The League of Legends competitive leaders are making this far too complicated. They are attempting to create an entirely new system to rank teams rather than using other online league structures that have proven to be successful. Riot you have the possibility to create one of the most competitive PC gaming communities to date, one that could rival the CoD, TF2 and DotA communities and hopefully one day achieve what CSS has been able too.
1) Create a Season of Competition
2) Open sign ups to all teams with a minimum being 5 and maximum being 8 (for 5's comp)
3) For season two I believe Riot could do a much better job, rather than everything being judged off of elo I believe the elo should be a part of the ranking system not determine the whole thing, because though I don't want to discuss it here because it could never end I believe the elo ranking system to not provide the best conditions for a competitive community to develop.
4) Once teams are signed up the task of ranking the teams begin. Going off of the current NewEgg Wanfest team list of around 250 teams I think a riot tournament could pull in nearly double this amount or rather close, probably around 350-450. So lets for example sake say we have 400 teams sign up. In order to rank them for the tournament I believe they should be ranked in two phases. At the start time of the tournament take the average 5's premade elo of each team and rank the teams from 1-400 based on this.
5) Once the teams are ranked by their premade 5's average elo a single elimination tournament begins much like the WanFest one and a winner is decided. Because of the format teams will come out of the tournament with a general ranking. After round 1 all teams that lost will be placed into the 200-400 bracket called the OPEN devision. The remaining 200 teams will continue and round 2 will eliminate 100 teams, round 3 eliminating 50 teams, etc. 3 devisions could be established following the tournament. OPEN division = teams 200-400 and any new teams
MAIN division = teams 50-200
PRO division = top 50 teams
6) Once these 3 devisions are created a season can begin with a set amount of weeks with a match each week, generally 8-12 weeks is acceptable. After this the record of each team will be taken and they will be placed into a playoff format with a tournament occurring for each devision. The top teams from Open can move up to Main and the worst teams in Main will move down to Open. The top teams from the Main tournament move up to Pro and the worst teams from Pro move down to Main. The top teams from Pro win money based on their tournament.
I realize this is a story but I hope everyone understands the structure I have proposed because this is the way many leagues function, the key is to get devisions that are easily manageable and then the best teams from each devision move up after each season and the worst move down, in this format the teams will be able to compete against players of their relative skill caliber as they improve and if they continue to improve as a team they will continually move up devisions. If we begin getting more teams then more devisions could be created but the more skilled the devisions get the smaller the amount of teams there should be so they can be showcased in broadcasts by companies that shoutcast games.
Hope this does something for somebody. I might make a forum post dedicated to this tournament format just to get community reactions. Lemme know what you think.