On July 21st, Pac-12 Commissioner George Kliavkoff said that the poaching of colleges was “not a concern” at Pac-12 media day. Kliavkoff continued: “Our schools are committed to each other and the Pac-12. We’ll get our media rights deal done, we’ll announce the deal. I think the realignment that’s going on in college athletics will come to an end for this cycle.”
What does George Kliavkoff think now that the Pac-12 is in serious trouble?
Big-12 And Big-10 Picked The Pac-12 All-But Clean
The Big 10 and Big-12 conferences are on a mission to poach schools from other organizations, most notably the Pac 12, in a chase for larger rights fees. The Big-10 already has USC and UCLA, and now is reportedly pursuing Oregon and Washington (although one report asserts that those schools said no to that overture, other reports are to the contrary).
And as of this writing, The Pac-12 lost five schools in one shocking day to the Big 10 and Big-12 conferences. It’s a move that has legal ramifications that have not been well-considered publicly. Why? Because Big 10 and Big-12 conferences may have ran affowl of the Sherman Antitrust Act.
The Sherman Antitrust Act was passed by Congress in 1890, and written by Senator John Sherman of Ohio, who served on the Senate finance committee and the Secretary of the Treasury under President Hayes. The Sherman Antitrust Act was designed to curb the development of monopolies, where one or a few companies control the market for a particular product or service.
The Actions That Caused The Sherman Antitrust Act Are Apparent In Big-10 And Big-12 vs Pac-12
The development that gave rise to the passage of the Sherman Antitrust Act has a similar look to today’s problem with Big 10 and Big-12 conferences and the luring of teams from other conferences to join them, and in a world of a relatively small pool of organizations of that type.
The overall reason there is this rush to form these super-conferences, is the value of media rights: the more teams in one conference, the more expensive the rights fees can be. But the action of shifting teams from one conference to another is a zero-sum game: someone’s win is another one’s loss.
The Big 10’s and Big-12’s college poaching actions created this situation and George Kliavkoff let it happen: Oregon and Washington are joining the Big Ten (forming an 18-team superconference that extends from Washington to New Jersey and taking a head-scratching cut in fee payouts in the process) and Arizona, Arizona State and Utah are joining Colorado in the Big 12. The Pac 12 would be reduced to just four schools: Cal, Stanford, Oregon State and Washington State, and only one old rivalry, Cal and Stanford, by 2025.
The Pac-12 Should Sue The Big-12 And Big-10, And Here’s Why
The question for the flock is why are these moves not subject to antitrust scrutiny and where’s the injunction from the Pac-12, considering that George Kliavkoff is a trained trial lawyer? With all of the moves, and the shrinking of the Pac 12, what’s to stop the Big 12 and Big 10 from merging into one mega-conference? And, again, isn’t that a violation of Sherman Antitrust Act?
That’s a question that was taken up as far back as 2010, or 13 years ago, in Bleacher Report, by Jeff Kalafa (not an antitrust economist or lawyer, but he wrote about it, nonetheless), in “Is 16 Team Big Ten In Violation Of Sherman Antitrust Act?” https://bleacherreport.com/articles/384438-is-16-team-big-ten-in-violation-of-sherman-antitrust-act
Kalafa wrote:
“Before the Big Ten Conference and its Big Ten Network expands to 16 teams—and I don’t know if they will—the powers to be might want to figure out if they will be in violation of the Sherman Antitrust Act. The Sherman Antitrust Act of 1890 was the first legislation passed by the United States Congress to deal with monopolies. Would a 16 team college athletic conference fall under the term monopoly? Probably not. The Big East has 16 members in their basketball conference and nobody has compared it to a monopoly.
The Big Ten Network currently reaches 40 million households and is available to 73 million. Add Rutgers, Syracuse, Pitt, and possibly Connecticut to the Big Ten Conference and suddenly the Big Ten Network would be looking at an extra 20 million possible households. With the addition of one more team, regardless of its location, the Big Ten is looking at nearly 100 million potential households, or close to 40 percent of all households in the country.”
