Clemson agrees to drop lawsuit, settle with the ACC. What it means for Tigers’ future
Clemson’s legal battle against the ACC is coming to an end.
The Clemson University Board of Trustees approved a settlement Tuesday that allows the school and the conference to drop their dueling lawsuits in exchange for a deal that keeps Clemson in the ACC while giving them more revenue opportunities.
This development does not close the door on Clemson ultimately leaving the ACC and, in theory, actually makes it easier to do so, starting in 2030.
But the settlement is expected to bring some short-term stability to the conference and keep the Tigers as a member for the immediate future.
Clemson, a founding member of the ACC, had initially sued its own conference in March 2024 in Pickens County, South Carolina, where the university is located.
That lawsuit was widely viewed as an initial step toward Clemson leaving the ACC for another conference, such as the SEC or Big Ten, that could better fund the Tigers’ football team and other sports because of stronger TV deals and conference payouts.
Florida State sued the ACC on similar grounds in December 2023. The ACC, headquartered in Charlotte, counter-sued both schools in North Carolina court.
Now, all four lawsuits in that battle over the league’s revenue situation and “grant of rights” — which laid out a steep financial penalty for schools trying to leave the ACC and said they’d forfeit hundreds of millions of dollars in media rights to the conference through 2036 if they did — are expected to be dropped in exchange for a settlement that’ll bring significant changes to the league.
Clemson’s full board of trustees had a specially called meeting via Zoom on Tuesday with one action item: Voting to give “approval to authorize the administration to settle athletic litigations.” Clemson athletic director Graham Neff and general counsel Chip Hood (the university’s lead attorney) were the presenters.
After a roughly 25-minute executive session and a presentation by Neff and Hood in public session, the board of trustees voted unanimously to give Clements, the president, approval to move forward with the settlement on Clemson’s behalf.
The university also confirmed the move in a news release.
“This settlement allows Clemson to remain nationally competitive at the highest levels and makes our conference stronger,” Clements said in a statement Tuesday, adding that the Tigers remain “proud members of the ACC.”
Neff said in a statement that Clemson was “incredibly thankful for all of the time and work that has gone into this proposed settlement.”
“We often talk about competitive excellence, and this settlement allows us to leverage our national brand to fuel that success,” he said.
FSU’s board of trustees and the ACC’s board of directors, which is made up of the presidents and chancellors of its 18 member schools, also met Tuesday and approved the settlement, they confirmed in statements.
All three boards had to approve the settlement for it to go into effect.
“Today’s resolution begins the next chapter of this storied league and further solidifies the ACC as a premier conference,” ACC commissioner Jim Phillips said.
Explaining the ‘brand initiative’
The settlement stemming from the ACC, Clemson and FSU disputes will lead to two major tweaks: Establishing a new “brand initiative” that’ll give additional revenue to the ACC schools with the best television ratings, and reducing how much money it would cost for a school to leave the conference down the line.
Naturally, both of those developments heavily favor Clemson and Florida State, who are generally viewed as having two of the ACC’s most valuable brands and football programs and come up frequently in big-picture college athletics realignment talks.
In Tuesday’s presentation, Neff said Clemson is anticipating a “projected opportunity” of over $120 million in new revenue over the six years under the ACC’s new brand initiative. That comes out to an additional $20 million annually.
Other ACC schools with lower TV ratings could lose about $7 million in their annual payouts as a result of this unequal revenue distribution, according to ESPN.
But administrators told ESPN that’s an “acceptable” loss, because the trade off is a settlement that offers short-term stability to all 18 member schools (and, for now, keeps the ACC from dissolving overnight in the same way the Pac-12 did).
In addition to the expected brand initiative revenue, Neff noted that Clemson can also receive significant money from College Football Playoff participation under the ACC’s “success initiative” which went into effect for the 2024-25 athletic year.
For example, the Tigers earned $4 million from the ACC for qualifying for the 2024 CFP and do not have to share that money with any other school.
“Ultimately, this really provides incentive to further invest and take actions that enhance competitive excellence and, ultimately, viewership,” Neff said.
What about the grant of rights?
Another big part of the lawsuits against the ACC was getting further clarity on the league’s grant of rights and determining how much it would cost for a school to leave the conference before the ACC’s television deal with ESPN expires.
The ACC and ESPN have a television contract through 2036. It was viewed as strong when it was initially signed in 2016 but quickly paled in comparison to the SEC and Big Ten’s TV deals, which led to significantly higher per-school conference payouts.
Between an exit fee and however many years of media rights revenue a school had to forfeit, lawyers representing FSU initially ballparked the cost of leaving in 2024 at nearly $600 million in 2024 (an exit fee plus 12 years of uber-valuable media rights).
The new settlement will alter the grant of rights to include “declining financial penalties” year by year for any school that leaves the ACC before 2036 and more explicitly define the cost of a school leaving with a singular number.
Per Clemson’s presentation, the ACC’s exit fee for fiscal year 2026 is over $165 million. That fee will decrease by $18 million annually until it reaches 2030-31.
At that point, the fee will “level off” at $75 million and remain at $75 million for each academic year through the expiration of the ACC-ESPN deal in 2036.
Even more critically: Upon payment of the ACC exit fee, a school would also leave with its future media rights fully intact and would not have to forfeit those rights (worth hundreds of millions of dollars) to the conference through 2036.
Neff said the settlement brings “absolute clarity” to Clemson’s media rights.
Fireworks in 2030?
It’s no coincidence that ACC schools would be able to leave their conference on a significant discount starting in 2030. Around that time, ESPN reported, television deals for the Big Ten, the Big 12 and the College Football Playoff — which recently expanded from four teams to 12 teams — will be up for contract renewal.
TV deals play a huge role in conference realignment and often trigger major movements among schools as they come up for renewal, such as the SEC poaching Oklahoma and Texas from the Big 12 during summer 2021.
A drop in the cost of leaving the ACC for 2030 and beyond will provide schools such as Clemson “flexibility” during that critical time, Neff acknowledged Tuesday.
Clemson leaders praised Tuesday’s news as a win for the university, which will reportedly spend $3 to $5 million in total legal fees for a court battle with the ACC that lasted just under a year (final numbers weren’t immediately available).
The league’s new brand initiative “will help strengthen the ACC,” Neff said. “A strong ACC is good for Clemson, and a strong Clemson is good for the ACC.”
Clements said he thought the settlement was an “excellent outcome.”
“We achieved our goals,” Clements told the board of trustees. “We have enhanced revenue opportunities that will allow us to stay competitive on a national basis, and we remain a proud member of the ACC, which is a great home for Clemson.”
This story was originally published March 4, 2025 at 12:44 PM.
