Because I like pain and, in fact, eat it like candy, I have done a deep dive on the mediation process, the implications of the June 1 deadline, and how the looming House settlement could impact this (or not), in order to be able to see the future. Here is next week’s news today:
- The fact that the mediation process is so quiet shows that the parties are actually talking. I was around mediations in a different life, and a voluntary gag rule is very common when the parties actually want to make good faith efforts at getting to a deal.
- The process around the House settlement is significantly FUBAR’d. Once again, the NCAA and its attorneys have lowered the bar for competence. The judge gave them signals back in April that they needed to tweak the roster limits rule. They ignored her, so then she gave them a written order to change it. As I understand it, the NCAA and its schools again shrugged her off and said they would make the roster limits voluntary by each school, but wouldn’t mandate any protections for current students at risk of losing roster spots due to the settlement. It’s always difficult to predict what a federal judge will do, but given that the NCAA is now 0-17 in litigation on this stuff, and that the judge was explicit in what she wanted to see, it will not surprise me at all to see the House settlement not approved before July 1. That will have significant follow-on impacts, such as:
- This whole new revenue sharing scheme is based on the House settlement being approved. If it’s not approved, revenues can’t be shared UNLESS schools are in states that have already enacted laws allowing direct payments to athletes. This means that we will see the current Wild West continue if the settlement isn’t approved, except it will be worse because some schools will have a competitive advantage with state laws in place to govern where the NCAA is absent.
- There is some nuance here that is very dangerous. UNLV agreed to stay with the MW only because they were promised significant payments that will be funded by the exit and poaching fees that the MW is contractually due. If the MW and PAC are trying to reach a mediated agreement, that means that each party is willing to accept something less than they think they are owed. If the MW doesn’t get all the penalties and fees, they will not have the resources to pay the blood money to UNLV (or to make the payments due other schools like Wyoming in exchange for the GOR agreement). A mediated deal necessarily means the terms of the deal with UNLV must change. I believe this is why there are rumors that UNLV is a direct party in the mediation room along with representatives of the MW and PAC, and why there were (silly) rumors again this week about Big 12 contacts with Vegas. UNLV is very likely looking at a negotiated buyout if the MW has to walk back any of the payments they were promised.
- The PAC has no idea what its future looks like. The House settlement is now uncertain. If they had an idea of the contours of their next media deal, they would have said so by now and secured their final member. All of this means that they have absolutely no idea what their revenue picture looks like in 2027. They did have a war chest, but that is being depleted as they pay for football scheduling. This is an untenable situation, and that means they have to change it, and that is why they are still in the room for mediation.
- The June 1 “deadline” is in the MW bylaws. Anyone who has dealt with corporate bylaws knows they are easy to change or to simply ignore. My best guess is that the mediation process will continue until there is clarity around the House settlement. This can be easily done if all parties agree to an extension. I will be very, very surprised if we see any announcements other than an agreement to keep talking.
- This, of course, is exactly what Gloria should NOT do. The MW’s leverage will never be greater than it is this week. All the revenue uncertainty plays against the PAC relative to this negotiation. Gloria should put their backs to the wall and make the best deal she can at around 10 pm Saturday night (so the lawyers can have an hour or two to paper it up). If we read on Sunday that the mediation has been extended, this is a good sign that the MW is losing ground.
- The fact that the mediation process is so quiet shows that the parties are actually talking. I was around mediations in a different life, and a voluntary gag rule is very common when the parties actually want to make good faith efforts at getting to a deal.
- The process around the House settlement is significantly FUBAR’d. Once again, the NCAA and its attorneys have lowered the bar for competence. The judge gave them signals back in April that they needed to tweak the roster limits rule. They ignored her, so then she gave them a written order to change it. As I understand it, the NCAA and its schools again shrugged her off and said they would make the roster limits voluntary by each school, but wouldn’t mandate any protections for current students at risk of losing roster spots due to the settlement. It’s always difficult to predict what a federal judge will do, but given that the NCAA is now 0-17 in litigation on this stuff, and that the judge was explicit in what she wanted to see, it will not surprise me at all to see the House settlement not approved before July 1. That will have significant follow-on impacts, such as:
- This whole new revenue sharing scheme is based on the House settlement being approved. If it’s not approved, revenues can’t be shared UNLESS schools are in states that have already enacted laws allowing direct payments to athletes. This means that we will see the current Wild West continue if the settlement isn’t approved, except it will be worse because some schools will have a competitive advantage with state laws in place to govern where the NCAA is absent.
- There is some nuance here that is very dangerous. UNLV agreed to stay with the MW only because they were promised significant payments that will be funded by the exit and poaching fees that the MW is contractually due. If the MW and PAC are trying to reach a mediated agreement, that means that each party is willing to accept something less than they think they are owed. If the MW doesn’t get all the penalties and fees, they will not have the resources to pay the blood money to UNLV (or to make the payments due other schools like Wyoming in exchange for the GOR agreement). A mediated deal necessarily means the terms of the deal with UNLV must change. I believe this is why there are rumors that UNLV is a direct party in the mediation room along with representatives of the MW and PAC, and why there were (silly) rumors again this week about Big 12 contacts with Vegas. UNLV is very likely looking at a negotiated buyout if the MW has to walk back any of the payments they were promised.
- The PAC has no idea what its future looks like. The House settlement is now uncertain. If they had an idea of the contours of their next media deal, they would have said so by now and secured their final member. All of this means that they have absolutely no idea what their revenue picture looks like in 2027. They did have a war chest, but that is being depleted as they pay for football scheduling. This is an untenable situation, and that means they have to change it, and that is why they are still in the room for mediation.
- The June 1 “deadline” is in the MW bylaws. Anyone who has dealt with corporate bylaws knows they are easy to change or to simply ignore. My best guess is that the mediation process will continue until there is clarity around the House settlement. This can be easily done if all parties agree to an extension. I will be very, very surprised if we see any announcements other than an agreement to keep talking.
- This, of course, is exactly what Gloria should NOT do. The MW’s leverage will never be greater than it is this week. All the revenue uncertainty plays against the PAC relative to this negotiation. Gloria should put their backs to the wall and make the best deal she can at around 10 pm Saturday night (so the lawyers can have an hour or two to paper it up). If we read on Sunday that the mediation has been extended, this is a good sign that the MW is losing ground.
