A North Carolina state appeals court has affirmed the ruling of a lower court for defendant Lenoir-Rhyne University in a case where student-athletes and a team manager for the women’s basketball team alleged that the school violated its contractual obligation to the students when it declined to renew their scholarships.
In sum, the appeals court agreed that “the plain language of the Grant-in-Aid (GIA) contracts limited the scholarships to one academic year, subject to renewal. The defendants were not obligated to automatically renew the scholarships after that year.”
The plaintiffs in the case were Laney Fox, Nakia Hooks, Ashley Woodroffe, Michaela Dixon, Sydney Wilson, Tamerah Brown, Kennedy Weigt, and Korbin Tipton (plaintiffs-athletes), who were recruited to play women’s basketball at Lenoir-Rhyne. In addition, Fatou Sall, who became the women’s basketball team manager while attending Lenoir-Rhyne and remained the team manager until November 2020, was also a plaintiff.
The aforementioned plaintiffs executed National Letters of Intent (NLI) to commit to the women’s basketball team, as well as GIAs to receive their athletic scholarships to Lenoir-Rhyne.
“Each GIA stated the scholarship was for a one-year period, and acknowledged this one-year limitation was according to the NCAA and Lenoir-Rhyne policies,” wrote the court. “These scholarships could not be reduced or cancelled during the one-year period apart from four exceptions that were specified in the GIAs. At the end of the academic year, according to the NCAA student-athlete handbook, the financial aid office was to notify the student-athlete of their award for the coming year. If the financial aid award was reduced or cancelled, the student-athlete would have the right to a hearing before the Athletics Appeal Committee upon a written request for appeal. Lenoir-Rhyne was required to comply with these regulations and policies to remain a member of Division II of the NCAA. Plaintiffs-athletes signed renewal GIAs each academic year when their scholarships were renewed.”
Plaintiffs Fox, Hooks, Woodroffe, and Tipton all claimed that they were “orally promised a four-year scholarship, automatic renewal of a yearly contract, or to play basketball for four years during their recruitments by Coach Cam Sealy, the previous women’s basketball coach, or Coach Grahm Smith, the current women’s basketball coach. They received their scholarships for the 2020-2021 academic year but were given the choice to opt out of the basketball season due to COVID-19 without any change in their scholarship status; only plaintiff-Fox opted out of the 2020-2021 basketball season starting in November 2020. Plaintiffs also assert the Lenoir-Rhyne student-handbook’s provision regarding freedom of expression for students was incorporated into the GIA contract.”
Meanwhile, Sall “orally agreed to be the women’s basketball team manager after attending a job fair at Lenoir-Rhyne. She did not receive any financial scholarship for her work as the basketball team manager. There was no written contract to be the manager, and each semester the coaches would ask plaintiff Sall if she was available to be the manager that semester. There was no set term agreed upon; it was a season-by-season position.”
Racial Tensions
“During the height of COVID-19 in the 2020-2021 basketball season, there were racial tensions within the basketball team that caused the coaches and some administrative personnel to hold a meeting with the team. The team agreed to limit their team communication to only basketball-related and team goal-oriented discussions. Plaintiff Fox organized a ‘Symposium’ for the basketball team and other university administrators to discuss racial prejudice, and later organized a second symposium, ‘The Talk,’ open to the entire university, to further discuss racial prejudice. Plaintiff Fox alleges the coaches sought to ‘retaliate’ against her and other African American teammates after these events.”
The plaintiffs claimed in their affidavits that they “were forced off the basketball team at the end of the 2020-2021 basketball season. Plaintiff Fox had a meeting with the coaches in which the coaches told her she did not fit into the culture of the team and that she would not be welcomed back onto the team for the 2021-2022 basketball season. The coaches offered to still give plaintiff Fox her full scholarship for the 2021-2022 basketball season. Plaintiff Fox ultimately entered the transfer portal to leave Lenoir-Rhyne. Although plaintiffs Dixon, Weigt, Hooks, Wilson, and Brown attested they were forced off the basketball team for the 2021-2022 basketball season, the affidavits of Coach Smith and Kim Pate, the V.P. of Athletics, attested the players planned to and did enter the transfer portal for the 2021-2022 basketball season.”
Plaintiff Sall attested in an affidavit that she was “involuntarily separated from the team.” During her deposition, she admitted she sent Coach Smith a text that stated, “If it isn’t already obvious, I will not be working with you guys this semester. Hope you guys have a great season.”
Fox later published social media images with statements and an “Open Letter to Lenoir-Rhyne” in which she made claims that she and other teammates were forced off the basketball team due to racism and retaliation. In response, Lenoir-Rhyne’s president, Frederick Whitt, published a letter to the Lenoir-Rhyne community in which he stated the following:
“Yesterday, a former student-athlete posted a number of false claims on social media, including that she was dismissed from the women’s basketball team for speaking out against racism and advocating for social justice. Lenoir-Rhyne flatly disagrees with this student’s version of events. Her dismissal from the basketball team was a legitimate coaching decision, and suggestions to the contrary are simply false.”
Fox also published a recording to social media of her meeting with the basketball coaches in which they told her she would no longer be on the basketball team.
The plaintiffs sued Lenoir-Rhyne, as well as co-defendants Grahm Smith, and Frederick Whitt in the summer of 2021, alleging the following: breach of contract, negligent misrepresentation, tortious interference with contractual rights, tortious interference with prospective economic advantage, and libel per se or alternatively libel subject to two interpretations.
