Larry Scott killed the PAC-12
Earlier today, the Pac-12 terminated the employment of two senior executives, effective immediately. This action was taken following an investigation conducted by independent outside legal counsel. The terminations resulted from a failure by those two executives to disclose material information to the Pac-12 Board of Directors and external Pac-12 auditors in connection with overpayments by a Pac-12 Networks distribution partner dating back to 2016.
The Pac-12 took immediate and appropriate action to address this matter, consistent with best governance practices. Pac-12 leadership is committed to supporting our members and student-athletes, and always operating at the highest level of professionalism. A timeline concerning this matter is set forth below.
Timeline of Events:
Earlier today, the Pac-12 terminated the employment of two senior executives, effective immediately. This action was taken following an investigation conducted by independent outside legal counsel. The terminations resulted from a failure by those two executives to disclose material information to the Pac-12 Board of Directors and external Pac-12 auditors in connection with overpayments by a Pac-12 Networks distribution partner dating back to 2016.
The Pac-12 took immediate and appropriate action to address this matter, consistent with best governance practices. Pac-12 leadership is committed to supporting our members and student-athletes, and always operating at the highest level of professionalism. A timeline concerning this matter is set forth below.
Timeline of Events:
- In the spring of 2017, the Pac-12 Networks engaged the industry-leading auditor to conduct an audit of certain distribution partner payments.
- The audit concluded that one of the Pac-12 distribution partners had overpaid the Pac-12 Networks for the year 2016 by a material amount.
- The two Pac-12 executives whose employment were terminated today were made aware of the audit results in late December 2017.
- After receiving the audit results, the two executives failed to inform the Pac-12 Board of Directors or the Pac-12’s external auditors of the financial risk associated with the audit findings.
- Since 2017, the two executives have not shared the ongoing financial risk associated with the apparent overpayment with either the Pac-12 Board of Directors or the Pac-12’s external auditors.
- In October 2022, the distribution partner who was the subject of the 2017 audit claimed that it had been overpaying the Pac-12 each year since prior to 2016. The distribution partner claims that the overpayments total more than $50M.
- As soon as the distribution partner notified the Pac-12, the Pac-12 began looking into the claims, and determined that the Pac-12 should bring in independent legal counsel to review the facts of the situation.
- The Pac-12 Board of Directors Audit Committee promptly hired the law firm of Cooley LLP to conduct an independent investigation.
- In November 2022, the Commissioner briefed the Pac-12 Board of Directors on the distribution partner’s claim and the ongoing investigation being conducted by Cooley.
- Cooley concluded its investigation and on January 13, 2023 Cooley briefed the Commissioner on its findings.
- The Cooley investigation concluded that:
- Two current senior Pac-12 executives were aware of an overpayment from a distribution partner since late 2017;
- These executives failed in their obligations and duties to immediately disclose this information related to an immediate and material financial risk to the Pac-12 to the Pac-12 Board of Directors and the Pac-12’s external auditors; and
- These executives failed in their ongoing obligation and duty to disclose this information to the Pac-12 Board of Directors and the Pac-12’s external auditors.
- Based upon the findings of the investigation, the Commissioner made the decision to terminate the employment of the two Pac-12 senior executives.
- On January 19, 2023 the Board of Directors Executive Committee and the Chairman of the Pac-12 Audit Committee were briefed on the findings of the investigation and the decision to terminate the employment of the two Pac-12 senior executives.
- The terminations took place and are effective on January 20, 2023.