College Coaching Buyout Bonanza Survives Pandemic, Reform Era

·8 min read

Never mind the fanfare over what college athletes can now earn on the side, Ed Orgeron serves to remind that the best-paying gig in college sports is not just head football coach, but fired head football coach.

Orgeron, who was terminated by LSU earlier this month, is slated to receive a $16.9 million golden parachute, becoming the latest example of the contractual one-sidedness that defines this most peculiar labor market.

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Without tenure or unionization, college football coaches—and, to a slightly lesser extent, men’s basketball coaches—have come to enjoy the industry norm of five-to-seven-year employment deals that are mostly guaranteed. This, despite the constant churn of coaching terminations, many of which lead to multi-million-dollar payoffs.

For 2019, public FBS schools cumulatively spent more than $85 million in severance packages, according to school financial documents obtained by Sportico, with at least 21 of those institutions coughing up in excess of $1 million.

Some contend this is the necessary cost of doing business, especially for an SEC superpower like LSU, whose football program reported earning $91.9 million in revenue last year.

Then again, in almost any other circumstance, the idea of a nonprofit employee—let alone one retained by a public, land-grant university—being dismissed so lavishly would represent its own kind of scandal. But in college sports, it’s become so normalized that, at a press conference last week, Orgeron felt inclined to make light about his nine-figure sendoff, joking that it gave him sufficient funds to “buy me a hamburger.”

“When you live in capitalist society, if you want to get the best, there has to be some assurance of stability and long-term commitment,” said Donna Lopiano, a former top athletics administrator at Texas who now serves as president of The Drake Group, a college sports reform organization. “But where we have fallen down is conditioning it on educationally sound measures.”

Experts and close observers foresee the buyout bonanza continuing apace, despite growing public scrutiny over the economics of intercollegiate athletics, particularly against the backdrop of the pandemic and NIL reform.

“I don’t see any change on the horizon,” said Martin Greenberg, a lawyer and adjunct law professor who has both represented and served as an expert witness for a number of college coaches involved in contract disputes. “I thought 10 years ago that this was something that would get either regulated or altered, but it has only increased.”

As such, it should be of little surprise if Orgeron’s replacement at LSU receives an even more generous contract, especially considering he will be sitting opposite the negotiating table from LSU athletic director Scott Woodward. In 2017, Woodward, then the AD at Texas A&M, signed Jimbo Fisher to a benchmark-setting, 10-year, $75 million agreement.

After inking a four-year extension last month, Fischer is currently safeguarded by a buyout clause that would exceed $95 million were the Aggies to fire him, without cause, before Dec 1.

In announcing Fischer’s extension, current Texas A&M AD Ross Bjork modestly characterized the commitment as “providing the appropriate amount of stability and continuity.” Bjork made this public assessment as someone who is no stranger to the precariousness of football coaching hires.

While AD at Mississippi, Bjork was entangled in a lawsuit filed by former football coach Houston Nutt, which accused his successor Hugh Freeze, Bjork and other Ole Miss administrators of defaming him while defending the school in an NCAA recruiting probe. Nutt said the school’s comments about him to investigators amounted to a breach of the non-disparagement terms in the separation agreement they had reached, upon his firing, in 2011.

Nutt retained prominent trial lawyer Tom Mars, who has since been hired by several other high-priced college coaches to handle their contested divorces from schools.

Mars’ current clients include former Cincinnati men’s basketball coach John Brannen, who filed a federal lawsuit against that school in May over the $5 million buyout he says he’s still owed. Before that, Mars represented Illinois football coach Bret Bielema in a wrongful termination lawsuit against Arkansas, which ultimately reached a settlement that paid Bielema $3.53 million of the $7.4 million he initially sought.

Despite his professional interests, Mars decries the fact that the system encourages public universities to be party to outlandish deals.

“I think it is utter madness that these contracts even exist in the first place,” Mars said.

Recruiting is often identified as a prime culprit: A high school prospect, the logic goes, won’t want to play for a program without the guarantee that the coach who recruited him will be there for his entire four- or five-year playing career.

It’s easy to do since the replacement cost is never directly borne by those making the hiring decisions.

“If you are an AD, you don’t get any penalty points because you blew a bunch of money,” said Mars.

