Why Didn't Rutgers Fire Basketball Coach Mike Rice for Cause?

Late last week, Rutgers announced that it reached a $475,000 settlement with former men’s basketball coach Mike Rice and that no cause for Rice’s termination would be provided.  Recently-publicized videotapes show Rice at practices hitting, kicking and throwing basketballs at his players and taunting them with obscenities and anti-gay slurs (not to be confused with this shocking video of Middle Delaware State women’s basketball coach Sheila Kelly throwing toasters at her players).  The announcement came more than two weeks after Rutgers President Robert Barchi told reporters that Rice was fired, but not for cause.  And that announcement came several months after Rice was suspended from work for three days, following an internal investigation by outside counsel, resulting in this report. 

All of this leads us at Suits by Suits to ask:  what gives?  How is it possible that Rice’s abusive behavior towards his players was not cause for terminating his employment that would have relieved Rutgers from any obligations to make further payments to him under his contract?  After all, “cause” for termination was defined in Rice’s contract to include:

(1) “conduct tending to bring shame or disgrace to the University as determined in good faith by the Director of Intercollegiate Athletics,”

and

(2) “violation of University policies, regulations, procedures or directives not remedied after thirty (30) days written notice . . . ”

Without asking Barchi or the lawyers who advised him and the university (whose communications would be protected by the attorney-client privilege anyway), it is impossible to know how Barchi concluded that Rutgers could not fire Rice for cause.  But we have a theory.  The internal investigation, which started last November, was not focused on whether Rice could be terminated for cause.  Rather, the purpose of the investigation was to examine the allegations of an assistant basketball coach that he was wrongfully terminated for blowing the whistle on Rice’s abusive behavior towards players (see this interview of Suits by Suits blogger Jason Knott on the assistant coach’s claims).  Nevertheless, the internal investigators looked into Rice’s behavior with players and concluded that there was “sufficient evidence to find that certain actions of Coach Rice . . . constituted harassment or intimidation within” university policy, and that the athletic director “could reasonably determine that Coach Rice’s actions tended to embarrass and bring shame or disgrace to Rutgers . . . .”

The problem for Rutgers is that, apparently, the athletic director never did determine (in good faith or otherwise) that Rice engaged in conduct tending to bring shame or disgrace to the university, which means that that definition of “cause” in the contract was never satisfied.  As for the definition of cause having to do with violating University policies, if Rice remedied (or remedies) the violations within 30 days of receiving written notice from the university, then there is no cause.

Other definitions of “cause” in Rice’s contract – including “neglect of duty,” “willful misconduct” or “act(s) of moral turpitude” – may have been relevant but were not considered by the internal investigators as they examined Rice’s behavior in their report.  And, those definitions apparently were ruled out earlier this month when Barchi insisted that Rice was not fired for cause.  That’s our theory, anyway.

• Breach of Contract
• Executive Compensation
• Severance Agreements
• Termination With or Without Cause
• Whistleblowers
• Wrongful Termination