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Insights

February 2020

Board of Trustees of the University of Arkansas v. John Scott, Jr.: Drafting Buyout Clauses Reflecting the Economic Realities of Today’s College Football Game

By Daniel A. Cohen, Jeffrey R. Daniel

Legal Issues in Collegiate Athletics

 This article first appeared in Sports Litigation Alert Vol. 17, Iss. 2, and is printed with permission of Hackney Publications.

“Over recent years, buyout clauses have become increasingly commonplace in the college football coaching carousel, essentially providing for liquidated damages in the event of the early termination of an employment contract,” write attorneys Dan Cohen and Jeff Daniel, who co-authored an article about a contract dispute at the University of Arkansas for Legal Issues in Collegiate Athletics.

 The two provided context and perspective of the larger issues of buyout clauses, while discussing the university’s decision to file a lawsuit against a former coach.

 “When negotiating and structuring a buyout clause, a school should take these considerations into account. The buyout amount should be reasonably sufficient to cover not only future salary escalation, but also any pain the school might have to absorb in paying a replacement coach’s buy-out from a previous employment contract.”