O'Brien v. The Ohio State University

In 1997, Jim O’Brien (plaintiff) was hired as the head coach of men’s basketball for Ohio State University (OSU) (defendant), which was a member of the National Collegiate Athletic Association (NCAA). In 1998, OSU was interested in recruiting a foreign basketball player, Alex Radojevic, who visited the campus and signed a letter of intent committing himself to attend OSU. Although circumstances were not entirely clear, O’Brien apparently gave $6,000 to Radojevic’s family as a loan (the Radojevic loan) and failed to report the payment to OSU or its athletic director, Andy Geiger. Radojevic did not end up playing for OSU. In 1999, following a very successful basketball season, OSU entered a new employment contract with O’Brien that was highly favorable to him and contained a “Terminations for Cause” provision specifying very limited reasons why he could be terminated. One reason was for an unremedied “material breach” of the agreement (material-breach clause), and another was for an unreported violation of NCAA rules that resulted in severe sanctions imposed on OSU (NCAA clause). In 2004, O’Brien disclosed the Radojevic loan to Geiger for the first time while maintaining that the payment did not violate any NCAA rules. The Radojevic loan became publicly reported, and the NCAA initiated an investigation. Later in 2004, OSU terminated O’Brien under the material-breach clause. In May 2005, the NCAA alleged that the Radojevic loan violated recruiting rules against giving financial aid to a prospective recruit or the recruit’s relatives. No decision on the matter had been made when O’Brien sued OSU for breach of contract. O’Brien alleged that he should not have been terminated for cause under the material-breach clause.