Coach O'Brien's contract makes it tough for him to leave Penn State

Penn State coach Bill O'Brien said: "I am committed for the long term to Penn State and our student-athletes."
Penn State coach Bill O'Brien said: "I am committed for the long term to Penn State and our student-athletes." (GENE J. PUSKAR / AP)
Posted: July 25, 2012

STATE COLLEGE, Pa. - The NCAA took a sledgehammer to Penn State football on Monday, and after less than seven months on the job, head coach Bill O'Brien now faces the daunting task of keeping an iconic program together for the next four years.

The Nittany Lions face penalties brought about by the Jerry Sandusky child sexual-abuse scandal, such as a bowl ban through the 2015 season and a sharp reduction in scholarships through the 2017 signing period. Now O'Brien must, in essence, re-recruit his current players to keep them from leaving and convince high school players that they would be happy at Penn State, even with no postseason reward.

It would be understandable if O'Brien wanted to escape and return to life as an assistant coach in the NFL, where he worked for the last five years with the New England Patriots, the last as offensive coordinator.

But it's not that easy.

When O'Brien's five-year contract was being negotiated, it included a clause that said that if O'Brien resigned before the end of the contract, he had to pay the university a sum equal to his annual base salary for the remainder of the contract, plus any TV and radio money, plus the funds from his $350,000 annual contract with Nike.

O'Brien's base salary is $950,000 for the first 18 months, with a 5 percent raise starting in July 2013 and continuing each year after that. He is expected to make $1 million annually from TV and radio contracts in addition to the Nike deal.

So counting five years of money from TV, radio, and Nike and adding the 5 percent raise each year to the base salary, O'Brien would be liable for about $12 million, if he were to resign.

When representatives for O'Brien and Penn State were negotiating the contract, the start of the Sandusky trial was still five months away, and it was six months until the findings of the special committee headed by former FBI Director Louis Freeh were released.

Michael McCann, director of the Sports Law Institute at Vermont Law School, said that O'Brien probably would have been able to terminate his contract if the NCAA imposed the "death penalty," meaning no football for at least one year. But football continues, and O'Brien would have no recourse in leaving other than to pay the huge buyout.

"I don't know if his lawyer tried to get a clause in there that would have dealt with sanctions," McCann said. "Maybe Penn State said no to that or no such effort was made. But regardless, it's not in there. Legally, I don't see how he gets out of it, because Penn State football continues. There's nothing in the contract other than paying those damages."

McCann said he does see a scenario in which Penn State may not want a coach making $2.3 million and more in the coming years to coach a program rocked by scholarship reductions. The sanction is the loss of 10 scholarships per year from 2013 through 2016, but the total number of scholarships allowed will be 65 (down 20 from the maximum), and that starts in 2014 and continues through 2017.

"They're paying him a lot of money to coach a downsized program," he said. "Maybe Penn State could be amenable perhaps to some kind of buyout that isn't as punitive as what the damages indicated it would be, but that's speculation on my part."

In a statement released by Penn State after the penalties were announced, O'Brien talked of his commitment to his job.

"I knew when I accepted the position there would be tough times ahead," O'Brien said. "But I am committed for the long term to Penn State and our student-athletes."

The penalties handed down by the NCAA also effectively deprive O'Brien of an opportunity to make the incentives outlined in the contract. Those incentives include winning the Leaders Division ($47,500 this season), qualifying for the Big Ten championship game ($76,000), earning a bowl bid ($104,000), and winning the BCS championship game ($85,500).

O'Brien was not made available to the media Monday. He is not expected to comment on the NCAA penalties until Thursday's Big Ten football media day in Chicago.


Contact Joe Juliano at 215-854-4494 or jjuliano@phillynews.com. Follow on Twitter @joejulesinq. Read his blog, "Lion Eyes," at www.philly.com/sports/lioneyes

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