Pac-12 files lawsuit against MWC over costly ‘poaching fine’

The battle between the Mountain West and the Pac-12 now moves to the courts.

The Pac-12 filed a legal complaint Tuesday over millions of dollars in fines the Mountain West expects to pay for its acquisition of five MWC schools, describing the complaint as unlawful, unenforceable and a violation of antitrust laws.

The league filed a petition Tuesday morning in the U.S. District Court for the Northern District of California, requesting a declaratory judgment from a judge.

Now embroiled in a membership redistricting battle, the Pac-12 and Mountain West, often seen as sister leagues, are at the center of the conference’s latest redistricting shakeup. In an effort to rebuild, the Pac-12 has already acquired five Mountain West schools and has made an offer for at least one more, UNLV, which has not made a decision on its future as of noon ET.

The lawsuit, filed Tuesday, alleges a “poaching penalty” that was included in a scheduling agreement the two conferences reached last year. League commissioner Gloria Nevarez was aware of the Pac-12’s potential plans to rebuild with Mountain West affiliates and included the penalty in the agreement as a disincentive.

The lawsuit does not address Mountain West’s exit fees, which amount to more than $17 million per school.

The poaching penalty is $10 million for each school acquired by the Mountain West. With each new addition, that rate increases by about $1 million. After the additions of Boise State, Fresno State, San Diego State and Colorado State to the Pac-12, the Mountain West demanded that the Pac-12 pay $43 million in “liquidated damages” for the poaching penalty, the lawsuit says. That amount, with the addition of Utah State this week, now exceeds $50 million.

The complaint sets out reasons why the fine is unlawful, including (1) that it restrains trade; (2) that its sole purpose is to distort competition and deter schools from leaving for a competitor; and (3) that the damages are excessive and unreasonable “to the extent that the MWC may suffer the loss of its affiliated schools.”

“There is no legitimate justification for the poaching penalty,” the complaint states. “In fact, the MWC already seeks to impose tens of millions of dollars in exit fees on MWC schools that leave the conference. To the extent that the MWC would suffer as a result of the departure of its member schools, these exit fees more than adequately compensate the MWC.”

The five departing schools each owe at least $17 million in exit fees to the Mountain West. The Pac-12 is expected to cover a portion of the exit fees, according to those familiar with the agreements.

At the heart of the complaint is the scheduling agreement that the Pac-12 and its two members, Oregon State and Washington State, signed with the Mountain West to finalize their 2024 football schedules. The Pac-12 agreed to pay the Mountain West about $14 million for each school to play six games.

The two leagues negotiated intensively over the summer to extend the agreement for a second year in 2025 before talks broke down over price. According to the complaint, the Mountain West was demanding more than double that amount ($30 million) for the same number of games next year.

In its complaint, the Pac-12 alleges that the Mountain West imposed the poaching penalty on a depressed and desperate conference that was trying to find competition for hundreds of athletes at Oregon State and Washington State. The two schools acknowledged during negotiations that the penalty was unenforceable and illegal.

“In the wake of this mass exodus from the Pac-12, caused by fierce competition from rival conferences, the Pac-12 had only months to salvage the 2024-25 season and create opportunities for its 1,000 student-athletes to compete with other schools,” the complaint said.