Greenberg notes that the very university administrators who sign off on coaching contracts have themselves come to enjoy the executive comforts of multi-year deals with buyout clauses.

“Whether you lay it at the doorstep of the NCAA or conferences or institutions, what you describe is a lack of leadership driven by people who are largely successful in this system,” said Fred Glass, who served as Indiana’s athletic director from 2008 to 2020.

During his tenure with the Hoosiers, Glass held the distinction of being one of the few—if only—Power Five ADs to serve as an at-will employee. And yet, he still followed the traditional path when it came to his new hires.

“I gave everyone long-term contracts,” Glass said. “In fact, a lot of our Olympic coaches didn’t have long-term contracts, and I thought that was bulls—, and I ended up giving almost all those guys multiyear contracts.”

Glass, who has authored a soon-to-be-released book, Making Your Own Luck, about his experience holding the IU tiller, says that there is nothing inherently problematic about committing to a coach over an extended period of time. That said, he believes that coaching contracts have gotten so out-of-whack that only an authoritative mandate to cap compensation will stem the tide of pay redundancies.

For some time, certain college reform advocates have lobbied for Congress to provide a “limited antitrust exemption” to the NCAA, so it could set limits on coaching and athletic administrative compensation. However, the proposal has never gained serious political support.

In 1998, a federal grand jury awarded $66 million in a class action lawsuit brought against the NCAA by 1,900 college assistant coaches, who claimed that the association had illegally restricted their earnings through rule changes passed six years earlier. Given the fallout since the Supreme Court’s unanimous ruling in NCAA v. Alston, which has brought college sports’ governing body to its knees, it seems even less plausible that it would be positioned in the future to clamp college sports salaries.

Mars principally blames the role of athletic department boosters in the hiring and firing processes of college coaches. “There is no analogy to the influence that boosters have,” Mars said. “If you applied that concept to corporate America, our economy would collapse.”

If there is any inkling of a market correction, it might be found in schools fighting more aggressively on the back end of deals, not automatically paying the full freight of their buyouts.

“The general rule is you don’t hang your dirty laundry in public,” said Greenberg, who was a plaintiff’s expert in the Bielema matter. “Prolonged litigation with coaches hurts the image [of the] school, and it hurts alumni donations…. That has all changed in the last five years…. Schools are becoming more litigious.”

And yet, despite Orgeron being accused of lying to Title IX investigators and failing to report rape allegations made against his players, LSU hasn’t even head-faked that it would contest his buyout.

Meanwhile, the prevailing power dynamic has encouraged all kinds of ex-coaches to make a play for their buyouts, or at least a share of it.

In just the past fortnight, lawyers representing recently fired Washington State football coach Nick Rolovich and ex-Tennessee boss Jeremy Pruitt have declared war against their former schools, threatening to initiate expensive and embarrassing legal action if they aren’t paid millions to go away.

Rolovich was fired last week after refusing to be vaccinated against COVID-19, despite a state-ordered requirement for higher education workers. His lawyer, Brian Fahling, responded by accusing WSU AD Pat Chun of being anti-Catholic and claiming that Chun had contracted the novel coronavirus during a “secret donor trip” last summer.

Meanwhile, Pruitt’s attorney, Michael Lyons, has threatened legal action that will “cripple UT’s athletic programs for years,” if Tennessee doesn’t pay his client’s $12.6 million buyout.

UT fired Pruitt—and nine other football staffers—for cause in January, after it claimed to have discovered the football staff transgressing major NCAA recruiting rules.

The university has suggested it will not capitulate to Pruitt’s demands, declaring it will “vigorously” defend itself in court. But Lyons has reason to remain undeterred.

In 2019, he represented former Kansas football coach David Beaty, who sued the university after he was fired for cause the previous year. Beaty had compiled a bleak 6-42 record prior to his termination. In his lawsuit, he claimed that the university had cooked up a bogus internal NCAA investigation into his program as a pretext for getting around his $3 million buyout.

“Kansas Athletics apparently wants to un-bake [sic] the proverbial cake it made,” the lawsuit stated. The university suggested it was willing to defend its actions before a jury, but after a year of contentious legal wrangling, settled with Beaty for nearly the full amount he had sought ($2.55 million).

Afterwards, Lyons declared it a win for “college coaches everywhere.”