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If Pitino And Jurich Leave U of L, School Likely On Hook For Payouts

If athletic director Tom Jurich and basketball coach Rick Pitino depart the University of Louisville amid the latest scandal allegations, it’s likely the public university will remain on the hook for hefty portions of their pay.

Both have earned tens of millions of dollars during their tenures at U of L. Pitino, whose salary last year was about $5 million, is reportedly one of the highest paid coaches in college hoops.

U of L Interim President Gregory Postel placed Jurich and Pitino on paid administrative leave Wednesday afternoon, pending a review by the board of trustees. How much U of L will have to pay out if Jurich and Pitino are fired now depends on the mechanism.

Contracts typically absolve universities of big payouts when top athletics officials are fired “for cause.”

Both Jurich’s and Pitino’s contract say a major NCAA violation or dishonest conduct would justify termination. But invoking those clauses are unusual even after wrongdoing, said Marty Greenberg, a Milwaukee-based sports attorney, since it drags out the timeline and public discussions of the scandal.

“It greatly depends how much the university wants to go through with as a spectacle,” Greenberg said. “Sometimes it’s worth paying some money to put the dirty laundry in the back room and let the university go on, as it’s hard to recover from these things.”

Pitino's attorney, Steve Pence, released a statement Wednesday afternoon saying Pitino had been "effectively fired" without the due process promised in his contract.

"The information disclosed thus far in the investigation is clearly insufficient to implicate Coach Pitino in any type of misconduct or other activity that would violate the terms of his contract," Pence said.

Pitino’s contract promises him a warning before he's fired. If accused of wrongdoing, he's promised at least 10 days notice to present evidence and fight any potential termination.

His contract does not, however, lay out any terms for a firing without cause. Technically, the university would owe Pitino the tens of millions in future earnings from his contract if they didn't specify the reason he's let go, said Robert Lattinville, a sports law attorney with Spencer Fane.

But realistically, Lattinville said, that means both the university and Pitino have leverage to negotiate to a middle ground deal.

"The more substantive those [termination] provisions are and the more objective they are... the more leverage exists for the university to strike a better deal when they're choosing to part ways," Lattinville said.

U of L also faces the challenge of severing two contracts for one of the highest-paid athletic directors in the country: Jurich has agreements with both the university and the University of Louisville Foundation, its nonprofit fundraising arm.

Jurich’suniversity contract prescribes that if he’s terminated without cause, he would get 90 days notice. For violating terms of his contract or NCAA violations, Jurich is supposed to be entitled to 30 days to cure the problem.

But Jurich was promised a severance package from former U of L President James Ramsey for his base salary even if he was fired for cause, according to U of L foundation documents.

While his university contract doesn't include a severance clause, Ramsey issued a separate memo in 2011 that offered Jurich a full year's salary from the foundation if he was fired, payable in a lump sum 120 days after termination.

Greenberg said it’s not unusual for contracts to be put aside in favor of negotiating an exit, especially in the midst of a major scandal.

He said there’s no doubt the four college coaches from other universities named in the criminal case announced by the FBI on Tuesday will be fired for cause and receive no payout.

Neither Pitino or any other U of L coaches were named in the criminal complaint, although U of L’s interim president confirmed the school is part of the investigation.

Greenberg said Pitino’s NCAA suspension after the team’s last major scandal involving providing sex to recruits was because of an NCAA rule on “vicarious liability,” which means Pitino is responsible for even staffers’ actions he doesn’t know about. This newest scandal is likely to be Pitino’s problem too, Greenberg added.

“You can't turn your head any more,” Greenberg said. “You’ve got to be on top of everybody that affects your system.”

Kate Howard can be reached at  khoward@kycir.org and (502) 814.6546.

This story has been updated.

Kate Howard is the managing editor of the Kentucky Center for Investigative Reporting.