Good news, bad news for Michigan in NCAA findings

The good news for Michigan is that according to a report from ESPN’s Joe Schad, the NCAA is expected to find that Rich Rodriguez did not fail to promote an atmosphere of compliance as previously alleged by the NCAA.

The bad news for Michigan:  The NCAA is expected to find  that Rich Rodriguez did not fail to promote an atmosphere of compliance.

And that is the difficulty being faced by the school.   There has been growing discontent with the lack of production on the field and with Rodriguez’s performance in many facets of running a program.  An NCAA finding that Rodriguez failed to promote an atmosphere of compliance could have been used by the school to terminate his contract for cause, a provision which would save the university millions of dollars in the transition. 

Now, the school will be faced with the ultimate dilemma:  Has Rodriguez shown enough progress to warrant retention as head coach.

Interestingly, Rodriguez’ contract provides for a $4 million buyout if he is terminated for cause through December 31, 2010, but that buyout amounts drops to $2.5 million if he is terminated on or after January 1, 2011.  So in a crazy way, Rodriguez may make more money by having a major collapse and not making a bowl, then he will by reaching a bowl game and being terminated after new years.

In another drafting quirk, Rodriguez’s contract is not clear as to whether the termination date is the date of the notice provided to him or the date on which the 30 day notice period expires.   If you take the more likely construction (that the termination is effective at the end of the 30 days period), then you see a scenario in which Rodriguez could be given notice as early as December 2, 2010.

The NCAA has found 4 other major violations, so accordingly, Michigan may have no liability to Rodriguez.   Michigan only challenged the issue relating to his failure to promote an atmosphere of compliance.

His contract provides that if he is terminated for cause, the school will have no liability to him. 

Two of the “for cause” provisions are potentially applicable to this situation:

Section 4.02

(e):  Rodriguez is determined by the NCAA, the Big Ten Conference, or the University to have committed a major violation of the NCAA Rules, or to have intentionally committed any other type of violation of the NCAA Rules, pursuant to Section 2.05 of this Agreement;

(f)   If Rodriguez has personal knowledge of a violation of the NCAA Rules by an assistant football coach, football staff member, student athlete who is a member of the Team, or other representative of the University’s athletic interests and fails to promptly report it to the Athletic Director pursuant to Section 2.04.

The provisions would give the University position to argue that its termination is “for cause” thus voiding any required buyout.  In most cases, a “for cause” termination will result in litigation which the University tends to want to avoid (more than the coach wants to avoid).   This essentially results is some negotiation of a reduced buyout depending on the relative strengths or weaknesses of each side’s case as it relates to the termination issues.

It should be a very interesting 60 day window coming up for the Michigan football program.