The contentious civil lawsuit between the Pac-12 and Mountain West conferences over exit and poaching fees, which has dragged on for 20 months, appears to be over.
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The two sides were set to have a discovery hearing Tuesday before Judge Susan van Keulen in the U.S. District Court in San Jose. Instead, a docket notation Monday said “the parties have informed the Court that they have reached a settlement in principle and requested the court vacate the May 19 hearing.”
A few hours later, the conferences issued a joint statement confirming they had “reached an agreement in principle to resolve the pending lawsuits.”
The sides have until June 2 to file a formal notice of settlement that is acceptable to the judge and would warrant dismissing the case. Terms were not immediately available, but both exit and poaching fees presumably will be less than the $150 million-plus initially owed.
San Diego State athletic director John David Wicker has previously said he expected the final exit fee to be roughly $10 million per school among the five that left the Mountain West. In previous lawsuits against other conferences, departing schools have typically paid about 50% of the stated exit fee.
The case had become a test of wills and bank accounts, as SDSU and the other Mountain West defectors sought to reduce exit fees estimated at $20 million each and the two original Pac-12 members sought to reduce $55 million in poaching fees outlined in a 2024 football scheduling agreement between the conferences.
“The MWC imposed this Poaching Penalty,” the legal complaint from September 2024 says, “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.”
The Mountain West’s counter: You negotiated it, your attorneys vetted it, you signed it, you owe every penny of it.
Both sides ultimately had motivation to settle after nearly two years of hearings, failed mediation, court rulings on motions and legal sword-rattling.
The thought was that the Pac-12 would try to drag out the case and force concessions from the Mountain West as a July 1 deadline approached to initiate promised “incentive” payments to its remaining members, most notably the elevated amounts pledged UNLV and Air Force.
But then Pac-12 financials were released last week, and there are indications the “war chest” left to Oregon State and Washington State by the departing 10 schools is rapidly depleting — meaning there might not have been enough to pay the full poaching fees if they lost the civil suit.
And in March, van Keulen dismissed one of the Mountain West’s counterclaims against the Pac-12 but ruled two others could proceed to trial, most notably the tortious interference claims. She also allowed the discovery process to include confidential communications between Mountain West presidents (and the proposed settlement came a day before a key discovery hearing).
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The Pac-12 is set to officially relaunch for the 2026-27 academic year with eight members for football and nine for basketball since Gonzaga doesn’t play football. That includes holdover members Oregon State and Washington State, plus five from the Mountain West: SDSU, Boise State, Colorado State, Fresno State and Utah State. Texas State was added later from the Sun Belt.
The Mountain West countered by adding UTEP in all sports; Grand Canyon in all sports except football, which it doesn’t play; Hawaii in all sports after only playing Mountain West football previously; Northern Illinois and North Dakota State in football only; and UC Davis in everything but football.
To retain the remaining six members, the Mountain West offered a distribution plan for the incoming exit and poaching fees in exchange for signing a grant of rights that binds them to the conference for six years. Payments were due to start no later than July 1.
The question becomes whether the Mountain West, if the settlement is indeed for only a portion of the contested amount, will have enough money to satisfy all of its promises.
In all, according to court documents, the Mountain West outlined how it would distribute $100 million from exit and poaching fees. Getting half of the $155 million it claimed it was owed would leave the conference at least $20 million short.
Of the first $61 million collected, UNLV and Air Force are each set to receive 24.5%, or $14.9 million. Nevada, New Mexico, San Jose State and Wyoming would get $7 million each, and Hawaii would get $3 million.
The next $18 million, the memorandum of understanding says, is “held in reserve and used by the conference to cover the expenses associated with recruiting new member institutions.”
That covers the first $79 million collected. The problem is that the conference is supposed to distribute the next $21 million according to the original percentages and only then pay any legal expenses, which figure to be hefty after 20 months of litigation.
The agreement also stipulates that the Mountain West pledges to maintain annual media rights fee distributions at current levels, or roughly $3.5 million per school per year, even if the conference’s new TV deal is below that.
The next legal issue may be, if the Mountain West can’t meet its obligations to current members, does that invalidate the grant of rights and allow a school like UNLV to jump conferences before 2032?
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