Bleacher Report, 2010
Collusion For College Sports Market Rule And Control
The consequences for the formation of mega-conferences could also lead to a standardized Name-Image-Likeness Policy – and doing that would certain and should trigger lawsuits asserting collusion.
Collusion is a common symptom in the determination of anti-competitive behavior. Investopedia says that collusion “is said to happen when entities or individuals work together to influence a market or pricing for their own advantage. Acts of collusion include price fixing, synchronized advertising, and sharing insider information. Antitrust and whistleblower laws help to deter collusion.”
With All Of These Legal Landmines, Why Didn’t The Pact 12 Just Fire Off Lawsuits?
Since the Pac-12 is the conference being torn apart by these actions, why hasn’t Pac-12 Commissioner George Kliavkoff fired off lawsuits tossing the Big 12 and Big-10 into court? It’s clear that the schools electing to leave had incentive to collude to do so, and that’s a scenario which could produce a legal victory, if a lawsuit was filed. Instead, Kliavkoff just issued this comparatively tepid statement:
“Today’s news is incredibly disappointing for our student-athletes, fans, alumni and staff of the Pac-12 who cherish the over 100-year history, tradition and rivalries of the Conference of Champions,” the statement read. “We remain focused on securing the best possible future for each of our member universities.”
The Pac-12 Is Now On Life Support, With Low-Revenue Sports Facing A Dire Future
George Kliavkoff was hired to be Pac-12 Commissioner in 2021, and is someone the author of this article met at an impromptu gathering at the main NFL Hotel at Super Bowl XXXVII. Then, George was with MLB Advanced Media, and his resume includes stints with a vast number of boards of directors, and then an executive role in gaming with MGM, but no situation where he was responsible for guiding an organization, even a tech startup.
Moreover, George has no Pac-12 college ties; he went to Boston University College of Communication and got his law degree from the University of Virginia. Yet, without any clear kearnal of evidence that George would be able to handle the crisis that was forming before he was taking the Pac-12 job, the Pac-12 Conference hired him. He has to figure out an answer, and soon. What should he do?
Oregon State athletic director Scott Barnes said to the Oregonian that “I’ve never seen so many last-minute decisions and twists and turns as I’ve seen through this process. Conference realignment just doesn’t make sense anymore. What this enterprise was built on was regionality and rivalries. That is gone. That is leaving the Pac-12. Some of the most special pieces about our model is regionality of competition and rivalries. Those things are forgotten.”
The Big-10 and Big-12 vs. Pac-12 Affair Is Clearly Marked By Collusion
One thing that can’t be forgotten is the appearance of collusion. How else to explain the dashed expectations of Pac-12 athletic directors who chose to remain loyal to the conference? Washington State President Kirk Schulz and Athletic Director Pat Chun issued this statement: “We are disappointed with the recent decisions by some of our Pac-12 peers. While we had hoped that our membership would remain together, this outcome was always a possibility and we have been working diligently to determine what is next for Washington State athletics. We’ve prepared for numerous scenarios, including our current situation. With exceptional student-athletes, a strong Cougar tradition and incredible support from our fans, donors and alumni, we will chart the best path forward together.”
What the next move is for the Pac-12 is as murky as the reasons why George Kliavkoff and company allowed the other conferences to pick at the proud organization until it was down to its near death place, today. One option is for the Pac-12 to come out fighting in court, at the same time, working to build a new, regionally-focused conference. That’s a better choice than a future which sends students on planes cross country to play sports, taking up more travel money and time.
It’s George’s call. Stay tuned to ZENNIEREPORT.COM.
Note: Zennie Abraham is a graduate of the Masters in City and Regional Planning Program at Cal, and a member of the California Alumni Association Board of Directors from 1998 to 2003.