Contracts Headline Sports Law

Kent State’s Buyout Clause And Tortious Interference Claims

A common clause in a professional or college sports coach contract is a buyout clause.  This clause typically stipulates the amount of remuneration a coach will have to tender the college or professional team if he decides to change jobs prior to the expiration of the contract, and also lays out how much money the school or pro team will have to pay the coach if it wishes to terminate the coach prior to the natural end of the contract.  Either side effectively breaches the contract by not adhering to its agreed upon term, but the buyout clause basically lays out the liquidated damages for taking such action.  At times, the buyout clause, which is negotiated freely by the parties to the contract upon its execution, becomes heavily disputed based on previously unforeseen contingencies.

Case in point: Kent State is currently suing its former men’s basketball head coach Geno Ford for leaving Kent State prior to the natural end of the term of his agreement with the school.  He has moved on to become the head coach of the Bradley University men’s basketball team.

Ford had four years remaining on his contract with Kent State when he left to take the position at Bradley.  The buyout clause within his agreement with Kent State stipulated that Ford would owe Kent State $300,000 for each year left on the contract at the time of his potential breach.

As with most civil matters, these arguments over buyout clauses tend to end up settled out of court.  As of right now, Kent State seems ready to do whatever it takes to recoup the $1.2 million it believes it is owed based on Ford’s breach of the contract.

Interestingly, Bradley University is also named on the lawsuit filed by Kent State.  Kent State’s claim is that Bradley tortiously interfered with Kent State’s contractual relationship with Geno Ford.  Kent State will have to prove the that Bradley University had knowledge of the specifics of Ford’s contract with Kent State and that Bradley intentionally interfered with those rights.  Further, Kent State will have to show a lack of justification for Bradley’s act of signing Ford and damage resulting from the interference.  If Kent State is rewarded with $1.2 million from the buyout clause, the damage will be hard to prove.  Further, Bradley signed Ford because they wanted an upgrade at the coach position, which certainly sounds like proper justification for the move.  It is rather doubtful that Bradley had a full understanding of Ford’s contract with Kent State, including the buyout clause.

It appears that Kent State’s claim against Ford for breach of contract is much stronger than its claim against Bradley University for tortious interference with contractual relations.  It seems pretty clear cut that Ford has completely ignored an important buyout clause provision embedded in the contract that he signed with Kent State, and will likely settle the matter for somewhere around $1.2 million.  Since Ford is making roughly $700,000 per year under the terms of his new contract with Bradley, I assume that his attorneys will attempt to spread out the payment of the $1.2 million owed to Kent State over multiple years.

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