BRENTWOOD, Tenn. — Officials from the Ohio Valley Conference (OVC) filed suit in the courtroom of two different states Tuesday against two former member schools.
A suit was filed in Franklin County, Ky. against Eastern Kentucky University (EKU). The other suit was filed in Calhoun County, Ala. against former member Jacksonville State University.
OVC brought the suits to court to enforce payment of the contractually bound exit fees that the schools agreed to join the conference.
Eastern Kentucky notified conference officials on January 26 of their intent to depart the conference for the ASUN Conference (formerly known as the Atlantic Sun Conference). Jacksonville State made a similar communication on February 16 as they return to the ASUN Conference. Those actions were effective as of June 30.
Conference officials are referencing the Ohio Valley Conference Constitution, which is a contract between all member schools. And as stated, “The departure of any school from the Ohio Valley Conference requires the payment of an exit fee.”
While this is referenced, there is no presence of said constitution on the conference website, meaning it could be a privately-stored document or it might just be non-existent.
However, the exit fee clause was agreed upon by all conference members, including Eastern Kentucky and Jacksonville State.
As a result of their departures to the ASUN Conference, both schools are refusing to pay their respective exit fees
DeBauche: Ohio Valley Conference Board of Presidents regrets having to take action
OVC Commissioner Beth DeBauche made the announcement Tuesday morning, stating the conference’s Board of Presidents regrets having to take this step.
“The contract for all our members regarding exit fees is clear,” DeBauche said. “Eastern Kentucky University and Jacksonville State University agreed with the exit fees as part of the contract, and they voted in favor of those fees on multiple occasions. We expect them to honor their agreed-upon OVC commitments.”
DeBauche elaborates more on the amount of the exit fee, which is determined by the date of the notice provided. In the case of Eastern Kentucky and Jacksonville State, both notices were provided less than two years prior to their exit. Therefore, the exit fee is set at $1 million each.
“We are disappointed in the decision of both schools,” DeBauche adds. “And we expect them to do the right thing by fulfilling their contractual obligations.”
Eastern Kentucky has been a member since the founding of the conference in 1948. Jacksonville State has been a full conference member since 2003.
“They have benefited from their association with the OVC and with its fellow member institutions,” DeBauche notes. “To decide now that they don’t have to pay the fee not only violates their contract, [but] it is [also] unfair to the OVC’s member institutions, with whom these schools enjoyed long and mutually beneficial relationships.”
Fact sheet on the OVC lawsuits
The Ohio Valley Conference maintains several arguments as a part of their lawsuits against Eastern Kentucky and Jacksonville State. They include, but are not limited to the following:
The lawsuits against Eastern Kentucky and Jacksonville State ask for a judgment enforcing the schools’ former contracts with the conference, as well as a breach of contract and other related equitable claims.
Exit fees
Exit fees are a common practice in collegiate athletic conferences and are paid regularly. The practice has been a part of the OVC Constitution for more than 50 years, with no member school departing without complying with the requirement. There is no difference whether a member leaves voluntarily or is expelled from the conference via a board vote.
Eastern Kentucky and Jacksonville State are refusing to pay the exit fees they agreed to and voted upon many times as members of the conference.
Both schools gave the notice to depart the conference with less than a two-year notice. Eastern Kentucky provided their notice in January and Jacksonville State in February, effective June 30, 2021. The standard exit fee for a member institution giving notice of departure within the said timeframe is $1 million. If the departure would have been effective as of June 30, 2023, the exit fee would have been significantly lower.
Both schools have mutually benefitted from exit fees coming in from former institutions. Specifically mentioned was the 2008 departure of Samford University for the Southern Conference. Samford paid their exit fee, and both institutions benefitted from the proceeds. None of those proceeds were returned to the conference.
Breach of contract
The OVC Constitution is a binding contract for all member institutions, which includes the exit fee clause. Despite agreeing to this clause as part of the Constitution, both institutions are demanding and expecting special treatment by not having to pay this fee.
Both schools were reminded of their obligations several months ago and were ignored until just recently. Return communications prior to departure state that neither school will not abide by their commitments.
Furthermore, both schools are intending to act as if they were never members of the Ohio Valley Conference to begin with.
Retaliation
Officials from Eastern Kentucky have made threats toward the conference. Specified in the fact sheet were EKU’s threats to invoke financial harm against the conference if the provision was enforced.
A full transcript of the news release and statements will be attached below.
OVC Files Suit Against EKU JSU for Exit Fees – 080321 – Release Statement Fact Sheet
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