No, it's not an illegal penalty; the buyout clause is fair. It's really hard to put a price tag on all the problems a university faces when a popular coach suddenly leaves. Think about losing new players, disappointing fans and donors, and hurting the team's reputation. Since Coach Ford is a pro who knew what he was signing (he even tried to change it), the deal he made is binding. The buyout amount was a reasonable way to cover the university's hard-to-calculate losses.

Yes, it is an illegal penalty. The buyout amount seems made up just to punish the coach, not to actually cover what the university lost. The formula doesn't make sense because the damage to the university is likely the same whether the coach leaves in year one or year four, but the buyout amount is hugely different. Kent State never even tried to figure out what its real damages might be. This looks more like a threat to keep him from leaving than a fair estimate of damages.

Yes, Coach Ford has to pay because the agreed money is a fair guess of Kent State's losses, not a punishment. It's hard to know exactly how much a university loses when a coach leaves early - it can hurt ticket sales, getting new players, and community support. It also costs money to find a new coach. These losses are hard to measure exactly. Coach Ford knew what he was agreeing to and chose to sign the contract. The money he has to pay is fair, as shown by how much more money Bradley University was willing to pay him. So I agree with the lower court that Coach Ford owes Kent State the $1.2 million.

Yes, Coach Ford has to pay because the agreed money is a fair guess of Kent State's losses, not a punishment. It's hard to know exactly how much a university loses when a coach leaves early—it can hurt ticket sales, recruiting new players, and community support. It also costs money to find a new coach. These losses are hard to measure exactly. Coach Ford knew what he was agreeing to and chose to sign the contract. The money he has to pay is fair, as shown by how much more money Bradley University was willing to pay him. Therefore, we agree with the lower court that Coach Ford owes Kent State the $1.2 million.

I agree with the decision to enforce the clause because the deal was made clearly and it was meant to cover hard-to-measure losses. However, I think the way the penalty is calculated might sometimes charge too much, especially early in the contract, which makes it feel more like a punishment. So while I support the outcome, I believe it should be applied more carefully.

I disagree with the decision because I think the rule makes someone pay too much money when they break the contract, even if the school didn’t really lose that much. To me, it seems more like a punishment than a fair way to cover losses, which is very different from how the majority sees it.

—holding that a liquidated damages clause which required a university's head basketball coach to pay his salary for each year remaining under his contract was enforceable and was not a penalty because the damages were difficult to determine and the contract provision was not unreasonable

A state appellate court cited to DiNardo in upholding a $1.2 million damages award to a university based on a liquidated damages provision in a head men' s basketball coach' s contract.

Therefore, any liquidated damages clause set forth in the CBA that shows a reasonable effort to fix a plausible amount of agreed-upon damages based on best estimates will likely be upheld as valid

—considered a penalty, it would likely be considered enforceable because it is factually analogous to liquidated damages provisions featured in collegiate coaching contracts

No. The liquidated damages clause is not an unenforceable penalty because it represents a reasonable attempt to compensate the university for damages that are inherently difficult to ascertain. The court applied the three-part test from *Samson Sales, Inc.* First, the damages resulting from a coach's premature departure—such as decreased ticket sales, harm to player recruitment, and loss of community support—are uncertain and difficult to prove. Second, the clause was not unconscionable or unreasonable, as Ford was a sophisticated party who knowingly negotiated and signed the contract, and the amount was reasonably related to Kent State's investment and the loss of Ford's market value. The court noted that proof of actual damages is not required to enforce a valid liquidated damages clause. Third, the contract clearly demonstrated the parties' intent that the specified damages would follow a breach, serving a compensatory purpose for the loss of stability and investment, not a punitive one.

Yes. The liquidated damages clause constitutes an unenforceable penalty because it is not a reasonable estimate of the university's actual damages. The formula used—salary multiplied by years remaining—produces a higher amount for an earlier breach, yet the actual damages sustained by the university would likely be the same regardless of when the breach occurred. This disparity suggests the clause is designed to penalize Ford rather than compensate Kent State. Furthermore, Kent State presented no evidence that it attempted to conduct a reasonable assessment of potential losses before inserting the clause into the contract. Since the evidence, when viewed in a light most favorable to Ford, creates a genuine issue of material fact as to whether the clause is a penalty, summary judgment was inappropriate.

Yes, the liquidated damages clause is enforceable because it represents a reasonable forecast of just compensation for the harm caused by the breach, and is not a penalty. The damages from the breach of a university coaching contract are uncertain and difficult to prove, making the clause a necessary and reasonable provision. Potential damages include decreased ticket sales, impact on the ability to successfully recruit players and community support, and costs associated with searching for a new coach and coaching staff. These damages cannot be easily measured or proven, especially given the nature of how such factors may change over the course of different coaches' tenures. The clause was the result of negotiations between the parties, and Ford, a sophisticated party, made an informed choice to agree to it. The amount of damages is reasonable, as evidenced by Ford's ability to more than double his salary at Bradley, showing the loss of market value in coaching experienced by Kent State. Therefore, I affirm the trial court's decision to enforce the liquidated damages provision and award Kent State $1.2 million in damages.

I concur with the majority’s conclusion to enforce the liquidated damages clause because the contract was negotiated with clear understanding and the estimated damages reasonably reflect the uncertain losses that the university could suffer. However, I differ from the majority in that I believe the method of calculating damages—multiplying the remaining salary by the duration of the contract—can, in certain circumstances, impose an excessive burden that functions more like a penalty than a true measure of compensation. This nuance, in my view, requires a more careful application of the clause to ensure that the remedy remains strictly compensatory.

I dissent from the majority’s holding because the liquidated damages clause, by requiring payment of the full remaining salary regardless of actual losses, effectively operates as a penalty rather than a fair estimation of damages. This approach is fundamentally flawed because it imposes an undue financial burden that is not directly connected to the university’s real harm, thereby exceeding what can be justified as compensatory. In contrast to the majority’s view, I argue that the agreed-upon formula is irrationally disproportionate and should not be enforced as a matter of law.

Kent State University v. Ford

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