Ohio State Appeals $2 million Award to Former Coach in Breach of Contract Suit

Sep 29, 2006

Disappointed this summer with a state court’s ruling that it was contractually obligated to pay former Ohio State University basketball coach Jim O’Brien more than $2 million in a breach of contract suit, OSU filed an appeal this month with the 10th District Court of Appeals.
One of the school’s chief arguments will undoubtedly be that O’Brien violated NCAA rules when he gave money to the mother of a recruit, thus voiding the kind of financial award that O’Brien has sought and successfully secured, perhaps temporarily, at the trial court level.
That court, the Ohio Court of Claims, held that “The parties in this case negotiated a contract virtually guaranteeing plaintiff that he could not be terminated for an NCAA infraction, without compensation, unless the NCAA had made a finding that plaintiff had committed a major infraction that resulted in either a finding of lack of institutional control or the imposition of serious sanctions.”
O’Brien was hired by OSU in April of 1997. A little over two years later, his contract was renegotiated and his duties were set forth as follows:
“4.0 Coach’s Specific Duties and Responsibilities
”4.1 In consideration of the compensation specified in this agreement, Coach shall:
”(d) Know, recognize and comply with all applicable laws, policies, rules and regulations of Ohio State, the Big 10 Conference and the NCAA; supervise and take appropriate steps to ensure that Coach’s assistant coaches, any other employees for whom Coach is administratively responsible and the members of the Team know, recognize and comply with all such laws, policies, rules and regulations; and immediately report to the Director and to the Department of Athletics Compliance Office if Coach has reasonable cause to believe that any person or entity, including without limitation, representatives of Ohio State’s athletic interests, has violated or is likely to violate any such laws, policies, rules or regulations. Coach shall cooperate fully with the Department’s Compliance Office at all times.”
O’Brien was terminated as men’s basketball coach on June 8, 2004. At the heart of the university’s decision to fire O’Brien was the fact that he had loaned money to the mother of one of his basketball players, Alex Radojevic.
While conceding that he may have breached his employment agreement by violating NCAA rules, O’Brien claimed in a lawsuit against the university that “his relatively minor failure of performance did not give defendant sufficient cause to immediately terminate his employment without pay.”
The argument around the timing of the termination seemed to resonate with the state court, which noted that the NCAA findings were “clearly sufficient,” to fire O’Brien, but that the university’s stated reason for firing him, a material breach of contract, was insufficient.
While there was no statement with the appeal, Ohio State vice president and general counsel Christopher M. Culley issued the following after the state court’s ruling:. “We continue to believe that the university acted appropriately in dismissing Coach O’Brien. The NCAA sanctions that followed the court’s initial decision in February 2006 validated the serious nature of the violations.”
The case is being watched by colleges throughout the country.
Matt Mitten, the Director of the National Sports Law Institute at Marquette University in Milwaukee, told Legal Issues in Collegiate Athletics that the ruling sends a “lesson” that “you have to be very, very careful in drafting the language in these contracts. Schools will want as much flexibility as possible to terminate a coach.”
O’Brien is being represented by attorney Joseph Murray.


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