Pac-12 files lawsuit against Mountain West over more than $50 million in poaching fees

The latest twist in the Pac-12’s conference realignment efforts could next involve a courtroom. The Pac-12 on Tuesday filed a lawsuit against the Mountain West, arguing that the tens of millions it owes the Mountain West in poaching fees due to a prior scheduling agreement between the two leagues amount to an antitrust violation.

Two weeks ago, the Pac-12 officially added four Mountain West schools — Boise State, Colorado State, Fresno State, San Diego State — which would put the fee owed to the Mountain West at $43 million, on top of an estimated $18 million per school in exit fees.

“The Poaching Penalty saddles the Pac-12 with exorbitant and punitive monetary fees for engaging in competition by accepting MWC member schools into the Pac-12,” the complaint reads. “The MWC imposed this Poaching Penalty at a time when the Pac-12 was desperate to schedule football games for its two remaining members and had little leverage to reject this naked restraint on competition. But that does not make the Poaching Penalty any less illegal, and the Pac-12 is asking the Court to declare this provision invalid and unenforceable.”

In late 2023, the Pac-12 and Mountain West signed a 2024 football scheduling agreement, through which the Mountain West added Oregon State and Washington State to its teams’ schedules in exchange for $14 million. But as laid out in the agreement, the sides would also work in “good faith” to potentially merge their leagues. There was also a table of poaching penalty fees the Pac-12 would face if it added some but not all Mountain West schools, ranging from $10 million for one school up to $137.5 million for 11 schools. There would be no fee for adding all 12 schools. The contract, which also stipulated that it remained in effect two years beyond the end date of the scheduling agreement, was signed by Oregon State, Washington State, former Pac-12 commissioner George Kliavkoff and Mountain West commissioner Gloria Nevarez.

“Knowing that the Pac-12 was running out of time and short on leverage, the MWC not only charged the Pac-12 supra-competitive prices to schedule football games — over $14 million for OSU and WSU to play just six games each — but it also forced the Pac-12 to accept an unprecedented Poaching Penalty provision wholly unrelated to scheduling football games and designed to limit the Pac-12’s ability to compete with the MWC for years into the future, even after the Scheduling Agreement will expire,” the lawsuit reads.

Included in the complaint is a Sept. 12 letter from the Mountain West to the Pac-12, saying the Pac-12 would owe $43 million in poaching fees. The Pac-12 responded in a Sept. 24 letter, saying the poaching fees were unenforceable.

On Monday, as the Pac-12’s expansion plans moved into backup options once the American Athletic Conference announced it would be sticking together, Utah State agreed to join the Pac-12, which would up the poaching fee to $55 million owed to the Mountain West. The lawsuit also provided the first public confirmation from the Pac-12 that it has accepted Utah State into the league.

The Pac-12’s actions have led many in the industry to wonder how and why the conference might be undertaking the most expensive realignment change in history just to create another version of the Mountain West. Sources briefed on the Pac-12’s thinking over the past two weeks felt the league could get out of the fees in some way, while Mountain West sources counter that the terms are laid out plainly in the contract.

The Mountain West could move to dissolve itself through a vote from two-thirds of its members, thereby waiving all exit and poaching fees. But it does not appear the Pac-12 is interested in enough members to reach that threshold.

Now it could be up to a court to decide, unless the Pac-12 and Mountain West come to some sort of settlement agreement to lessen that cost, which is often the result of these situations. Maryland and the ACC sued each other over the Terrapins’ exit for the Big Ten, resulting in a lower exit fee. Southern Miss, Marshall and Old Dominion sued Conference USA in 2021. Florida State and Clemson are currently suing the ACC in an attempt to get out of a binding grant of rights.

But a lawsuit between conferences is a new one because there has never been a situation quite like this. The Pac-12, down to just two members, refused to pack up and merge into the Mountain West. The bad blood and hard feelings between the sides dates back months, as their attempt to extend the scheduling agreement to 2025 fell apart. The lawsuit claims the Mountain West demanded $30 million to extend the scheduling agreement for 2025.

Now, like seemingly everything else involving college sports, the lawyers are involved.

(Photo: Chris Gardner / Getty Images)