Toronto Raptors head coach Nick Nurse has enough ties to California to face his former agent’s lawsuit, a federal judge ruled on Monday.

Agent Warren LeGarie contends he is owed a commission on a reworked contract Nurse signed with the Raptors in 2020, along with other damages. LeGarie filed his complaint, which contains breach of contract and related claims, in June.

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Nurse and LeGarie began to work together in 2013, when the Raptors hired Nurse as an assistant coach. Nurse, 54, had 24 years of coaching experience by that point—including stints in college, Europe, the U.S. Basketball League and the G League—and yet he did not have an agent. In a meeting with Raptors officials, the team suggested Nurse retain LeGarie, who has represented Rick Carlisle, George Karl, Terry Stotts and other NBA coaches and executives.

From Toronto, Nurse called LeGarie, who was in San Francisco where his agency, WGL Management, is headquartered. In this case, location matters. LeGarie claims that Nurse asked him to be his agent. Nurse, meanwhile, asserts that LeGarie agreed to review the Raptors contract in Toronto.

LeGarie and Nurse never signed a written contract. They instead used what LeGarie terms “an open-ended agreement that resulted in ongoing negotiations between [LeGarie], on behalf of Mr. Nurse, and the Toronto Raptors.”

The use of an oral agreement, in lieu of a written contract, proved problematic. In sworn testimony, the two men offered diverging narratives of their so-called understanding.

LeGarie says he was owed a 4% commission on assistant coach contracts and a 3% commission on head coach contracts. But Nurse insists that LeGarie “told me he would not charge any commission until he secured a head coaching job for me.”

LeGarie claims he invoiced Nurse at least seven times, charging commissions on employment contracts Nurse had signed with the Raptors. LeGarie also says that Nurse paid invoices by check or wire transfer, and both methods were directed to California. Nurse says he “disagreed” with the first invoice “based on LeGarie’s prior promise.” However, he acknowledges that he “paid the bill in full.” Nurse was promoted to head coach in 2018. The Raptors won the NBA title the following year. In 2020, Nurse was named NBA Coach of the Year.

The conflict between Nurse and LeGarie arose in April 2020, when the Raptors informed Nurse—who had been asking for a contract extension—they’d like to redesign and extend his contract. Nurse then hired the agency Klutch Sports Group. According to court records, Nurse called LeGarie from Toronto to say he was letting him go, a move that LeGarie describes as a breach.

Nurse sees it differently, namely that his interpretation of the representation arrangement contemplated a right to “terminate the relationship with LeGarie at any time.” According to LeGarie, Nurse’s salary for 2020-21 was bumped up from $2.9 million to between $6 million and $8 million, and three additional years, at $8 million per year, were added.

LeGarie insists his work played a crucial role in Nurse landing a new deal, including “multiple meetings” with Raptors president Masai Ujiri and general manager Bobby Webster. Nurse, meanwhile, says that agent Andy Miller from Klutch represented him and negotiated the deal.

Nurse denies he broke any laws and contends a California federal court lacks personal jurisdiction over Nurse. Personal jurisdiction hinges on whether, as expressed by law, Nurse “purposely availed himself” of the “privilege of doing business” in California.

Nurse maintains he “never traveled to California to meet with LeGarie” and only went there as a Raptors coach for games against the Lakers, Clippers, Kings and Warriors and for other limited activities (player training sessions and a pro-am golf tournament). LeGarie, on the other hand, insists he met with Nurse in California and that they discussed his employment with the Raptors and his future as an NBA coach. LeGarie also estimates that 90% of his Nurse-related work was done in San Francisco.

Judges use a multifactor test to assess if personal jurisdiction exists. Judge Joseph Spero explained that while there are factors that cut both ways, Nurse came up short in proving a lack of personal jurisdiction.

Working in Nurse’s favor, the judge explained, was that Nurse did not travel to California to conduct negotiations. Nurse calling LeGarie while the agent was in California also did not show he intended to solicit business in California. Nurse neither wanted a continuous presence in California nor was he seeking to market his services there.

On the other hand, Nurse specifically contacted LeGarie in California for a business purpose—to develop an agency relationship. Their agreement was also open in duration and lasted seven years, during which LeGarie worked on Nurse’s behalf. Nurse also met with LeGarie in California (even if Nurse was there for games) and paid commissions to LeGarie in California. The judge also opined that Nurse is not “greatly inconvenienced” by having to litigate in California since he travels there for coaching and since courts are more willing to use video conferencing given the COVID-19 pandemic.

Judge Spero was also unpersuaded by Nurse’s argument that because the case centers on conduct that occurred in Canada—the signing of contracts and negotiations with Raptors officials—jurisdiction in California is improper. “Nurse,” the judge stressed, “entered into an ongoing contract with an agent who resides in California and did most of his work in California. But for that conduct, Plaintiffs’ contract claims against Nurse would not have arisen.”

Nurse could still prevail in the litigation, which is in an early stage. He and LeGarie could also reach a settlement at some point. The case serves as a reminder that oral contracts, while enforceable in certain scenarios, can spark unintended problems when parties have different recollections about their agreement and the consequences of ending that agreement.

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