Tuesday, 15 January 2013

Calculating a University's Damages from the Loss of a Successful Coach

In my 2009 article on the Coaching Carousel, I discussed how universities are harmed when a successful coach breaches his contract and another institution commits tortious interference.  Due to the fact that coaches (like professional athletes) are not easily replaceable and the difficulty of ascertaining damages, I explained how the university is entitled to equitable relief in the form of a negative injunction to prevent the coach from working for the competitor institution. 

Unlike the professional sports leagues, for some reason the NCAA has failed to adopt a “no tampering” policy that would prohibit a coach under contract from seeking or accepting other employment unless and until he has either been terminated or granted permission to explore other employment opportunities.  The unanswered question from my prior work, and the narrow issue presented in my latest paper to be published in South Carolina Law Review, is:  In the absence of a buyout payment (either agreed to pre-breach in the contract or agreed to post-breach), how does the university prove its financial loss if it elects to sue the coach and interfering institution for damages instead of equitable relief?  Here is the paper abstract:

This essay addresses the difficulty of proving the financial harm that results when a head coach departs a college or university during the contract term and the institution thereby abruptly loses a valuable asset — a successful and stable athletic program. Due to the unique and specialized nature of head coaches’ services and the industry in which they work, ordinary measures for assessing damages based on substitute performance and transaction costs are insufficient. This essay offers a theory of measuring a university’s damages within the construct of a lost-income-producing-asset valuation, using a methodology based on liquidated damages amounts in comparable coaches’ contracts.

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