Contract Analysis: What Notre Dame Paid Charlie Weiss to Leave

The Chicago Tribune obtained federal tax documents that show that after Notre Dame fired Charlie Weis as the head football coach in December 2009, “Termination payment of $6,638,403 was made during the reporting period to Charles J. Weis under a separation agreement that includes much smaller annual payments through December, 2015.” Chicago Tribune, May 20, 2011.

Despite the fact that  liquidated damages clauses in most college football head coaching contracts provide the terminated coach an amount that is less than the total owed under the remainder of his contract, at the time this issue arose many speculated that Weis would receive perhaps the entire $18 million remaining on his agreement.

And what will turn out to be between $7-$9 million dollars is  a significant amount of money, but it is much less than what it could have been.  Liquidated damages clauses vary widely amongst head college football coaching contracts, with some as little as 20% of non-incentive based pay (Rick Neuheisal at UCLA) and others as great as 100%  (Les Miles at LSU).  And the payment Weis has received thus far is consistent with the liquidated damages provisions I expected Notre Dame to have in their contract given the experience Weis had as head coach when the contract was negotiated (just one year).

And because this was such a controversial topic at the time, Mel Kiper thought I should mention in this post that  I actually predicted this outcome correctly in the fall of 2009 on ESPN radio with Kiper and Freddie Coleman.  At the time what I said  went against what all of the other analysts and reports were saying.  But even the legal analysts at ESPN wouldn’t have gotten this correct as most of them have spent careers as litigators, while I was a corporate lawyer who drafted and negotiated contracts for a living.