. The “original BE” is not the same as “original members of the original BE”. The “new BE” is not the same as new members of the either iteration of the BE.

There was a conference called the Big East from 1979-2013, it had fluctuating membership. Some were original members like Georgetown and Providence, some were not original members like Pittsburgh and West Virginia. All were members of the original BE. In 2013, a new conference was formed with 10 members, only 4 of which were actually original members of the original BE. It has been deemed the New Big East.

That’s the story, that’s all. Everything else is just a shell game.

 

[Ha Who]

The thread will survive - It’s easier to put someone else to bed…

Maybe it can be renamed same old newbie vs old BE argument

 

[Kolumbo]

Some peopl seem to be having difficulty with the meaning of th word “original”, which derives from the word origins, or beginnings. For example, when we talk about the origins of the United States, we don’t include Alaska. We talk about “the original 13 colonies”. Even though the nation expanded to eventually include 37 other states, they are not considered as part of the original colonies.

The original Big East had 8 members, one of whom delayed beginning competition for a year due to obligations to another conference. If we want to expand a little bit to the “beginnings” of the conference, we could include Pitt because they began competition 3 years after the conference began.

That was the original Big East. It had no football, and didn’t begin competition in football until 12 years later. For the first 4 years of Big East Football, half of its football teams were associate members of the conference for football only. Two of those joined as full members of the Big East 4 years later. A third was invited to join the conference as a full member 5 years after that.

If there’s any doubt about whether the current Big East is some new entity, we can simply refer to the separation agreement at the time the C7 initiated the split from the football side of the conference in 2012-13. As part of that agreement it was resolved that 1979 would be recognized as the official starting date of both of the 2 now separate conferences which emerged out of this split. That’s the official record, which confirms the notion of a split, or a separation, of the 2 halves of the Big East. So, the current conference didn’t begin in 2013; it officially began in 1979.

I'm starting to partially agree with the split rather than the C7 leaving, but according to wikipedia, the C7 left the conference. The best part of the wikipedia post is the fact that it line 1.4 was created:

 

[Zissou]

There was a conference called the Big East from 1979-2013, it had fluctuating membership. Some were original members like Georgetown and Providence, some were not original members like Pittsburgh and West Virginia. All were members of the original BE. In 2013, a new conference was formed with 10 members, only 4 of which were actually original members of the original BE. It has been deemed the New Big East.

There was a company called General Motors founded in 1908. In 2008, there was a bankruptcy and the founding of a new entity also called General Motors in 2009. Assets from the old GM were transferred to the new GM.

The new GM is 13 years old. It claims heritage to 1908. Not many are too caught up on the details of the legal entity, except of course the shareholders and pensioners that lost in the bankruptcy. Most consider it General Motors, with its full history.