The defendants filed a motion to dismiss, which the trial court granted, in part, leaving only the following remaining claims against Lenoir-Rhyne and Whitt: the breach of contract claim and the claim for libel subject to two interpretations. After discovery, the defendants filed a motion for summary judgment on the remaining claims against Lenoir-Rhyne and Whitt. After reviewing the parties’ affidavits, depositions, interrogatories, financial documents, contractual documents, and all exhibits presented, the trial court ultimately granted summary judgment to defendants. The plaintiffs appealed.
In considering the appeal, the panel wrote that “looking to the GIA contracts signed by plaintiffs-athletes, and to the NLI signed by plaintiffs Fox, Hooks, Woodroffe, Dixon, Brown, Weigt, and Tipton, the contractual language is nearly identical in each NLI and GIA. All parties agree these written contracts were valid, existing contracts, and only dispute the contractual terms and whether the parties breached these terms. The GIA contracts plainly state the scholarship award is ‘for one academic year.’ The record also includes GIA ‘renewal’ contracts, electronically signed by the plaintiffs-athletes, that specify one academic year for the scholarship and include conditions for the renewal of the scholarship. Based upon the evidence in the record, and recognizing any oral promises made in contradiction to the written contracts are not received, there is no genuine issue of material fact that the scholarship was limited to one year and subject to renewal with new contracts each academic year.”
Further, the plaintiffs also argue that the defendants could only cancel the GIA if the listed four conditions in the GIA apply. The original GIA contracts signed by the plaintiffs state the following:
“Upon the recommendation of the Head Coach and approval from the Director of Athletics, an Athletics Grant-in-Aid may be reduced or canceled during the period of the award by the institutional financial aid authority per NCAA Bylaw 15.6.4.1 if any of the following situations occur: (a) you render yourself ineligible for intercollegiate competition; (b) you fraudulently misrepresent, as defined in the Student-Athlete Handbook, any information on an application, Letter of Intent or financial aid agreement; (c) you engage in serious misconduct warranting substantial disciplinary penalty through the institution’s regular student disciplinary authority; or (d) you voluntarily withdraw from the sport at any time for personal reasons.”
The panel continued, noting that the “plain language within the contract dispels plaintiffs’ argument. It plainly states ‘during the period of the award.’ Apart from those terms within the GIA, plaintiffs point to no contractual provision that limits defendants’ ability to renew or cancel the scholarship after completion of the academic year. Defendants admit they removed plaintiff Fox from the basketball team after the 2020-2021 academic year. But defendants also state, in affidavits and through evidence of a renewal contract, that they awarded a scholarship to plaintiff Fox for the 2021-2022 academic year despite removing her from the basketball team.
“Plaintiff Fox admitted during her deposition that she entered the transfer portal to leave Lenoir-Rhyne. The NCAA Division II manual, section 15.5.5.1, and the Student-Athlete handbook, by which parties admit they were contractually bound, state defendants must let the student-athlete know ‘whether the grant has been renewed or not renewed for the ensuing academic year.’ Apart from the limitations during the academic period year, plaintiffs point to no requirement for the institutions to automatically renew grants once the academic year completes. The evidence in the record demonstrates the only obligation listed is to notify the student-athlete of the institution’s decision, but there is no obligation to renew the grant. Accordingly, based upon the record before us, plaintiffs fail to demonstrate a genuine issue of material fact as to any breach of contract of the GIA terms by defendants.
“The remaining plaintiffs-athletes argue in their conclusory affidavits that they were forced off the basketball team. Whereas, defendants argue these plaintiffs-athletes were not removed from the team, but instead chose to enter the ‘transfer portal’ to transfer to different institutions. The evidence in the record, including their own statements within their depositions, demonstrates the plaintiffs-athletes entered the transfer portal at the completion of the 2020-2021 academic year. Each cancellation of a renewal GIA stated that the student ‘indicated intent to transfer during the next academic year.’
“This evidence suggests plaintiffs-athletes’ contracts were completed for the 2020-2021 academic year and that each one chose to transfer from Lenoir-Rhyne. These decisions were made during the time frame that Lenoir-Rhyne could determine whether to renew or cancel the GIA. Further the Student-Athlete handbook provided an appeals process for student-athletes who did not receive a renewal of their GIAs. There is no indication in the record that plaintiffs appealed their GIAs. This is likely because the evidence in the record demonstrates plaintiffs entered the transfer portal to transfer to a different institution prior to any non-renewal of their GIAs. Accordingly, plaintiffs-athletes fail to demonstrate a genuine issue of material fact for the breach of contract claim against defendants.”
Similarly, the claim of Sall, the former team manager of the women’s basketball team, that she had “a contract with defendants and that they breached the contract” failed. That’s because Sall admitted “texting Coach Smith that she would ‘not be working with [the team] this semester.’” Accordingly, there is no genuine issue of material fact of a breach of contract claim against defendants because Sall admittedly quit working as the team manager. “Because plaintiff Sall fails to demonstrate defendants breached any alleged contract, we do not consider the validity of the alleged oral contract,” the panel wrote.
Fox v. Lenoir-Rhyne Univ.; Ct. App. N. C.; No. COA24-16; 12/3/24
