A Massachusetts state court has delivered a compelling victory to Boston College, finding that the school must pay only $1 million as an exit fee when it departs the Big East Conference for the Atlantic Coast Conference in 2005.
The Big East, already jilted by other ACC converts — University of Miami and Virginia Polytechnic Institute and State University — had sought to hold BC and other school’s feet to the fire and make it pay a $5 million exit fee. To do that, it had to convince the court that a constitutional amendment created just as BC was announcing its intent to depart was applicable.
But the court would have none of it, finding that the Big East did not follow the process outlined in its constitution in passing the amendment.
The amendment was introduced by members frustrated with past and potential departures of conference members to other conferences. In addition to the monetary requirement, the conference also proposed a 27-month withdrawal provision, far exceeding the existing 12-month withdrawal notice period.
The Big East sought to enforce that amendment when, on October 12, 2003, BC notified each member school in writing that it was leaving the conference.
This, of course, spawned the legal dispute.
In its analysis, the court noted that Boston College supported the proposed amendment up until the fall of 2003. At that point, Father Dobbin, President of Villanova University and Chair of the Big East Presidents, faxed an explanatory memorandum and ballot, requesting a vote on a proposed amendment that would amend the Constitution to include a $ 5 million penalty, 27-month withdrawal provision. Members schools were expected to fax their vote back, which each did, except for Boston College and Notre Dame, which abstained.
The court compared the process for passing an amendment, pursuant to the Constitution, with the actual process that was followed. The court zeroed in on Article VIII, “which is the only article or section specifically addressing amendments, and it purports only to deal with amendments. It thus deserves to be construed with some indicia of primacy on the subject.”
Both parties agreed that Article VIII, which requires the conferences to be present when voting for example, was not followed with regard to the purported amendment on October 6, 2003.
The Big East’s argument, however, was that it was not required to follow Article VIII in adopting the amendment in issue, but rather Section 5.05 of the Constitution.
That section provides that a vote may be taken by mail, fax or telephone. However, those methods, noted the court, applied to any “regular business” of the Conference.
“If two provisions of a contract are in conflict, the specific provision controls over the more general provision. Southwestern Elec. Corp., Inc. v. FERC, 358 U.S. App. D.C. 250, 347 F.3d 975, 982 (D.C.Cir. 2003),” according to the court. “Here, Article VIII is specific on the issue of amendments to the Constitution; while Section 5.05 is general in its application, if it deals at all, with amendments.”
In a statement, BC AD Gene DeFilippo said: “We are gratified that, after nearly a year of adverse and misleading public statements leveled against us, a respected judge has seen through the actual merits of the case and has ruled in favor of Boston College.”
In his statement, Big East commissioner Mike Tranghese said he was “extremely disappointed with the court’s decision today.” The Trustees of Boston College v. The Big East Conference, Superior Ct. Mass. Suffolk, 03-4818 BLS, 8/18/04
