Beilein's Buyout

[hoya95]

Not sure if this will need to be moved to the other board, but I found this article fascinating.

sports.espn.go.com/ncb/columns/story?columnist=katz_andy&id=2833203&lpos=spotlight&lid=tab4pos1

Beilein owes West Virginia $2.5 million for leaving early. Michigan is not going to pay it, and WVU isn't budging off that number. This could well be headed for court. If a court were to rule in Beilein's favor and say those type of buyout clauses are unenforceable (or if it were to dramatically reduce what he would have to pay), then there really would be nothing to hold any coach at any school no matter what their contract says. However, if Beilein has to pay up the whole amount (and I suspect he would), then coaches from now on might have to think twice before they leave for another job long before their contracts are up. Or schools might start to work more of these large buyouts into contracts to finally get some leverage back.
This could be a huge test case, though I really don't think something like this would ever happen with JT III. But it could be a big deal for college basketball.

[Filo]

I can't see how a court would rule these types of buyout clauses unenforceable, in general. And, the facts (at least as reported so far), indicate that this particular clause was a negotiated item, so Belein sure looks like he has an uphill battle here.

[AustinHoya03]

hoya95 said:

If a court were to rule in Beilein's favor and say those type of buyout clauses are unenforceable (or if it were to dramatically reduce what he would have to pay), then there really would be nothing to hold any coach at any school no matter what their contract says.

I don't think that's the case. If this ends up in a courtroom (and I seriously doubt it will), a ruling by a West Virginia court would have virtually no bearing on how other jurisdictions treat contract disputes.

[chep3]

They might. Court's don't usually like liquidated damages clauses even if they're freely contracted for. Not saying that they won't enforce it in this case, but court's tend not to look very highly on those that they think are way overcompensatory.

[RBHoya]

Was a really smart move by the WVU AD/administration to include such a clause. I hope we can get something similar in JTIII's next contract (though hopefully he'll stay here on his own volition).

[757hoyafan]

it was Beilein's idea, RB.

[RBHoya]

757hoyafan said:

it was Beilein's idea, RB.

Upon reading the article it looks like it was, or at least his agent's idea.

Which, it would seem, was pretty dumb.

If you're confident in your ability as a head coach, yet not entirely happy with your location or the terms of your deal--which it would appear was the cae with Beilein--why would you sign on to a deal with such a huge buyout clause, even suggesting its inclusion? I realize everybody wants safety from premature termination, but at this kind of a price? and after a successful season? Seems like Beilein had this coming.

[StPetersburgHoya (Inactive)]

I don't know about that Michigan might want to not pay the buyout and create a test case on the issue because they could potentially benefit from a court striking down these clauses because of their tremendous athletic resources.

I have no idea what the law is on this, but the policy implications are really interesting. If the court struck down a provision like this or ruled it was exorbitant, would they also rule the same way on the poison pill clauses that are in some athlete's contracts?

[SoCalHoya]

I had heard that an alumnus had paid the buyout. Guess not?

[HoyaSinceBirth]

I was surprised when I read this article a couple days ago on ESPN. I was always on the assumption that the coaches new team paid this kind of thing. I thought that was why it was called a buy out because the new team has to buy out the other coach to get him away from the old school. Am i mistaken?

[chep3]

It's just a clause that mandates the party breaking the contract must compensate the other party. It would go either way. I like you would assume that Mich would pay it, but I guess their $65 mill a year athletics budget, or whatever it is, can't fit that in.

[bmartin]

Chris Webber knows a guy who will pay it.